American Financial (AFG)
NYSE:AFG
Want to see AFG full AI Analyst Report?
Top Page
American Financial Group
(NYSE:AFG)
Select Model
Select Model
Rating:76Outperform
Price Target:
$148.00
â–²(12.58% Upside)
Action:Reiterated
Date:05/10/26
AFG scores well primarily on strong underlying financial performance (profitability, ROE, moderate leverage, solid cash conversion) and a constructive earnings update showing improved underwriting and strong capital returns. Valuation is supportive due to a moderate P/E and high dividend yield. The main constraint is a neutral technical setup and some cyclical/volatility risks highlighted around cash-flow variability and investment/alternatives mark-to-market swings.
Positive Factors
Underwriting Improvement
A materially improved combined ratio and a large jump in specialty P&C underwriting profit indicate durable underwriting discipline and better risk selection. Sustained lower loss costs and reserve tail benefits reduce earnings volatility and support recurring underwriting profitability over quarters.
Negative Factors
Alternative Investment Volatility
Exposure to CLOs and other alternatives introduces mark-to-market swings that can materially affect quarterly earnings and regulatory capital. Even modest allocations can produce persistent earnings volatility and complicate forecasting of investment returns and surplus over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Underwriting Improvement
A materially improved combined ratio and a large jump in specialty P&C underwriting profit indicate durable underwriting discipline and better risk selection. Sustained lower loss costs and reserve tail benefits reduce earnings volatility and support recurring underwriting profitability over quarters.
Read all positive factors
American Financial Group (AFG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.40B
Dividend Yield6.71%
Average Volume (3M)471.46K
Price to Earnings (P/E)13.9
Beta (1Y)0.52
Revenue Growth-1.65%
EPS Growth10.67%
CountryUS
Employees8,700
SectorFinancial
Sector Strength70
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)10.51
Shares Outstanding83,086,080
10 Day Avg. Volume396,546
30 Day Avg. Volume471,459
Financial Highlights & Ratios
PEG Ratio-2.77
Price to Book (P/B)2.38
Price to Sales (P/S)1.40
P/FCF Ratio8.19
Enterprise Value/Market Cap1.04
Enterprise Value/Revenue1.45
Enterprise Value/Gross Profit4.48
Enterprise Value/Ebitda9.36
Forecast
1Y Price Target
$142.33Price Target Upside8.27% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)11.57
Revenue Forecast (FY)$7.57B
American Financial Group Business Overview & Revenue Model
Company Description
American Financial Group, Inc., an insurance holding company, provides specialty property and casualty insurance products in the United States. It offers property and transportation insurance products, such as physical damage and liability coverag...
How the Company Makes Money
AFG makes money primarily through (1) underwriting income and (2) investment income generated from insurance float, supplemented by fees and spread-based earnings in its annuity-related operations. In its specialty P&C insurance business, AFG earn...
American Financial Group Earnings Call Summary
Earnings Call Date:Apr 29, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 05, 2026
Earnings Call Sentiment Positive
The call was broadly positive: AFG reported strong underwriting performance across its specialty insurance businesses, a 36% YoY increase in core net operating earnings per share, a 17% annualized ROE for the quarter, premium growth and sustained renewal-rate momentum, substantial shareholder returns, and a forthcoming ~$125 million pretax gain from the planned asset sale. Key risks discussed included short-term mark-to-market losses in CLOs/alternatives, modest expense-ratio pressure from strategic investments and contingent commissions, some competitive pressure in excess & surplus lines, and modest private-credit exposure; management characterizes these risks as manageable given portfolio structure and capital generation. On balance, the positive underwriting and capital-management developments materially outweigh the quarter-specific investment volatility and other headwinds.Positive Updates
Strong Core Earnings and ROE
Core net operating earnings of $2.47 per share for Q1 2026, a 36% increase year-over-year; annualized core operating return on equity of 17% for the quarter.
Negative Updates
Alternative Investment Shortfall in Quarter
Annualized return on alternative investments at the P&C portfolio was slightly negative in Q1 2026 versus 1.8% in Q1 2025. A $13 million mark-to-market loss on a $133 million investment in CLOs (which AFG manages) was the most significant contributor, reflecting deterioration in the broadly syndicated loan market in Q1 2026.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Core Earnings and ROE
Core net operating earnings of $2.47 per share for Q1 2026, a 36% increase year-over-year; annualized core operating return on equity of 17% for the quarter.
Read all positive updates
Company Guidance
The company’s forward-looking guidance emphasized continued capital generation and strong operating momentum: Q1 annualized core operating ROE was 17% with core net operating earnings of $2.47 per share (up 36% YoY) and Specialty P&C underwriting profit up 66% as that group’s combined ratio improved to 90.3% (from 94.0%), aided by 2.2 points of cat losses and 4.4 points of favorable prior-year reserve development; P&C gross/net written premiums rose 6%/3%, with average renewal rates ex‑workers’ comp ~5% (3% including comp) and commercial auto rates up ~14%. By segment, Property & Transportation combined ratio was 87.6% (premiums +11%/+6% gross/net), Specialty Casualty combined ratio 95.8% (premiums +2%/+2%, renewals ex‑comp ~6%), and Specialty Financial improved ~7 points (premiums +6%/+1%, renewal pricing ~1%). Investment guidance: a $17.1B portfolio (~2/3 fixed maturities) with P&C fixed‑maturity yields ~5.25% and duration 3.1 years, Q1 net investment income ex‑alternatives +8% YoY, alternatives were slightly negative in Q1 (vs 1.8% LY) including a $13M mark‑to‑market on $133M of CLOs but management expects alternatives to average ~10%+ annually long‑term; direct private credit ~$250M (1.5% of investments) and indirect private credit ~$800M (<5%), with market value ~cost at 3/31/26. They expect to close the Charleston Harbor sale in Q2/Q3 and recognize a pretax core operating gain of ~ $125M, returned nearly $260M to shareholders in Q1 (including $60M buybacks, $1.50 special dividend and $0.88 regular dividend), delivered book‑value growth plus dividends of 3.1% for the quarter, and said operations should generate significant excess capital through 2026 to fund acquisitions, special dividends or further repurchases (noting their prior 8% business‑plan assumption may be conservative given the year‑to‑date start).American Financial Group Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
74
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 8.15B | 8.17B | 8.28B | 7.73B | 6.77B | 6.23B |
| Gross Profit | 2.64B | 3.79B | 1.47B | 1.35B | 1.20B | 1.37B |
| EBITDA | 1.26B | 1.24B | 1.28B | 1.23B | 1.31B | 1.62B |
| Net Income | 879.00M | 842.00M | 887.00M | 852.00M | 898.00M | 2.00B |
Balance Sheet | ||||||
| Total Assets | 25.84B | 32.64B | 25.01B | 24.62B | 24.09B | 24.89B |
| Cash, Cash Equivalents and Short-Term Investments | 1.35B | 2.44B | 1.41B | 1.23B | 872.00M | 2.13B |
| Total Debt | 1.82B | 1.82B | 1.90B | 1.83B | 1.69B | 2.20B |
| Total Liabilities | 21.16B | 27.82B | 20.54B | 20.36B | 20.04B | 19.87B |
| Stockholders Equity | 4.68B | 4.82B | 4.47B | 4.26B | 4.05B | 5.01B |
Cash Flow | ||||||
| Free Cash Flow | 1.57B | 1.40B | 1.15B | 1.90B | 1.07B | 1.56B |
| Operating Cash Flow | 1.67B | 1.53B | 1.15B | 1.97B | 1.15B | 1.71B |
| Investing Cash Flow | -1.47B | -835.00M | 95.00M | 414.00M | -1.05B | -436.00M |
| Financing Cash Flow | -117.00M | -377.00M | -1.07B | -2.03B | -1.36B | -1.96B |
American Financial Group Technical Analysis
Positive
131.46
Price Trends
130.15
Positive
129.59
Positive
130.74
Positive
Market Momentum
1.72
Negative
66.24
Neutral
85.17
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AFG, the sentiment is Positive. The current price of 131.46 is below the 20-day moving average (MA) of 132.80, above the 50-day MA of 130.15, and above the 200-day MA of 130.74, indicating a bullish trend. The MACD of 1.72 indicates Negative momentum. The RSI at 66.24 is Neutral, neither overbought nor oversold. The STOCH value of 85.17 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AFG.
American Financial Group Risk Analysis
American Financial Group disclosed 28 risk factors in its most recent earnings report. American Financial Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
American Financial Group Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
85 Outperform | $6.84B | 8.24 | 20.92% | 1.97% | 6.41% | 66.30% | |
80 Outperform | $5.43B | 11.67 | 12.93% | 1.85% | 8.76% | 99.32% | |
78 Outperform | $7.20B | 17.44 | 28.05% | 0.17% | 17.08% | 30.47% | |
76 Outperform | $11.40B | 13.92 | 18.76% | 6.71% | -1.65% | 10.67% | |
73 Outperform | $4.87B | 23.95 | 22.00% | 4.05% | 9.01% | 40.14% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
65 Neutral | $11.99B | 9.61 | 11.94% | 8.03% | 4.05% | 35.90% |
* Financial Sector Average
AFG
American Financial Group
136.69
21.29
18.45%
CNA
CNA Financial
44.05
0.73
1.69%
RLI
RLI
52.56
-19.26
-26.82%
SIGI
Selective Insurance Group
90.70
6.15
7.27%
THG
Hanover Insurance
195.13
30.01
18.18%
KNSL
Kinsale Capital Group
310.19
-152.56
-32.97%
American Financial Group Corporate Events
Business Operations and StrategyStock BuybackDividendsFinancial DisclosuresM&A Transactions
American Financial Group Posts Strong First-Quarter 2026 Results
Positive
Apr 30, 2026
American Financial Group reported strong first-quarter 2026 results on April 29, 2026, with net earnings rising to $191 million, or $2.29 per share, and core net operating earnings increasing to $206 million, or $2.47 per share, up 36% year over y...
Business Operations and StrategyExecutive/Board Changes
American Financial Group Adopts 2026 Executive Incentive Plan
Neutral
Feb 18, 2026
On February 13, 2026, American Financial Group, Inc.’s Compensation Committee approved a new 2026 Senior Executive Long-Term Incentive Compensation Plan to replace a similar program that had been in place since February 23, 2016. The plan co...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.