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Will CNA Financial (CNA) Miss Earnings Estimate This Season?

Zacks Equity Research

CNA Financial Corporation (CNA) is set to report second-quarter 2014 results on Aug 4. Last quarter, the company posted a 15.66% negative earnings surprise. Let’s see how things are shaping up for this announcement.

Factors Influencing This Past Quarter

A continued low interest rate environment is likely to weigh upon investment results and in turn hurt the CNA Financial’s bottom line.

However, the company remains focused on improving its performance in specialty, hardy and long-term care businesses. In addition, its middle market business is also gaining momentum.

With the sale of Continental Assurance Company, the company can heighten its focus in its core operation.  

Earnings Whispers

Our proven model does not conclusively show that CNA Financial is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are currently pegged at 82 cents.

Zacks Rank: CNA Financial carries a Zacks Rank #3 (Hold). Though a Zacks Rank #1, 2 or 3 increases the predictive power of ESP, the company’s ESP of 0.00% makes surprise prediction difficult.

Other Stocks to Consider

Here are some companies you may want to consider as our model shows these have the right combination of elements to post an earnings beat this quarter:  

National General Holdings Corp. (NGHC), Earnings ESP of +8.0% and a Zacks Rank #1 (Strong Buy).

Qiwi plc (QIWI), Earnings ESP of +4.76% and a Zacks Rank #3.

Voya Financial, Inc. (VOYA), earnings ESP of +2.86% and a Zacks Rank #3.

Read the Full Research Report on CNA
Read the Full Research Report on QIWI
Read the Full Research Report on NGHC
Read the Full Research Report on VOYA

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