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Cincinnati Financial Corporation Just Beat Analysts’ Forecasts, and Analysts Are Updating Their Models
Cincinnati Finance Corporation (NASDAQ:CINF) has just released its latest quarterly results and things are looking rosy. Overall, it was a positive result, with revenues beating expectations by 3.9% to $2.5 billion. Cincinnati Financial also reported a statutory profit of $1.98, which was an impressive 107% above what analysts had predicted. Earnings are an important time for investors as they can track a company’s performance, see what analysts are predicting for the coming year and see if there has been a change in sentiment towards the company. Readers will be happy to know that we have aggregated the latest statutory forecasts to see if analysts have changed their minds about Cincinnati Financial following the latest results.
See our latest analysis for Cincinnati Financial
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Taking into account the latest results, Cincinnati Financial’s eight analysts currently expect revenues in 2024 to be $10.6 billion, roughly in line with the last 12 months. Statutory earnings per share are expected to fall 28% to $9.88 in the same period. Prior to this earnings report, analysts were forecasting revenues of $10.5 billion and earnings per share (EPS) of $9.34 in 2024. Therefore, the consensus appears to have become a bit more optimistic about Cincinnati Financial’s earnings potential following these results.
The consensus price target remained unchanged at $134, implying that the improved earnings outlook is unlikely to have a long-term impact on shareholder value creation. That’s not the only conclusion we can draw from this data, however, as some investors also like to consider the spread in estimates when evaluating analysts’ price targets. There are some varying perceptions about Cincinnati Financial, with the most bullish analyst valuing it at $151 and the most bearish at $116 per share. Still, with such a narrow range of estimates, it suggests that analysts have a good idea of what they think the company is worth.
Another way to view these estimates is in the context of the bigger picture, such as how forecasts compare to past performance and whether forecasts are more or less optimistic relative to other companies in the industry. industry. We’d like to highlight that revenue is expected to reverse, with an annualized decline forecast at 1.2% through the end of 2024. This is a notable change from the historical growth of 7.9% over the past five years. In contrast, our data suggests that other companies (with analyst coverage) in the same industry are expected to see their revenue grow at 5.1% per year for the foreseeable future. It’s quite clear that Cincinnati Financial’s revenue is expected to perform substantially worse than the broader industry.
The story continues
The bottom line
Most importantly, analysts have upgraded their EPS estimates, suggesting that there has been a clear increase in optimism for Cincinnati Financial following these results. Fortunately, analysts have also reconfirmed their revenue estimates, suggesting that it is tracking in line with expectations. Although our data suggests that Cincinnati Financial’s revenue is expected to underperform the broader industry, the consensus price target has held steady at $134, with the latest estimates not being enough to have an impact on their price targets.
With that in mind, we wouldn’t be too quick to jump to conclusions about Cincinnati Financial. Long-term earnings power is far more important than next year’s profits. We have estimates—from multiple Cincinnati Financial analysts—going all the way to 2025, and you can see them for free on our platform here.
Even so, be aware that Cincinnati Financial is showing 1 warning sign in our investment analysis you should know about…
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take into account your objectives or financial situation. Our aim is to bring you long-term focused analysis, driven by fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, send an email editorial-team@simplywallst.com