Cincinnati Financial’s (CINF) first quarter earnings disappointed the Zacks Consensus Estimate, primarily due to lower-than-expected earned premium. Its Commercial Lines segment prime premium contributor has been suffering from soft market conditions, exerting downward pressure on pricing and restricting growth.

Not much improvement is expected here in 2010. However, its Personal Lines segment is expected to clock modest positive growth. Then again, we remain cautious on the investment portfolio with an above-average equity concentration.

Our six-month target price of $24.00 equates to about 14.8X our earnings estimate for 2010. We view $1.58 per common share annual dividend as secure, implying a negative return of about 6.9%.

Zacks Investment Research

1. (PNC) PNC Financial Services Group Exits TARPPNC Financial Services Group (PNC) has set itself free from the Troubled Asset Relief Program...
2. (CINF) Cincinnati Financial Reports One Cent Ahead of ExpectationsCincinnati Financial’s (CINF) fourth quarter net income of 53 cents per share was a penny...
3. (PNC) PNC Financial Services to Close 22 Cincinnati BranchesPNC Financial Services (PNC) yesterday announced that it will close down 22 of its Cincinnati...
4. (CBB) Cincinnati Bell Reports Earnings – Reaffirms OutlookCincinnati Bell (CBB) announced third quarter results with adjusted earnings per share of 11 cents,...
5. (ABB) Zacks #5 Rank Additions for Tuesday – Zacks Tale of the TapeHere are the stocks added to the Zacks #5 Rank (“strong sell”) List today: ABB...
6. (BR) Broadridge Financial Solutions – outsourcing solutions to the financial services industryBroadridge Financial Solutions, Inc. (BR) has been on a very nice rally since mid November,...

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