Interested In CNA Financial Corporation (NYSE:CNA)? Here’s What Its Recent Track-Record Looks Like
For long-term investors, assessing earnings trend over time and against industry benchmarks is more beneficial than examining a single earnings announcement at a point in time. Investors may find my commentary, albeit very high-level and brief, on CNA Financial Corporation (NYSE:CNA) useful as an attempt to give more color around how CNA Financial is currently performing. Check out our latest analysis for CNA Financial
Did CNA beat its long-term earnings growth trend and its industry?
I use the ‘latest twelve-month’ data, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This allows me to assess various companies in a uniform manner using the latest information. CNA Financial’s latest twelve-month earnings is $917.0M, which, in comparison to the prior year’s level, has moved up by a significant 67.34%. Given that these values may be somewhat short-term, I have created an annualized five-year value for CNA Financial’s net income, which stands at $731.8M. This shows that, on average, CNA Financial has been able to increasingly raise its earnings over the past few years as well.
What’s enabled this growth? Let’s take a look at if it is merely due to an industry uplift, or if CNA Financial has seen some company-specific growth. In the past few years, CNA Financial expanded its bottom line faster than revenue by successfully controlling its costs. This brought about a margin expansion and profitability over time. Inspecting growth from a sector-level, the US insurance industry has been growing, albeit, at a subdued single-digit rate of 6.32% in the prior year, and 8.46% over the past couple of years. This shows that any tailwind the industry is benefiting from, CNA Financial is capable of leveraging this to its advantage.
What does this mean?
Though CNA Financial’s past data is helpful, it is only one aspect of my investment thesis. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? I recommend you continue to research CNA Financial to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for CNA’s future growth? Take a look at our free research report of analyst consensus for CNA’s outlook.
2. Financial Health: Is CNA’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
