American Financial (AFG) Boosts Quarterly Dividend by 12.7%

Dividend Increase and Shareholder Returns - American Financial Group (AFG) announced a 12.7% increase in its annual common stock dividend, raising it to $3.20 per share from$2.84 [1] - The company will disburse the increased dividend quarterly at 80 cents per share starting October 2024 [1] - AFG's dividend yield is 2.1%, significantly higher than the industry average of 0.2% [1] - The company has a 10-year compound annual growth rate for dividends of 12.4% [2] - AFG returned $59 million to shareholders through regular quarterly dividends and paid a special dividend of$2.50 per share, totaling approximately $209 million in Q2 2024 [4] Financial Strength and Capital Management - AFG maintains a moderate adjusted financial leverage of around 20$438 million in cash and investments [3] - The company has increased its dividends for 18 consecutive years [3] - AFG's return on equity (ROE) was 21.6% in the trailing 12 months, compared to the industry average of 7.9% [4] - The company expects to generate significant excess capital in 2024, providing opportunities for additional share repurchases or special dividends [4] Industry Comparison and Performance - AFG shares have gained 14.4% in the past year, while the industry has grown by 27.5% [5] - MGIC Investment Corporation (MTG) also increased its quarterly dividend by 13% to 13 cents per share, reflecting strong financial performance and capital position [7] - NMI Holdings Inc (NMIH) and Arch Capital Group Ltd (ACGL) are better-ranked stocks in the property and casualty insurance industry, each carrying a Zacks Rank 2 (Buy) [8] - NMIH shares have jumped 37.8% in a year, with earnings surpassing estimates in the last four quarters by an average of 10.15% [8] - ACGL shares have jumped 40.3% in a year, with earnings surpassing estimates in the last four quarters by an average of 28.93% [8]