Cincinnati Financial Has Raised Its Dividend for 65 Straight Years. At 10 Times Earnings, Is the Dividend King a Buy?

Cincinnati Financial (NASDAQ: CINF) has done something that few companies have: it has increased its dividend for 65 consecutive years. There are only seven companies ahead of it on the Dividend King list. However, is a long streak of dividend increases enough to make the stock a buy? Here's what you need to know before you jump aboard this Dividend King.

Cincinnati Financial's business is pretty boring

Cincinnati Financial is a property and casualty insurer. From that perspective, there's nothing particularly exciting about the company. It makes money just like other insurance companies, through a mix of premiums and investment income from its float.

However, there's an interesting twist here that you need to understand. Cincinnati Financial tends to be a little more aggressive than its peers with its investment portfolio. The company has far more equity exposure than its peers, which focus primarily on owning bonds. At the end of the first quarter of 2026, the company had $32 billion in total investments, with equities accounting for nearly 40% of the total. Most insurance companies are more affected by interest rates than by stock prices, but Cincinnati Financial's profile is dramatically different, given its outsize equity exposure.

Cincinnati Financial has done very well, but...

Given Cincinnati Financial's status as a Dividend King, its aggressive investment approach has worked well for the company and shareholders. But investors need to tread with a little caution, given the increased importance of equity performance to the company's business model. Right now, the S&P 500 index (SNPINDEX: ^GSPC) is trading near all-time highs, and so is Cincinnati Financial.

To be fair, the stock's roughly 10x price-to-earnings ratio is in line with its five-year average and, notably, slightly below the industry average of just under 12x. It wouldn't be fair to suggest the stock is expensive, but neither does it look particularly cheap. Notably, the 2% dividend yield is near the lowest levels of the past decade.

Look out if there's a bear market

Still, if you are a long-term investor, you should probably keep Cincinnati Financial on your wish list right now. A bear market would likely have a disproportionately negative impact on the stock compared to its peers, where bonds are a greater focus in their investment portfolios. However, if you can be patient, Cincinnati Financial's long-term dividend track record suggests that a bear market could be a good time to take a contrarian stance and buy the stock. When cooler heads prevail and the market eventually recovers, as it has after every bear market so far, Cincinnati Financial is likely to recover along with it.

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.