Today: The Zacks Investment Research Downgrades American Financial Group Inc. (AFG) to Sell

The Zacks Investment Research Downgrades American Financial Group Inc. (AFG) to Sell

American Financial Group Inc. (NYSE:AFG) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a report released on Wednesday.

According to Zacks, “Exposure catastrophe loss is a risk to American Financial’s underwriting results as is a soft interest rate environment on investment. Nonetheless, the company is well poised to benefit from impressive inorganic growth deals and restructuring initiatives. An agreement to acquire the leftover shares of National Interstate shows prudence of investing in business that it knows best.  Better industry fundamentals, with strong pricing and a higher renewal ratio, should drive overall growth. A strong balance sheet, low leverage cost, and disciplined capital management (raised dividend by 12% in Aug 2016) are positives. Notably, the Zacks Consensus Estimate dipped 0.2% for 2016, but the same inched up 0.3% for 2017, over the last 60 days. However, based on strong results through the first half the company expects earnings of $5.35 – $5.75 per share in 2016.”

AFG has been the subject of several other reports. Sandler O’Neill upgraded American Financial Group from a “hold” rating to a “buy” rating and boosted their price objective for the stock from $74.00 to $81.00 in a research report on Friday, August 12th. Janney Montgomery Scott restated a “buy” rating on shares of American Financial Group in a research report on Thursday, June 30th.

Shares of American Financial Group (NYSE:AFG) opened at 75.75 on Wednesday. The stock has a market cap of $6.58 billion, a P/E ratio of 19.36 and a beta of 0.76. American Financial Group has a 12 month low of $64.87 and a 12 month high of $76.93. The stock has a 50 day moving average price of $75.04 and a 200-day moving average price of $72.48.

American Financial Group (NYSE:AFG) last issued its quarterly earnings data on Tuesday, August 2nd. The company reported $1.28 earnings per share (EPS) for the quarter, topping the Thomson Reuters’ consensus estimate of $1.27 by $0.01. The business earned $1.58 billion during the quarter, compared to the consensus estimate of $1.06 billion. American Financial Group had a return on equity of 9.74% and a net margin of 5.46%. The business’s revenue was up 4.3% on a year-over-year basis. During the same period in the previous year, the firm posted $1.28 earnings per share. On average, analysts forecast that American Financial Group will post $5.70 EPS for the current fiscal year.

The company also recently announced a quarterly dividend, which will be paid on Tuesday, October 25th. Shareholders of record on Friday, October 14th will be given a $0.3125 dividend. This represents a $1.25 dividend on an annualized basis and a yield of 1.65%. This is an increase from American Financial Group’s previous quarterly dividend of $0.28. The ex-dividend date is Wednesday, October 12th. American Financial Group’s dividend payout ratio is 31.89%.

In other news, Director Terry S. Jacobs sold 400 shares of the stock in a transaction on Friday, September 23rd. The stock was sold at an average price of $75.57, for a total transaction of $30,228.00. Following the completion of the sale, the director now owns 2,000 shares in the company, valued at approximately $151,140. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, VP Vito C. Peraino sold 2,450 shares of the stock in a transaction on Thursday, September 1st. The shares were sold at an average price of $75.09, for a total value of $183,970.50. Following the sale, the vice president now owns 81,032 shares of the company’s stock, valued at approximately $6,084,692.88. The disclosure for this sale can be found here. 14.90% of the stock is owned by company insiders.

Several large investors have recently made changes to their positions in the stock. Advisor Group Inc. bought a new stake in shares of American Financial Group during the second quarter worth approximately $108,000. IFP Advisors Inc increased its stake in shares of American Financial Group by 97.3% in the first quarter. IFP Advisors Inc now owns 2,129 shares of the company’s stock worth $150,000 after buying an additional 1,050 shares during the period. Checchi Capital Advisers LLC increased its stake in shares of American Financial Group by 2.1% in the second quarter. Checchi Capital Advisers LLC now owns 2,028 shares of the company’s stock worth $150,000 after buying an additional 42 shares during the period. Advisor Partners LLC bought a new stake in shares of American Financial Group during the second quarter worth approximately $212,000. Finally, Commerce Bank bought a new stake in shares of American Financial Group during the second quarter worth approximately $217,000. Institutional investors own 59.90% of the company’s stock.

About American Financial Group

American Financial Group, Inc (AFG) is a holding company engaged primarily in property and casualty insurance businesses. The Company, through Great American Insurance Group, focuses on commercial products for businesses, and is engaged in the sale of fixed and fixed-indexed annuities in the retail, financial institutions and education markets.

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