CNA Financial Corp (CNA) stock analysis

P/E above its 5-year median

CNA Financial's P/E of 12.7 is above its own 5-year median of 10.9.

P/E above the industry

CNA Financial's P/E of 12.7 is above the Fire, Marine, and Casualty Insurance median of 10.4.

P/S below the industry

CNA Financial's price-to-sales of 0.86 is below the Fire, Marine, and Casualty Insurance median of 1.28.

P/B below the industry

CNA Financial's price-to-book of 1.28 is below the Fire, Marine, and Casualty Insurance median of 1.62.

Trading above fair value

The share price of $48.25 is above our fair value estimate of $47.02.

Margin of safety under 20%

The price is 2.6% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 8.1% a year over the last three fiscal years, short of the 10% we look for.

EPS growing 10%+ a year

Diluted EPS grew 23.2% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew 3.3% over the last twelve months, against a 5-year average of 13.1% a year.

Growing slower than the industry

Revenue grew 2.1% 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 9.6% over the last twelve months and averaged 10.2% over five years; we look for 15% on both.

Return on assets over 1%

Return on assets was 1.5%; for a bank or insurer, 1% or more is considered good.

Return on equity below the industry

CNA Financial's return on equity of 9.6% is below the Fire, Marine, and Casualty Insurance median of 15.9%.

Earnings grew over 5 years

Net income grew 13.1% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 6.8% over the last twelve months, against a 5-year average of 8.0%.

Net margin below the industry

CNA Financial's net margin of 6.8% is below the Fire, Marine, and Casualty Insurance median of 12.0%.

Low debt

Debt is 29.1% of shareholders' equity, under the 40% we consider low.

Debt rising against equity

Debt to equity rose from 21.8% five years ago to 29.1%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 76.2% 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

CNA Financial paid dividends worth 8.1% of the share price over the last twelve months.

Yield above Treasuries

The 8.1% yield is above the 4.4% on a 1-year Treasury.

Yield in the top quarter

The top quarter of US dividend payers yield 3.8% or more; CNA Financial yields 8.1%.

Dividend was cut

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

Not covered by earnings

Dividends take 104% of net income, leaving little room.

Covered by free cash flow

Dividends take 48.9% of free cash flow.