3 Stocks Pushing The Insurance Industry Lower

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The Insurance industry as a whole closed the day down 0.1% versus the S&P 500, which was unchanged. Laggards within the Insurance industry included Kingstone Companies ( KINS), down 1.6%, First Acceptance ( FAC), down 7.4%, Investors Title ( ITIC), down 2.1%, 1347 Property Insurance Holdings ( PIH), down 5.6% and State Auto Financial ( STFC), down 1.7%.

TheStreet Ratings Group would like to highlight 3 stocks that pushed the industry lower today:

State Auto Financial ( STFC) is one of the companies that pushed the Insurance industry lower today. State Auto Financial was down $0.38 (1.7%) to $21.14 on light volume. Throughout the day, 21,731 shares of State Auto Financial exchanged hands as compared to its average daily volume of 31,900 shares. The stock ranged in price between $21.10-$21.58 after having opened the day at $21.33 as compared to the previous trading day's close of $21.52.

State Auto Financial Corporation, through its subsidiaries, is engaged in writing personal, business, and specialty insurance products. The company operates through four segments: Personal insurance, Business insurance, Specialty insurance, and Investment operations. State Auto Financial has a market cap of $883.0 million and is part of the financial sector. Shares are up 1.7% year-to-date as of the close of trading on Monday. Currently there are 2 analysts who rate State Auto Financial a buy, no analysts rate it a sell, and 2 rate it a hold.

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TheStreet Ratings rates State Auto Financial as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and poor profit margins.

Highlights from TheStreet Ratings analysis on STFC go as follows:

  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, our view is that this company's fundamentals will not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
  • STATE AUTO FINANCIAL CORP has improved earnings per share by 34.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, STATE AUTO FINANCIAL CORP increased its bottom line by earning $1.49 versus $0.25 in the prior year. This year, the market expects an improvement in earnings ($1.56 versus $1.49).
  • The gross profit margin for STATE AUTO FINANCIAL CORP is currently extremely low, coming in at 11.12%. Regardless of STFC's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, STFC's net profit margin of 9.30% compares favorably to the industry average.
  • Net operating cash flow has significantly decreased to $2.30 million or 71.25% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

You can view the full analysis from the report here: State Auto Financial Ratings Report

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