American Financial Group Announces Special Payout Following Strong Quarterly Close

American Finance US02607T1097

American Financial Group has capped off its 2025 fiscal year with robust fourth-quarter performance, leading to another substantial return of capital to shareholders. The company’s latest earnings report highlighted record underwriting results and the declaration of an additional special dividend.

The property and casualty insurer reported a net income of $299 million for the final quarter of 2025, a notable increase from the $255 million earned in the same period a year earlier. On a per-share basis, this translated to $3.58. The core operating result, a key profitability metric, reached $3.65 per share, surpassing market expectations.

This performance was largely driven by a 41% surge in the company’s underwriting profit, which hit a record $287 million for the quarter. The property and transportation insurance segment was a significant contributor, with strong results in its crop insurance operations.

For the full 2025 year, the company’s net earnings per share stood at $10.08, slightly below the prior year's $10.57. Despite this, American Financial Group achieved a return on equity of 17.8%. The book value per share, inclusive of dividends, saw impressive growth, climbing 22.3% over the year to $57.78.

Commitment to Shareholder Returns

A central feature of the announcement was the board’s approval of a $1.50 per share special dividend. This payment will be distributed on February 25 to shareholders of record as of February 16. This move continues a significant pattern of capital return; since the beginning of 2021, the company has distributed a total of $55.50 per share through special dividends alone.

In aggregate, the company returned $707 million to investors throughout 2025 via a combination of dividend payments and share repurchases. This underscores the strong cash flow generated by its focused portfolio of specialized property and casualty insurance products.

Guidance Points to Continued Growth

Looking ahead, management provided specific targets for the 2026 financial year. The company forecasts its core operating earnings to rise to approximately $11.00 per share. It is also targeting net written premium growth in the range of 3% to 5%.

Furthermore, American Financial Group aims for a combined ratio of 92.5% for the coming year. The firm reiterated that a diversified portfolio remains its central strategy for navigating different phases of the insurance cycle with stability. Its operational focus will stay firmly on specialized commercial niche products.