American Financial Cash Flow From Operations vs. Net Income

AFGE Stock  USD 19.39  0.09  0.46%   
Taking into consideration American Financial's profitability measurements, American Financial's profitability may be sliding down. It has an above-average chance of reporting lower numbers next quarter. Profitability indicators assess American Financial's ability to earn profits and add value for shareholders. At present, American Financial's Days Sales Outstanding is projected to decrease significantly based on the last few years of reporting. The current year's EV To Sales is expected to grow to 1.45, whereas Sales General And Administrative To Revenue is forecasted to decline to 0.06. At present, American Financial's Net Income Per Share is projected to increase based on the last few years of reporting. The current year's Net Income Per E B T is expected to grow to 0.83, whereas Operating Income is forecasted to decline to about 1.1 B.
Current ValueLast YearChange From Last Year 10 Year Trend
Net Profit Margin0.120.1143
Sufficiently Up
Slightly volatile
Operating Profit Margin0.150.1612
Significantly Down
Slightly volatile
Pretax Profit Margin0.140.144
Fairly Down
Slightly volatile
Return On Assets0.02180.0286
Way Down
Slightly volatile
Return On Equity0.210.2001
Sufficiently Up
Slightly volatile
For American Financial profitability analysis, we use financial ratios and fundamental drivers that measure the ability of American Financial to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well American Financial Group utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between American Financial's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of American Financial Group over time as well as its relative position and ranking within its peers.
  
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Is Property & Casualty Insurance space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of American Financial. If investors know American will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about American Financial listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of American Financial is measured differently than its book value, which is the value of American that is recorded on the company's balance sheet. Investors also form their own opinion of American Financial's value that differs from its market value or its book value, called intrinsic value, which is American Financial's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because American Financial's market value can be influenced by many factors that don't directly affect American Financial's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between American Financial's value and its price as these two are different measures arrived at by different means. Investors typically determine if American Financial is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, American Financial's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

American Financial Net Income vs. Cash Flow From Operations Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining American Financial's current stock value. Our valuation model uses many indicators to compare American Financial value to that of its competitors to determine the firm's financial worth.
American Financial Group is rated second in cash flow from operations category among its peers. It is rated third in net income category among its peers making up about  0.43  of Net Income per Cash Flow From Operations. The ratio of Cash Flow From Operations to Net Income for American Financial Group is roughly  2.31 . At present, American Financial's Net Income is projected to increase significantly based on the last few years of reporting. Comparative valuation analysis is a catch-all technique that is used if you cannot value American Financial by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.

American Net Income vs. Cash Flow From Operations

Operating Cash Flow reveals the quality of a company's reported earnings and is calculated by deducting company's income taxes from earnings before interest, taxes, and depreciation (EBITDA). In other words, Operating Cash Flow refers to the amount of cash a firm generates from the sales or products or from rendering services. Operating Cash Flow typically excludes costs associated with long-term investments or investment in marketable securities and is usually used by investors or analysts to check on the quality of a company's earnings.

American Financial

Operating Cash Flow

 = 

EBITDA

-

Taxes

 = 
1.97 B
Operating Cash Flow shows the difference between reported income and actual cash flows of the company. If a firm does not have enough cash or cash equivalents to cover its current liabilities, then both investors and management should be concerned about the company having enough liquid resources to meet current and long term debt obligations.
Net income is the profit of a company for the reporting period, which is derived after taking revenues and gains and subtracting all expenses and losses. Net income is one of the most-watched numbers by money managers as well as individual investors.

American Financial

Net Income

 = 

(Rev + Gain)

-

(Exp + Loss)

 = 
852 M
Because income is reported on the Income Statement of a company and is measured in dollars some investors prefer to use Profit Margin, which measures income as a percentage of sales.

American Net Income Comparison

American Financial is currently under evaluation in net income category among its peers.

American Financial Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in American Financial, profitability is also one of the essential criteria for including it into their portfolios because, without profit, American Financial will eventually generate negative long term returns. The profitability progress is the general direction of American Financial's change in net profit over the period of time. It can combine multiple indicators of American Financial, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income-319 M-303.1 M
Operating Income1.2 B1.1 B
Income Before Tax1.1 B693.5 M
Total Other Income Expense Net-128 M-121.6 M
Net Income852 M894.6 M
Income Tax Expense221 M136.5 M
Net Income From Continuing OpsB726.2 M
Net Income Applicable To Common SharesB872.6 M
Change To Netincome-27.9 M-26.5 M
Net Income Per Share 10.06  10.56 
Income Quality 2.31  2.20 
Net Income Per E B T 0.79  0.83 

American Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on American Financial. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of American Financial position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the American Financial's important profitability drivers and their relationship over time.

Use American Financial in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if American Financial position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in American Financial will appreciate offsetting losses from the drop in the long position's value.

American Financial Pair Trading

American Financial Group Pair Trading Analysis

The ability to find closely correlated positions to American Financial could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace American Financial when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back American Financial - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling American Financial Group to buy it.
The correlation of American Financial is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as American Financial moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if American Financial moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for American Financial can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your American Financial position

In addition to having American Financial in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

Run Wireless Thematic Idea Now

Wireless
Wireless Theme
Companies providing wireless technology and communication services. The Wireless theme has 43 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Wireless Theme or any other thematic opportunities.
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When determining whether American Financial is a strong investment it is important to analyze American Financial's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact American Financial's future performance. For an informed investment choice regarding American Stock, refer to the following important reports:
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You can also try the AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
To fully project American Financial's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of American Financial at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include American Financial's income statement, its balance sheet, and the statement of cash flows.
Potential American Financial investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although American Financial investors may work on each financial statement separately, they are all related. The changes in American Financial's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on American Financial's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.