Cincinnati Financial Corp (CINF) stock analysis

P/E above its 5-year median

Cincinnati Financial's P/E of 11.1 is above its own 5-year median of 10.0.

P/E above the industry

Cincinnati Financial's P/E of 11.1 is above the Fire, Marine, and Casualty Insurance median of 10.4.

P/S above the industry

Cincinnati Financial's price-to-sales of 2.19 is above the Fire, Marine, and Casualty Insurance median of 1.28.

P/B above the industry

Cincinnati Financial's price-to-book of 1.80 is above the Fire, Marine, and Casualty Insurance median of 1.62.

Trading above fair value

The share price of $189.78 is above our fair value estimate of $172.30.

Margin of safety under 20%

The price is 10.1% above fair value, so there is no margin of safety.

Revenue growing 10%+ a year

Revenue grew 24.4% a year over the last three fiscal years.

EPS growth over 3 years

Needs positive EPS three years ago and today.

Earnings growth accelerating

Net income grew 25.5% over the last twelve months, against a 5-year average of 14.5% a year.

Growing faster than the industry

Revenue grew 9.9% over the last twelve months; the Fire, Marine, and Casualty Insurance median is 5.0%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin trend

Banks and insurers do not report gross profit.

Return on equity under 15%

Return on equity was 16.9% over the last twelve months and averaged 14.2% over five years; we look for 15% on both.

Return on assets over 1%

Return on assets was 6.4%; for a bank or insurer, 1% or more is considered good.

Return on equity above the industry

Cincinnati Financial's return on equity of 16.9% is above the Fire, Marine, and Casualty Insurance median of 15.9%.

Earnings grew over 5 years

Net income grew 14.5% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 20.1% over the last twelve months, against a 5-year average of 16.2%.

Net margin above the industry

Cincinnati Financial's net margin of 20.1% is above the Fire, Marine, and Casualty Insurance median of 12.0%.

Low debt

Debt is 5.3% of shareholders' equity, under the 40% we consider low.

Debt falling against equity

Debt to equity fell from 7.8% five years ago to 5.3%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 361% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term liquidity

Insurers do not split assets into current and non-current.

Bankruptcy risk (Altman Z)

The Altman model does not apply to insurers.

Pays a dividend

Cincinnati Financial paid dividends worth 1.9% of the share price over the last twelve months.

Yield below Treasuries

The 1.9% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Cincinnati Financial yields 1.9%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 10 fiscal years.

Covered by earnings

Dividends take 20.7% of net income.

Covered by free cash flow

Dividends take 17.9% of free cash flow.