American Financial Group, Inc.

American Financial Group's specialty-focused portfolio is positioned to keep premium growth above the broader P&C market, though the source of that outperformance is shifting from pricing toward new business, exposure growth and market-share gains. In the second quarter of 2026, AFG's Specialty P&C net written premiums rose 6% year over year, against a broader U.S. P&C market where premium growth has flattened, with gains across all three of its Specialty P&C groups. Within that mix, Property & Transportation net written premiums rose 5%, Specialty Casualty increased 6%, and Specialty Financial grew 10%, the last achieved even as renewal pricing declined by less than 1%. The company faces a softening backdrop: Marsh reported U.S. commercial insurance rates declined 2% in second-quarter 2026, and Swiss Re expects U.S. P&C premium growth to slow to around 3% in 2026. AFG shares have gained 2% year to date, and the Zacks Consensus Estimate for third-quarter 2026 moved up 19.4% over the past 60 days, while fourth-quarter 2026 EPS moved down 0.3% and full-year 2026 and 2027 EPS moved up 8.1% and 0.2%, respectively.

American Financial Group posted core net operating earnings of $2.82 per diluted share for the second quarter of 2026, a 32% increase driven by higher underwriting profit and improved returns from alternative investments. Net earnings reached $248 million, or $2.99 per share, including $0.17 per share in after-tax non-core realized gains on securities. Property and casualty pretax operating income hit a second-quarter record of $350 million, while the specialty P&C combined ratio improved 1.6 points to 91.5%. Net written premiums grew 6% to $1.92 billion, and the company returned nearly $100 million to shareholders through $26 million in share repurchases and $74 million in dividends. Management also highlighted an expected $125 million pretax gain from the pending sale of the Charleston Harbor Resort, which would contribute approximately $1.20 per share upon closing in the third quarter.

American Financial Group reported second-quarter earnings per share of $2.82, surpassing the Zacks Consensus Estimate of $2.41 by 17.01 percent. Revenue reached $1.94 billion, up 4.6 percent from a year ago and slightly above the $1.93 billion consensus. The property and casualty combined ratio for the specialty segment came in at 91.5 percent, better than the 92.9 percent analysts had expected. Net investment income rose 20.1 percent to $221 million, exceeding the $197.85 million estimate, while net earned premiums of $1.69 billion fell short of the $1.75 billion forecast.

Zacks Equity Research highlights American International Group, American Financial Group, and Accelerant Holdings as buy-rated insurance stocks with strong earnings momentum. American International Group saw first-quarter 2026 general insurance net premiums written rise 24% year over year and underwriting income more than triple to $774 million, with a combined ratio of 87.3%. American Financial Group's first-quarter net operating earnings increased 36.5% and specialty P&C underwriting profit jumped 66%, driving an annualized return on equity of 15.8%. Accelerant Holdings reported a 16% increase in exchange written premium to $1.14 billion and a 57% rise in operating revenues to $273.2 million, with fee-based adjusted EBITDA more than doubling. All three companies carry a Zacks Rank #2 (Buy) and have seen positive earnings estimate revisions.

American Financial Group increased its annual dividend by 10% to $3.52 per share in August 2025, marking its 20th consecutive year of dividend increases. The company's 10-year dividend compound annual growth rate is approximately 12.3%. In February 2026, the board declared a special cash dividend of $1.50 per share, totaling approximately $125 million. During the first quarter of 2026, AFG repurchased approximately $60 million of shares and returned nearly $260 million to shareholders through regular dividends, special dividends, and share repurchases.