Should you buy or sell CNA Financial shares after the third quarter results?



On Monday, shares of CNA Financial Corp (NYSE: CNA) jumped 2.74% after releasing its fiscal third quarter results. The company announced its latest quarterly results before the markets opened, beating Street’s consensus estimates for both revenue and profit. CNA’s net premiums increased 5% from the same period a year ago to $ 1.9 billion.

The company posted non-GAAP FQ3 earnings per share of $ 0.87, beating the average analyst estimate of $ 0.68. In addition, its GAAP EPS of $ 0.94 was also $ 0.25 higher than expected, while revenue for the period was $ 2.078 billion, slightly above Street’s forecast of $ 2.061 billion.

CNA Financial seems undervalued

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From an investment perspective, CNA Financial shares are trading at an exciting P / E of 9.83, making them an attractive option for value investors.

On the other hand, analysts expect CNA’s earnings per share to drop more than 30% this year before rebounding 15% next year.

Therefore, long-term growth investors might opt ​​for alternatives in the market. The stock is up 21% this year, slightly underperforming the S&P 500 index, which gained more than 23%.

Source – TradingView

Technically, CNA Financial stocks appear to be trading on an ascending channel formation in the intraday chart. However, the stock has recently retreated to rebound off trendline support, pushing it into overbought conditions.

Still, with stocks yet to test trendline resistance, investors could aim for extended rebound earnings to around $ 47.23 or more at $ 48.25, while $ 44.98 and 43, $ 90 are crucial support areas.

There is still room to run

In summary, although CNA Financial shares appear to have recently rebounded to move closer to overbought conditions, the stock could extend its current gains amid its attractive valuation multiples.

Therefore, it may not be too late to buy stocks.

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