Financial Performance Highlights - Net earnings for the three months ended June 30, 2025 were $174 million, while core net operating earnings were $179 million[3] - Diluted earnings per share for the three months ended June 30, 2025 were $207, and core net operating earnings per share were $214[3] - Property and Casualty net written premiums for the three months ended June 30, 2025 were $1803 million[3] - The annualized return on equity was 150%, and the annualized core operating return on equity was 155% for the three months ended June 30, 2025[3] Property and Casualty Insurance Segment - Underwriting profit for Property and Casualty Insurance was $113 million for the three months ended June 30, 2025[5] - Net investment income for Property and Casualty Insurance was $179 million for the three months ended June 30, 2025[5] - The combined ratio for Specialty Property and Casualty was 931% for the three months ended June 30, 2025[3] Balance Sheet and Capitalization - Total assets as of June 30, 2025 were $30669 million[3] - Shareholders' equity, excluding AOCI, was $4648 million as of June 30, 2025[3] - The book value per share, excluding AOCI, was $5574 as of June 30, 2025[3] - Total principal amount of long-term debt was $1498 million as of June 30, 2025[14] Investment Portfolio - Total cash and investments were $16049 million as of June 30, 2025, with fixed maturities representing 66% of the investment portfolio[16, 20] - Average yield on the overall portfolio, net, was 450% for the three months ended June 30, 2025[17]

Core Insights - American Financial Group, Inc. (AFG) reported second-quarter 2025 net operating earnings per share of $2.14, exceeding the Zacks Consensus Estimate by 2.9%, but reflecting a 16.4% year-over-year decline due to reduced underwriting profit and lower returns on alternative investments [1][8]. Financial Performance - Total revenues for the quarter reached $1.8 billion, marking a 3.2% increase year over year, driven by higher property & casualty (P&C) insurance net earned premiums, although it fell short of the Zacks Consensus Estimate by 9.2% [3][8]. - Net investment income decreased by 2.1% year over year to $184 million, which was above internal estimates but below the Zacks Consensus Estimate of $188 million [3][8]. - Total costs and expenses rose by 4% year over year to $1.7 billion, attributed to higher losses, loss adjustment expenses, and commissions, yet this was lower than the internal estimate of $1.8 billion [4]. Segment Analysis - The Specialty P&C Insurance segment generated $1.8 billion in net written premiums, reflecting a 7% year-over-year increase, supported by new business opportunities and favorable renewal rates [5]. - Net written premiums in the Property & Transportation Group grew by 10% year over year to $759 million, although this was below the internal estimate of $853.3 million [6]. - The Specialty Casualty Group saw a 2% year-over-year increase in net written premiums to $765 million, also falling short of the internal estimate [6]. - Specialty Financial net written premiums rose by 12% year over year to $279 million, again below the internal estimate [6]. Underwriting and Profitability - Pre-tax core operating earnings for the P&C Insurance segment were $273 million, down 14.4% year over year [7]. - The underwriting profit for the Specialty P&C Insurance segment decreased by 24.5% year over year to $114 million, with lower profits in Specialty Casualty and Property and Transportation Groups offsetting gains in Specialty Financial [7]. - The combined ratio for the Specialty Group worsened by 260 basis points year over year to 93.1%, influenced by a deterioration of 250 bps in Property & Transportation and 480 bps in Specialty Casualty, despite a 630 bps improvement in Specialty Financial [8][9]. Capital and Returns - As of June 30, 2025, AFG had total cash and investments of $16 billion, a 1.2% increase from the end of 2024, exceeding internal estimates [10]. - Long-term debt remained stable at $1.5 billion, unchanged from the end of 2024 [10]. - The book value per share, excluding accumulated other comprehensive income, was $55.74, down 0.5% from the end of 2024 [10]. - The annualized return on equity for the second quarter was 15%, contracting by 300 basis points year over year [11]. Dividend Policy - AFG paid cash dividends of 80 cents per share during the second quarter [12].

Financial Highlights [Financial Highlights](index=3&type=section&id=Financial%20Highlights) The company reported Q2 2025 net earnings of $174 million and a P&C combined ratio of 93.1% Financial Highlights | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net earnings | $174M | $209M | $328M | $451M | | Core net operating earnings | $179M | $215M | $331M | $446M | | Total assets | $30,669M | $29,913M | $30,669M | $29,913M | | P&C net written premiums | $1,803M | $1,692M | $3,414M | $3,326M | Per Share Data | Per Share Data | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Diluted EPS | $2.07 | $2.49 | $3.92 | $5.38 | | Core net operating EPS | $2.14 | $2.56 | $3.96 | $5.32 | | Book value per share, ex. AOCI | $55.74 | $56.19 | $55.74 | $56.19 | Financial Ratios | Financial Ratios | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Annualized ROE | 15.0% | 18.0% | 14.1% | 19.5% | | Annualized core operating ROE | 15.5% | 18.5% | 14.3% | 19.3% | | P&C Combined ratio - Specialty | 93.1% | 90.5% | 93.6% | 90.2% | Summary of Earnings [Summary of Earnings](index=4&type=section&id=Summary%20of%20Earnings) The P&C segment's operating earnings of $273 million drove core net operating earnings of $179 million for Q2 2025 Earnings Component ($ in millions) | Earnings Component ($ in millions) | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | P&C Underwriting profit | $113 | $150 | $207 | $303 | | P&C Net investment income | $179 | $189 | $349 | $394 | | **P&C Operating earnings** | **$273** | **$319** | **$519** | **$659** | | Pretax core operating earnings | $227 | $273 | $421 | $563 | | **Core net operating earnings** | **$179** | **$215** | **$331** | **$446** | | **Net earnings** | **$174** | **$209** | **$328** | **$451** | [Earnings Per Share Summary](index=5&type=section&id=Earnings%20Per%20Share%20Summary) Q2 2025 diluted EPS was $2.07, derived from core net operating EPS of $2.14 adjusted for non-core items EPS Component | EPS Component | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Core net operating EPS | $2.14 | $2.56 | $3.96 | $5.32 | | Realized gains (losses) on securities | $0.02 | ($0.02) | $0.05 | $0.11 | | Other non-core items | ($0.09) | ($0.05) | ($0.09) | ($0.05) | | **Diluted EPS** | **$2.07** | **$2.49** | **$3.92** | **$5.38** | Property and Casualty Insurance Segment [Summary of P&C Underwriting Results (GAAP)](index=6&type=section&id=Property%20and%20Casualty%20Insurance%20-%20Summary%20Underwriting%20Results%20(GAAP)) The P&C segment's underwriting profit fell to $113 million in Q2 2025, with the combined ratio rising to 93.1% Underwriting Profit ($ in millions) | Underwriting Profit ($ in millions) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Property and Transportation | $27 | $40 | | Specialty Casualty | $49 | $86 | | Specialty Financial | $38 | $25 | | **Total P&C Insurance** | **$113** | **$150** | - Key factors impacting Q2 2025 underwriting results included **$38 million in catastrophe losses** and **$11 million of favorable prior year reserve development**[7](index=7&type=chunk) Combined Ratio | Combined Ratio | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | P&C Combined Ratio | 93.1% | 90.5% | | P&C Combined Ratio (ex-cat & prior year dev.) | 91.5% | 90.5% | [Specialty Group Underwriting Results (GAAP)](index=7&type=section&id=Specialty%20-%20Underwriting%20Results%20(GAAP)) The Specialty group's underwriting profit was $114 million in Q2 2025, with a combined ratio of 93.1% Key Metrics ($ in millions) | Metric ($ in millions) | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Gross written premiums | $2,653 | $2,406 | +10.3% | | Net written premiums | $1,803 | $1,692 | +6.6% | | Underwriting profit | $114 | $151 | -24.5% | Key Ratios | Ratio | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Loss and LAE ratio | 61.1% | 59.1% | | Underwriting expense ratio | 32.0% | 31.4% | | **Combined ratio** | **93.1%** | **90.5%** | [Property and Transportation Underwriting Results (GAAP)](index=8&type=section&id=Property%20and%20Transportation%20-%20Underwriting%20Results%20(GAAP)) The Property and Transportation segment's underwriting profit decreased to $27 million as the combined ratio rose to 95.2% Key Metrics ($ in millions) | Metric ($ in millions) | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net written premiums | $759 | $690 | +10.0% | | Underwriting profit | $27 | $40 | -32.5% | | Combined ratio | 95.2% | 92.7% | +2.5 pts | - The segment experienced **$12 million in catastrophe losses** and **$13 million in favorable prior year reserve development** in Q2 2025[9](index=9&type=chunk) [Specialty Casualty Underwriting Results (GAAP)](index=9&type=section&id=Specialty%20Casualty%20-%20Underwriting%20Results%20(GAAP)) The Specialty Casualty segment's underwriting profit declined to $49 million, with the combined ratio worsening to 93.9% Key Metrics ($ in millions) | Metric ($ in millions) | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net written premiums | $765 | $753 | +1.6% | | Underwriting profit | $49 | $86 | -43.0% | | Combined ratio | 93.9% | 89.1% | +4.8 pts | - The segment recorded **$10 million of adverse prior year loss reserve development** in Q2 2025, a key driver of the higher combined ratio[10](index=10&type=chunk) [Specialty Financial Underwriting Results (GAAP)](index=10&type=section&id=Specialty%20Financial%20-%20Underwriting%20Results%20(GAAP)) The Specialty Financial segment's underwriting profit grew to $38 million, with an improved combined ratio of 86.1% Key Metrics ($ in millions) | Metric ($ in millions) | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net written premiums | $279 | $249 | +12.0% | | Underwriting profit | $38 | $25 | +52.0% | | Combined ratio | 86.1% | 89.7% | -3.6 pts | - The segment's results included **$19 million in catastrophe losses** and **$9 million in favorable prior year reserve development** in Q2 2025[11](index=11&type=chunk) Balance Sheet and Capitalization [Consolidated Balance Sheet](index=11&type=section&id=Consolidated%20Balance%20Sheet) Total assets were $30.67 billion and shareholders' equity was $4.52 billion as of June 30, 2025 Balance Sheet ($ in millions) | Balance Sheet Item ($ in millions) | 6/30/2025 | 12/31/2024 | | :--- | :--- | :--- | | Total cash and investments | $16,049 | $15,852 | | **Total assets** | **$30,669** | **$30,836** | | Unpaid losses and loss adjustment expenses | $13,834 | $14,179 | | Long-term debt | $1,476 | $1,475 | | **Total liabilities** | **$26,153** | **$26,370** | | **Total shareholders' equity** | **$4,516** | **$4,466** | [Book Value Per Share and Price / Book Summary](index=12&type=section&id=Book%20Value%20Per%20Share%20and%20Price%20%2F%20Book%20Summary) Book value per share excluding AOCI was $55.74 as of June 30, 2025, with a price-to-book ratio of 2.26x Per Share Metrics | Per Share Metric | 6/30/2025 | 6/30/2024 | | :--- | :--- | :--- | | Book value per share | $54.15 | $52.25 | | Book value per share, excluding AOCI | $55.74 | $56.19 | | Tangible book value per share, excluding AOCI | $49.77 | $50.13 | - The company's **market capitalization was $10.52 billion** based on the closing share price of $126.21 on June 30, 2025[13](index=13&type=chunk) [Capitalization](index=13&type=section&id=Capitalization) The company's debt-to-total capital ratio (excluding AOCI) was 24.4% with total capital of $6.15 billion Capitalization ($ in millions) | Capitalization ($ in millions) | 6/30/2025 | 12/31/2024 | | :--- | :--- | :--- | | Total principal amount of long-term debt | $1,498 | $1,498 | | Shareholders' equity | $4,516 | $4,466 | | **Total capital, excluding AOCI** | **$6,146** | **$6,204** | Capital Ratios | Ratio | 6/30/2025 | 12/31/2024 | | :--- | :--- | :--- | | Debt to total capital, ex. AOCI (incl. subordinated) | 24.4% | 24.1% | | Debt to total capital, ex. AOCI (excl. subordinated) | 13.4% | 13.3% | Additional Supplemental Information [Additional Supplemental Information](index=14&type=section&id=Additional%20Supplemental%20Information) The P&C segment had paid losses of $931 million in Q2 2025 and dividend capacity of $1.00 billion - Property and Casualty Insurance **paid losses (GAAP) were $931 million** in Q2 2025, compared to $969 million in Q2 2024[15](index=15&type=chunk) - As of June 30, 2025, the Property and Casualty Insurance subsidiaries had the capacity to pay **$1.004 billion in dividends** to the parent company without requiring prior regulatory approval[15](index=15&type=chunk) Investment Portfolio [Total Cash and Investments](index=15&type=section&id=Total%20Cash%20and%20Investments) Total cash and investments reached $16.05 billion, with fixed maturities comprising 65% of the portfolio Investment Portfolio Composition ($ in millions) | Investment Type ($ in millions) | Carrying Value 6/30/2025 | % of Portfolio | Carrying Value 12/31/2024 | % of Portfolio | | :--- | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $1,268 | 8% | $1,406 | 9% | | Fixed maturities - Available for sale | $10,489 | 65% | $10,398 | 66% | | Investments using equity method | $2,341 | 15% | $2,277 | 14% | | Mortgage loans | $909 | 6% | $791 | 5% | | **Total cash and investments** | **$16,049** | **100%** | **$15,852** | **100%** | [Net Investment Income](index=16&type=section&id=Net%20Investment%20Income) P&C net investment income decreased to $179 million in Q2 2025 due to lower alternative investment returns P&C Net Investment Income ($ in millions) | P&C Net Investment Income ($ in millions) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Fixed maturities | $140 | $133 | | Alternative investments | $8 | $33 | | Other investments | $38 | $28 | | Investment expenses | ($7) | ($5) | | **Total net investment income** | **$179** | **$189** | - The average yield on the P&C fixed maturities portfolio before investment expenses **increased to 5.24%** in Q2 2025 from 5.04% in Q2 2024[17](index=17&type=chunk) [Alternative Investments](index=17&type=section&id=Alternative%20Investments) Alternative investment income fell to $8 million in Q2 2025, yielding an annualized return of 1.2% P&C Alternative Investments | P&C Alternative Investments | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Investment Income | $8M | $33M | | Total Investments (Carrying Value) | $2,774M | $2,614M | | Annualized Return | 1.2% | 5.1% | [Fixed Maturities by Security Type](index=18&type=section&id=Fixed%20Maturities%20-%20By%20Security%20Type%20-%20AFG%20Consolidated) The $10.57 billion fixed maturities portfolio was well-diversified with a duration of 3.0 years Fixed Maturities by Security Type | Security Type | Fair Value 6/30/2025 ($M) | % of Fair Value | | :--- | :--- | :--- | | Corporate and other bonds | $3,482 | 33% | | Other asset-backed securities | $2,406 | 23% | | Residential mortgage-backed securities | $2,217 | 21% | | Collateralized loan obligations | $1,088 | 10% | | States, municipalities, etc. | $868 | 8% | | **Total AFG consolidated** | **$10,571** | **100%** | - The approximate duration of the Property & Casualty fixed income portfolio was **3.0 years** as of June 30, 2025, slightly down from 3.1 years at year-end 2024[21](index=21&type=chunk) Appendix [Appendix A: Fixed Maturities by Credit Rating (6/30/2025)](index=19&type=section&id=A.%20Fixed%20Maturities%20by%20Credit%20Rating%20%26%20NAIC%20Designation%20by%20Type%206%2F30%2F2025) The fixed maturities portfolio maintained high credit quality, with 95% of assets rated investment grade - **95% of the fixed maturities portfolio is rated investment grade**[23](index=23&type=chunk) Credit Rating Breakdown | Credit Rating | Fair Value ($ in millions) | % of Total | | :--- | :--- | :--- | | AAA | $4,238 | 40% | | AA | $1,482 | 14% | | A | $1,747 | 17% | | BBB | $2,553 | 24% | | **Subtotal - Investment Grade** | **$10,020** | **95%** | [Appendix G: Real Estate-Related Investments (6/30/2025)](index=25&type=section&id=G.%20Real%20Estate-Related%20Investments%206%2F30%2F2025) Real estate investments were concentrated in multi-family properties, which showed strong occupancy and collection rates Real Estate Investments by Category | Investment Category | Book Value ($ in millions) | | :--- | :--- | | Investments accounted for using equity method | $1,413 | | Mortgage Loans | $909 | | Real Estate (Direct) | $101 | - The multi-family equity method investments, the largest component of real estate exposure, maintained a **high occupancy rate of 92%** and a **collection rate of 97%** for the second quarter[36](index=36&type=chunk)[39](index=39&type=chunk) - **No mortgage loans** were receiving interest deferral through forbearance agreements[38](index=38&type=chunk)

View all Key Company Metrics for American Financial here>>> Shares of American Financial have returned -2.2% over the past month versus the Zacks S&P 500 composite's +1% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. Property and Transportation - Loss and LAE Ratio: 67.2% versus the four-analyst average estimate of 66.7%. Property and Transportation - Combined Ratio: 95.2% versus 96.4% estimated by four analysts on a ...

Core Viewpoint - American Financial Group (AFG) reported quarterly earnings of $2.14 per share, exceeding the Zacks Consensus Estimate of $2.08 per share, but down from $2.56 per share a year ago, indicating a mixed performance in earnings [1][2]. Earnings Performance - The earnings surprise for the quarter was +2.88%, while the previous quarter saw a surprise of -16.59% with actual earnings of $1.81 per share against an expectation of $2.17 [1][2]. - Over the last four quarters, AFG has surpassed consensus EPS estimates only once [2]. Revenue Analysis - AFG's revenues for the quarter ended June 2025 were $1.86 billion, missing the Zacks Consensus Estimate by 9.22%, compared to $1.8 billion in the same quarter last year [2]. - The company has exceeded consensus revenue estimates two times in the last four quarters [2]. Stock Performance - AFG shares have declined approximately 9.7% since the beginning of the year, contrasting with the S&P 500's gain of 7.6% [3]. Future Outlook - The company's earnings outlook will be crucial for investors, particularly in light of management's commentary during the earnings call [4]. - Current consensus EPS estimate for the upcoming quarter is $2.75 on revenues of $2.19 billion, and for the current fiscal year, it is $9.88 on revenues of $8.22 billion [7]. Industry Context - The Insurance - Property and Casualty industry, to which AFG belongs, is currently ranked in the bottom 42% of over 250 Zacks industries, indicating potential challenges ahead [8].

Core Insights - American Financial Group, Inc. (AFG) has underperformed compared to its industry and broader market indices over the past year, with a share price increase of 6.5% versus 16.9% for the Finance sector and 21.1% for the Zacks S&P 500 composite [1] - AFG's current market capitalization stands at $10.64 billion, with a recent share price of $127.43, which is 15.1% lower than its 52-week high of $150.19 [2] - The company is trading at a forward 12-month price-to-book ratio of 2.43X, significantly above the industry average of 1.55X, indicating an expensive valuation [3] - The Zacks Consensus Estimate projects AFG's revenues for 2025 to be $8.21 billion, reflecting a year-over-year growth of 2.1% [4] - AFG has maintained a combined ratio better than the industry average for over 20 years, with a target of 92.5% for 2025 [7] - The company has a strong dividend history, with 18 consecutive years of increases and a 10-year compound annual growth rate (CAGR) of 12.4% [16][17] - Analysts have shown bearish sentiment, with three out of four lowering their earnings estimates for 2025 and 2026 over the past 60 days [8] - The average price target from analysts suggests a potential upside of 5.5% from the last closing price, with a target of $132.20 per share [9] - AFG's return on equity (ROE) has improved, currently at 18.3%, compared to the industry average of 7.8% [11] - The company is well-positioned for growth due to new business opportunities, a favorable renewal rate environment, and strategic acquisitions [12][19]

A month has gone by since the last earnings report for American Financial Group (AFG) . Shares have added about 1.5% in that time frame, underperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is American Financial due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.How Have Estimates Been Moving ...

Group 1 - The article highlights investment-grade long-term bonds with yields close to 7.6% as undervalued opportunities in exchange-traded debt securities [1] - The focus is on a company in the insurance sector, indicating a specific sector of interest for potential investments [1] - The service "Trade With Beta" offers features such as frequent picks for mispriced preferred stocks and baby bonds, along with weekly reviews of over 1200 equities [1] Group 2 - The article emphasizes the importance of active investor engagement and provides a platform for discussion among sophisticated traders and investors [1] - The analyst has disclosed a beneficial long position in the shares of AFGC, indicating a vested interest in the company's performance [1]

Group 1 - The articles emphasize the immunity that fixed-income securities provide against everyday market sentiment, highlighting their stability in uncertain market conditions [1] - The focus is on High Dividend Opportunities, which are presented as a reliable investment strategy for generating income [1] Group 2 - The company promotes a portfolio strategy that allows investors to earn income without the need to sell assets, aiming to simplify retirement investing [4] - The Income Method is highlighted as a way to achieve strong returns, targeting a yield of 9-10% [4] - A month-long paid trial is offered at $49, with an additional 5% discount, to attract new investors to their Model Portfolio [4]

Core Viewpoint - American Financial Group, Inc. (AFG) is experiencing a short-term bullish trend despite a recent decline in share price, with potential growth driven by strategic acquisitions and improved underwriting performance [1][18]. Price Movement - AFG's share price is currently $127.14, down 15.3% from its 52-week high of $150.19, while trading above its 50-day simple moving average (SMA) [1]. Valuation - AFG's forward 12-month price-to-book ratio stands at 2.41X, exceeding the industry average of 1.58X, indicating an expensive valuation [4]. Price Performance - Over the past year, AFG shares have decreased by 4.2%, contrasting with the industry's growth of 22.5%, the Finance sector's return of 18.1%, and the S&P 500's appreciation of 11.6% [5][6]. Growth Projections - The Zacks Consensus Estimate projects AFG's 2025 revenues at $8.21 billion, reflecting a year-over-year increase of 2.1%, with further growth anticipated in 2026 [8]. Analyst Sentiment - Analyst sentiment has turned bearish, with the consensus estimate for 2025 earnings down by 0.5% and for 2026 down by 0.7% over the past 30 days [9]. Return on Capital - AFG's return on equity (ROE) for the trailing 12 months is 18.3%, significantly higher than the industry average of 7.8%, indicating effective use of shareholders' funds [10]. Growth Factors - AFG is well-positioned for growth due to new business opportunities, a favorable renewal rate environment, and strategic acquisitions, particularly in the Crop Risk Services segment [11][12]. Combined Ratio - AFG has maintained a combined ratio better than the industry average for over two decades, with an expected combined ratio of 92.5% for 2025 [13]. Dividend Distribution - The company has increased its dividend for 18 consecutive years, reflecting financial stability and robust operating profitability, with a dividend yield of 2.5%, surpassing the industry average of 0.2% [14][16]. Conclusion - Despite an expensive valuation and bearish analyst sentiment, AFG's strategic initiatives and favorable growth estimates make it an attractive stock to hold [17][18].