American Financial Group Q2 revenue beats, helped by premium growth
AFG•Key details
| Metric | Beat/Miss | Actual | Consensus Estimate |
|---|---|---|---|
| Q2 Revenue | Beat | $2.03 bln | $1.73 bln (5 Analysts) |
| Q2 EPS | $2.99 | ||
| Q2 Net Income | $248 mln | ||
| Q2 Adjusted EBIT | $66 mln | ||
| Q2 Pretax Profit | $316 mln |
Company press release: ID:nBw5tSPR7a
Q2 results and key drivers
- U.S. specialty insurer's Q2 revenue rose and beat analyst expectations
- Core net operating EPS for Q2 increased year-over-year
- Company repurchased $26 mln of stock during the quarter
Higher year-over-year underwriting profit, especially in Property and Transportation, drove Q2 results. Net investment income rose 23% year-over-year, primarily due to higher yields on alternative investments. Net written premiums grew 6% in Q2, supported by new business, increased exposures, and favorable renewal rates.
Outlook and analyst coverage
- Company expects to recognize a pretax core operating gain of about $125 mln in Q3 from asset sale
- Company remains optimistic about long-term returns from alternative investments, targeting 10% or better annually
- Company plans to deploy capital into core businesses and pursue organic growth and niche acquisitions
