Yahoo Finance CNO Financial (CNO) Raises Dividend, Ups Share Buyback Capacity
With an aim to boost shareholder value, CNO Financial Group, Inc.’s CNO board of directors approved a 7.1% hike in the quarterly dividend. The latest hike makes the present payout 15 cents per share compared with the previous payout of 14 cents.
The increased dividend will be paid out on Jun 23, 2023, to shareholders of record as of Jun 9, 2023. Based on the stock’s May 5 closing price of $21.36, the new dividend will yield 2.6% to the company.
The recent dividend hike also marks CNO Financial’s remarkable move of consecutively raising dividends for slightly more than a decade. Also, its dividend has witnessed an 11-year CAGR of 20.1%. Similarly, another insurer, RLI Corp. RLI approved a 3.8% hike in its quarterly dividend.
CNO Financial also resorts to rewarding shareholders through share buybacks. It had a leftover capacity of roughly $172 million under its share buyback program as of Mar 31, 2023. Simultaneous with the dividend hike announcement, the insurer sanctioned a $500-million increase to its buyback capacity. It has had a securities repurchase program since 2011.
CNO has been quite active on the capital deployment front for the past few years. The company returned $263 million, $402.4 million and $180 million to shareholders in 2020, 2021 and 2022, respectively, via share buybacks. In the same period, CNO Financial paid out dividends worth $67.4 million, $66.1 million and $65 million, respectively.
A strong financial position equips a company to pursue uninterrupted share buybacks and dividend payments. And that is exactly the case with CNO Financial. What remains significantly noticeable is that the insurer did not put a temporary pause on its capital deployment spree for years, which saw the wrath of COVID-19 and its associated volatilities.
A sound cash balance and strong cash-generating abilities substantiate the solid financial position of CNO Financial. It had a total cash balance of $522.1 million as of Mar 31, 2023.
Also, CNO’s return on equity — a profitability measure of how prudently the company is utilizing its shareholders’ funds — stands at 16.2%, higher than the industry’s average of 8.9%.
Shares of CNO Financial have gained 1.3% in a year against the industry’s 9.9% decline. The company currently carries a Zacks Rank #3 (Hold).
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks in the insurance space are Assurant, Inc. AIZ and AXIS Capital Holdings Limited AXS, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The bottom line of Assurant outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 18.18%. The Zacks Consensus Estimate for AIZ’s 2023 earnings indicates a 25% rise, while the same for revenues suggests an improvement of 2.6% from the prior-year actuals. The consensus mark for AIZ’s 2023 earnings has moved 24.4% north in the past seven days.
AXIS Capital’s earnings outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 6.50%. The Zacks Consensus Estimate for AXS’s 2023 earnings indicates a 32.5% rise, while the same for revenues suggests an improvement of 7.7% from the prior-year actuals. The consensus mark for AXS’s 2023 earnings has moved up 2.7% in the past 30 days.
Shares of Assurant and AXIS Capital have lost 27.6% and 4.1%, respectively, in a year.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
RLI Corp. (RLI) : Free Stock Analysis Report
CNO Financial Group, Inc. (CNO) : Free Stock Analysis Report
Assurant, Inc. (AIZ) : Free Stock Analysis Report
Axis Capital Holdings Limited (AXS) : Free Stock Analysis Report
