NYSE$AFG

American Financial Group Inc · Q1 2023 earnings

Q1 2023 earnings · · Investor relations

Briefing

American Financial Group's first quarter 2023 results were announced, with net earnings per share of $2.49 and core net operating earnings per share of $2.89.

American Financial Group, Inc. reported a strong start to 2023 with a first quarter net earnings of $212 million ($2.49 per share) and core net operating earnings of $247 million ($2.89 per share). The company's annualized core operating return on equity was 22.0%. AFG had approximately $1.0 billion of excess capital at March 31, 2023.

  • Net earnings per share were $2.49, including a $0.40 per share loss from after-tax non-core items.
  • Core net operating earnings per share were $2.89.
  • Annualized ROE was 18.9%, with a core operating ROE of 22.0%.
  • Parent company cash and investments totaled approximately $672 million, with excess capital of $1.0 billion at March 31, 2023.

Headline financials

Total Revenue

$1.74B

Previous: $1.59B+9.6%
EPS (adj)

$2.89

Previous: $3.56-18.8%
Free Cash Flow

$212M

Previous: $290M-26.9%
Net Income

$212M

Previous: $290M-26.9%
Operating Income

$264M

Previous: $361M-26.9%
Gross Profit

$1.74B

Previous: $1.59B+9.6%
Cash & Equivalents

$857M

Previous: $1.18B-27.4%
Total Assets

$28.5B

Previous: $28.8B-1.0%

Revenue & EPS history

AFG · Revenue · Quarterly

$1.74B

Q1 2023+9.6%vs Q1 2022
Beat estimate in 13 of 15 quarters(87%)
ActualEstimate

Revenue by segment

AFG · $1.86B total across 1 segment · Q3 2023

  • Net Earned Premiums
    $1.86B

Forward guidance

AFG expects core net operating earnings per share in 2023 to be in the range of $11.00 to $12.00, which would produce a core return on equity of over 20% at the midpoint. This guidance reflects an average crop year and a return of approximately 8% on alternative investments for the full-year 2023.

Tailwinds

  • Strong underwriting margins in Specialty P&C businesses.
  • Improved investment income due to the higher interest rate environment.
  • Continued strong performance of the alternative investment portfolio.
  • Expects a core return on equity of over 20% at the midpoint.
  • Anticipates a return of approximately 8% on alternative investments for the full year.

Headwinds

  • Guidance excludes non-core items such as realized gains and losses.
  • Guidance reflects an average crop year.
  • Underwriting profit decreased year-over-year due to lower returns in the alternative investment portfolio and lower underwriting profit in the Specialty P&C insurance operations.
  • Alternative investment returns are expected to be lower than the previous year.
  • Acquisition of Crop Risk Services is not expected to materially impact AFG’s reported results for 2023.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2023

Historical avgQ1 2023

+0.2%

Avg return

Earnings day

+0.9%

Avg return

5 days after

+2.8%

Avg return

30 days after

59%

40 / 68 earnings

Positive

+6.7%

Q3 2021

Best reaction

-9.0%

Q1 2020

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.0%-0.8%-2.6%
Q4 2025-0.7%-0.5%+0.4%
Q3 2025+2.7%+8.2%+0.8%
Q1 2025-6.3%-5.0%-3.7%
Q4 2024-6.2%-7.0%-6.5%
Q3 2024+5.5%+9.4%+13.9%
Q2 2024+0.1%+3.2%+7.8%
Q1 2024-0.1%+1.8%+1.7%
Q4 2023+3.1%+3.5%+8.4%
Q3 2023-0.5%+0.9%+6.5%
Q2 2023-7.6%-6.8%-3.6%
Q1 2023-5.8%-5.9%-8.4%
Q4 2022-5.5%-4.2%-6.9%
Q3 2022+0.3%+2.0%-2.3%
Q2 2022-3.4%-1.9%-2.3%
Q1 2022+4.8%+1.8%-1.4%
Q4 2021+2.5%+1.8%+2.2%
Q3 2021+6.7%+5.2%+0.8%
Q2 2021+2.5%+4.4%+9.7%
Q1 2021+0.9%+3.8%+11.3%
Q4 2020+3.2%+10.3%+21.4%
Q3 2020+0.5%+4.1%+25.9%
Q2 2020+1.0%+6.5%+8.5%
Q1 2020-9.0%-17.2%+1.4%
Q4 2019+1.2%+4.1%-12.2%
Q3 2019+0.9%+2.8%+7.9%
Q2 2019+3.0%+5.1%+6.1%
Q1 2019-1.0%+0.7%-5.1%
Q4 2018+1.1%-0.0%+5.7%
Q3 2018-0.1%+0.1%+2.6%
Q2 2018+0.8%+0.4%-1.2%
Q1 2018-3.9%-2.3%-2.5%
Q4 2017+6.4%-1.2%-2.1%
Q3 2017-3.4%-2.5%-0.3%
Q2 2017+3.4%+3.2%+0.4%
Q1 2017+3.7%+1.8%+3.2%
Q4 2016+5.6%+5.6%+10.4%
Q3 2016+2.0%-0.3%+11.2%
Q2 2016-1.4%+0.6%+2.9%
Q1 2016+1.6%
Q4 2015-2.1%
Q3 2015-2.5%
Q2 2015+2.2%
Q1 2015-0.5%
Q4 2014+4.7%
Q3 2014+1.0%
Q2 2014-0.5%
Q1 2014+0.5%
Q4 2013+0.9%
Q3 2013+0.9%
Q2 2013-1.0%
Q1 2013-0.6%
Q4 2012+1.0%
Q3 2012+0.3%
Q2 2012+1.0%
Q4 2008+3.6%
Q4 2009+3.6%
Q1 2012-0.2%
Q4 2011-1.0%
Q3 2011-0.8%
Q4 2010-1.0%
Q2 2011-1.0%
Q1 2010+1.2%
Q1 2011+2.0%
Q3 2010-2.9%
Q3 2009-2.9%
Q2 2010+0.4%
Q2 2009+0.4%

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