Cincinnati Financial Corporation CINF has been trading above its 50-day simple moving average (SMA), signaling a short-term bullish trend. Its share price, as of March 25, 2025, was $145.80, down 9.8% from its 52-week high of $161.75.

The 50-day SMA is a key indicator for traders and analysts to identify support and resistance levels. It is considered particularly important as this is the first marker of an uptrend or downtrend.

With a market capitalization of $22.82 billion, the average volume of shares traded in the last three months was 0.8 million.

CINF Price Movement vs. 50-Day Moving Average

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Price Performance

Shares of CINF have gained 18.2% in the past year, outperforming the Finance sector and the S&P 500 composite’s return of 16.4% and 10.4%, respectively. It, however, underperformed the industry’s growth of 22.9%.

CINF Lags Industry, Outperform Sector and S&P 500 in 1 Year

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CINF’s Growth Projection Encourages

The Zacks Consensus Estimate for Cincinnati Financial’s 2025 revenues is pegged at $11.23 billion, implying a year-over-year improvement of 12.9%. The consensus estimate for 2026 earnings per share and revenues indicates an increase of 52.5% and 8%, respectively, from the corresponding 2025 estimates. 

Earnings have grown 15.8% in the past five years. CINF beat earnings estimates in three of the past four quarters and missed in one, with an average surprise of 24.32%.

Attractive Valuation

Its shares are trading at a discount to the Zacks Property and Casualty Insurance industry. Its price-to-book value of 1.64X is lower than the industry average of 1.65X.

Shares of NMI Holdings Inc NMIH are trading at a discount to the industry average, while The Travelers Companies, Inc. TRV and Palomar Holdings, Inc. PLMR are trading at a multiple higher than the industry average.

Factors Acting in Favor of CINF

Prudent pricing, an agent-centric model, a higher level of insured exposures and disciplined expansion of Cincinnati Re should benefit premiums, the primary driver of an insurer’s top line. CINF boasts above-average industry premium growth.

The Excess and Surplus line has been performing well since its inception in 2008. This segment should continue to benefit from new business-written premiums, higher renewal-written premiums and higher average renewal estimated pricing. Technology and data are also used to identify new exposures in emerging businesses.

Improving interest income from fixed-maturity securities and a decrease in equity portfolio dividends in an improved rate environment should drive net investment income.

Notably, its free cash flow conversion has remained more than 150% over the last few quarters, reflecting its solid earnings.

CINF’s Wealth Distribution

In terms of capital management, Cincinnati Financial has returned capital to its shareholders through share buybacks, regular cash dividends, as well as special dividends. The board of directors had increased the annual cash dividend rate for 65 consecutive years. Its dividend yield of 2.2% is better than the industry average of 0.2%, making the stock an attractive pick for yield-seeking investors. The dividend increases reflected strong operating performance and signaled management and the board's positive outlook and confidence in outstanding capital, liquidity and financial flexibility.

Conclusion

Higher level of insured exposure, rate increases, agent-focused business models, consistent cash flow and prudent capital deployment make Cincinnati Financial a strong contender for being in one’s portfolio. 

Favorable estimates and attractive valuation also add to the upside. It is, therefore, wise to hold on to this Zacks Rank #3 (Hold) stock at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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The Travelers Companies, Inc. (TRV) : Free Stock Analysis Report

Cincinnati Financial Corporation (CINF) : Free Stock Analysis Report

NMI Holdings Inc (NMIH) : Free Stock Analysis Report

Palomar Holdings, Inc. (PLMR) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research