CNA Financial Corporation Fourth Quarter 2025 Results February 09, 2026 Notices and Disclaimers Forward Looking Statements The statements made in the course of this presentation and/or contained in the presentation materials may include statements that relate to anticipated future events (forward-looking statements) rather than actual present conditions or historical events. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and generally ...

Core Viewpoint - AM Best has upgraded the credit ratings of CNA Financial Corporation and its subsidiaries, reflecting strong financial performance and support from its parent company, Loews Corporation [1][4]. Group 1: Credit Ratings Upgrade - Financial Strength Rating (FSR) upgraded to A+ from A, and Long-Term Issuer Credit Ratings (Long-Term ICRs) upgraded to "aa-" from "a+" [2]. - CNAF's Long-Term Issue Credit Ratings (Long-Term IRs) also upgraded, with Long-Term ICR rising to "a-" from "bbb+" [2]. Group 2: Financial Performance and Support - CNA's ratings are based on a very strong balance sheet, strong operating performance, favorable business profile, and appropriate Enterprise Risk Management (ERM) [3]. - The supportive ownership by Loews Corporation and historical financial backing contribute positively to CNA's ratings [4]. Group 3: Operating Platform and Profitability - CNA's favorable operating platform includes considerable geographic and product scope, strong service capabilities, and diversified distribution [5]. - Successful underwriting and expense management initiatives have made commercial insurance a significant source of profitability [5]. Group 4: Risk Factors - The ratings consider the impact of discontinued long-term care business, which has affected overall profitability and risk-adjusted capitalization [6]. - Moderate underwriting exposures to catastrophe losses and reserve uncertainties in litigation-sensitive casualty lines could affect the credit profile [7]. Group 5: Western Surety Group (WSG) Ratings - WSG's strong financial profile reflects strong risk-adjusted capitalization, favorable loss reserves, and modest underwriting leverage [8]. - However, WSG's narrow product focus in a competitive surety market is a potential weakness that may pressure underwriting margins [9].

Financial Highlights - Net income decreased by 6% from $317 million to $299 million, while core income increased by 3% from $326 million to $335 million[6] - Net investment income increased by 7% to $662 million pretax, driven by increases in both fixed income securities and limited partnerships/common stock[6] - The book value per share excluding AOCI increased by 4% from year-end 2024, adjusting for $2.92 of dividends per share paid[6] Property & Casualty Operations - The P&C combined ratio improved slightly from 948% to 941%, with catastrophe losses impacting 24 points compared to 35 points in the prior year quarter[6] - P&C segments, excluding third-party captives, experienced gross written premium growth of 5% and net written premium growth of 6%[6] - The underlying combined ratio for P&C was 917%, compared to 916% in the prior year quarter[6] Segment Performance - Specialty segment GWP ex third party captives increased by 3% from $984 million to $1013 million[10] - Commercial segment GWP ex third party captives increased by 6% from $1802 million to $1903 million[12] - International segment NWP increased by 9% from $359 million to $391 million[14] Investment Portfolio and Capital - Fixed income securities net investment income increased from $520 million to $544 million[19] - Limited Partnership & Common Stock net investment income increased from $78 million to $100 million[22] - The company maintains a high-quality investment portfolio, with 88% of total invested assets in fixed income securities and an average credit rating of "A"[30]

Core Insights - CNA Financial Corporation (CNA) shares are trading at a discount compared to the Zacks Property and Casualty Insurance industry, with a forward price-to-book value of 1.22X, lower than the industry average of 1.57X, the Finance sector's 4.23X, and the Zacks S&P 500 Composite's 8.3X [1] - The market capitalization of CNA is $12.59 billion, with an average trading volume of 0.4 million shares over the last three months [1] Valuation and Price Performance - CNA Financial shares closed at $46.53, representing an 11% discount from its 52-week high of $52.36, indicating potential for growth [3] - The average price target for CNA is $49 per share, suggesting a potential upside of 5.38% from the last closing price [11] Growth Projections - The Zacks Consensus Estimate for CNA Financial's 2025 revenues is $13.43 billion, reflecting a year-over-year improvement of 5.4% [4] - The consensus estimate for 2026 earnings per share and revenues indicates increases of 11.7% and 3.5%, respectively, from the 2025 estimates [4] Analyst Sentiment - Mixed analyst sentiment is observed, with two analysts lowering estimates for 2025 while one raised estimates for 2026 over the past 60 days; the 2025 earnings estimate has decreased by 6%, while the 2026 estimate has increased by 1.3% [5] Financial Performance - CNA Financial has a trailing 12-month return on equity (ROE) of 11.9%, outperforming the industry average of 7.8% [13] - The company has experienced a 2.3% share price gain over the past year, compared to the industry growth of 19.2%, the Finance sector's 19.9%, and the Zacks S&P 500 composite's 11.7% [9] Business Strategy and Capital Management - CNA drives premium growth through strong retention, favorable renewal premium changes, and new business gains [8] - The company maintains a solid balance sheet with capital above target levels, exiting the first quarter with statutory capital and surplus of $11 billion [15] - CNA has a history of rewarding shareholders through regular dividend hikes, with a 10-year CAGR of 6.3% and a current dividend yield of 3.6%, significantly higher than the industry average of 0.2% [17] Future Outlook - Favorable growth estimates, higher return on capital, and attractive valuation position CNA for long-term value creation [18] - The company is expected to continue benefiting from solid retention, favorable renewal premium changes, and new business growth across its segments [18]

Financial Performance - Net income decreased to $274 million, a 19% decrease compared to $338 million in the prior year quarter[7,8] - Core income decreased to $281 million, a 21% decrease compared to $355 million in the prior year quarter[7,8] - Core ROE decreased by 2.3 percentage points to 9.2% compared to 11.5% in the prior year quarter[8] Property & Casualty Operations - P&C core income was $311 million, reflecting lower underwriting results partially offset by higher net investment income, compared to $372 million in the prior year[7] - The P&C combined ratio increased to 98.4%, compared to 94.6% in the prior year quarter, including 3.8 points of catastrophe loss impact in both quarters[7,9] - P&C underlying combined ratio increased to 92.1%, compared with 91.0% in the prior year quarter[7,9] - P&C segments, excluding third party captives, generated gross written premium growth of 7% and net written premium growth of 9%[7,9] Investments - Net investment income was $604 million pretax, reflecting a $14 million decrease from limited partnerships and common stock to $54 million, partially offset by a $9 million increase from fixed income securities and other investments to $550 million[7,22,23] - Fixed income securities net investment income is up 4% year-over-year[28] Capital Management - Book value per share excluding AOCI increased 2% from year-end 2024, adjusting for $2.46 of dividends per share paid, reaching $44.58[7,38]