Executive Summary / Key Takeaways

• Loews Corporation, a diversified holding company, is demonstrating robust growth across its core subsidiaries—CNA Financial , Boardwalk Pipelines, and Loews Hotels—driven by strategic investments and operational enhancements.
• CNA Financial is benefiting from improved underwriting results, lower catastrophe losses, and a tailwind from higher net investment income, while actively de-risking its long-term care portfolio.
• Boardwalk Pipelines is expanding its energy infrastructure with significant growth projects totaling $3 billion, poised to increase capacity by 4.20 Bcfd by 2029, supported by substantial future revenue obligations.
• Loews Hotels is undergoing a major expansion in Orlando and recently opened a flagship property in Arlington, Texas, with new hotel openings expected to significantly boost its hospitality footprint and earnings potential over the coming years.
• Despite strong performance and a disciplined capital allocation strategy focused on share repurchases, management believes Loews' shares remain undervalued, presenting a compelling investment opportunity.

A Conglomerate's Calculated Ascent: Diversification and Strategic Growth

Loews Corporation, established in 1969, operates as a diversified holding company with significant interests spanning commercial property and casualty insurance through CNA Financial Corporation , natural gas and natural gas liquids transportation and storage via Boardwalk Pipeline Partners, LP, and a growing portfolio of hotels under Loews Hotels Holding Corporation. This multi-sector approach forms the bedrock of Loews' strategy, aiming to generate stable, long-term value through a blend of mature, cash-generative businesses and high-growth initiatives. This diversification is a foundational strength, allowing the company to mitigate sector-specific risks and capitalize on varied economic cycles.

The company's history is marked by strategic evolution. A pivotal move in 2010 saw CNA's subsidiary, Continental Casualty Company, transfer a substantial portion of its legacy Asbestos Environmental Pollution (AEP) liabilities to National Indemnity Company, significantly de-risking its insurance operations. Concurrently, Boardwalk Pipelines, under leadership changes, embarked on a transformative journey, expanding its midstream presence and stabilizing revenues by focusing on end-users. Since 2018, Loews has accelerated its growth trajectory, with CNA enhancing its underwriting profitability and Loews Hotels committing substantial equity to new developments.

Technological Edge and Operational Innovation Across Segments

Loews Corporation, as a holding company, leverages operational and infrastructure technologies within its subsidiaries to drive efficiency, manage risk, and expand capacity. These are not "product technologies" in the traditional sense but rather sophisticated systems and infrastructure that provide a competitive advantage.

At CNA Financial , technological sophistication is evident in its advanced actuarial analysis and predictive modeling capabilities. These tools are critical for establishing and managing claim and claim adjustment expense reserves, especially for complex, long-tailed liabilities like its run-off long-term care (LTC) business. This analytical prowess has enabled CNA to actively manage its LTC portfolio, reducing active policies by over 40% since 2015 and increasing premium rates by 45%. Furthermore, CNA has strategically lengthened the duration of its LTC investment portfolio to nearly 10 years, up from nine years in 2021, to better match its liability duration, a move facilitated by precise financial modeling and market analysis. These capabilities contribute directly to CNA's improved underlying combined ratio, which has seen a five-point improvement from 95.4% in 2018 to 90.4% in the third quarter of 2023.

Boardwalk Pipelines differentiates itself through its extensive and technologically advanced energy infrastructure. This includes state-of-the-art compression facilities and pipeline systems designed for the efficient and safe transportation and storage of natural gas and natural gas liquids. The ongoing growth projects, such as the Kosciusko Junction Project and the Texas Gateway Project, involve significant technological upgrades and expansions to increase pipeline capacity. For instance, the Kosciusko Junction Project is expected to increase capacity by 1.20 Bcfd through the addition of compression facilities and new pipeline installation. These infrastructure investments provide tangible benefits, enabling Boardwalk to secure long-term, fee-based contracts and capitalize on growing energy demand, particularly from new natural gas-fired power plants driven by the proliferation of data centers.

While Loews Hotels does not detail proprietary "technology" in the same vein, its operational excellence in managing large-scale, high-end properties, including complex joint ventures like those at Universal Orlando Resort, represents a sophisticated operational model. The strategic expansion with new hotels, such as the 888-room Loews Arlington Hotel and the upcoming Universal Stella Nova, Terra Luna, and Grand Helios Resorts, showcases a disciplined approach to hospitality development and management, leveraging market insights and operational best practices to target mid-to-high teens cash-on-cash returns on new projects.

These operational and infrastructure "technologies" are crucial to Loews' competitive moat, contributing to enhanced financial performance through improved margins, lower costs, and expanded market reach across its diverse segments. They underpin the company's ability to execute its growth strategy and maintain its market positioning.

Competitive Landscape: Diversification as a Strategic Bulwark

Loews Corporation's diversified structure provides a unique competitive advantage, allowing it to navigate sector-specific challenges more effectively than many specialized peers. In the commercial property and casualty insurance sector, CNA competes with industry giants like Berkshire Hathaway (BRK.B), Travelers Companies (TRV), and Chubb Limited (CB). While Berkshire Hathaway's vast investment portfolio and financial prowess are formidable, and Travelers and Chubb often exhibit stronger profitability margins and innovation speed in their focused insurance operations, CNA's disciplined underwriting and active management of its long-term care liabilities provide a stable foundation. CNA's underlying combined ratio improvement to 90.4% in Q3 2023 demonstrates its operational effectiveness in a competitive market.

In energy infrastructure, Boardwalk Pipelines stands against major players like Kinder Morgan (KMI). Boardwalk's fee-based revenue model and strategic location near demand centers, including LNG export terminals and new power plants, offer a degree of resilience against commodity price volatility that pure-play energy companies might face. The onerous regulatory environment for new pipeline construction, while a hurdle, also limits new competition, increasing demand for existing, well-positioned infrastructure like Boardwalk's. While Kinder Morgan might boast a more extensive network, Boardwalk's focused growth projects and strong contract base provide a solid competitive footing.

Loews Hotels operates in the highly competitive hospitality sector. Its strategy of developing large, destination-oriented properties, often in partnership with strong brands like Universal Orlando Resort, allows it to capture significant group and leisure business. While direct financial comparisons with all private competitors are challenging to ascertain, the company's focus on high-quality assets and strategic locations positions it to command premium rates and occupancy, even as leisure travel patterns normalize.

Overall, Loews' diversification acts as a strategic bulwark, offering resilience against market fluctuations in any single sector. While it may sometimes lag specialized competitors in segment-specific financial efficiency or innovation speed, its integrated service delivery and ability to leverage strengths across its portfolio enhance its overall market positioning and operational stability.

Financial Performance: A Story of Resilient Growth

Loews Corporation has demonstrated compelling financial performance, reflecting the strength of its diversified operations. For the three months ended September 30, 2025, net income attributable to Loews Corporation rose to $504 million, a significant increase from $401 million in the comparable 2024 period. Similarly, for the nine months ended September 30, 2025, net income reached $1.265 billion, up from $1.227 billion in the prior year.

CNA Financial , the largest segment, was a primary driver of this growth. For the three months ended September 30, 2025, CNA's net income attributable to Loews Corporation increased by 43.2% to $371 million, and for the nine months, it grew by 4.3% to $897 million. This improvement was largely due to enhanced underwriting results in its commercial property and casualty operations, driven by lower catastrophe losses ($41 million in Q3 2025 vs. $143 million in Q3 2024) and higher net investment income. The Commercial segment's combined ratio notably improved by 7.50 points in Q3 2025, reflecting lower catastrophe losses and a better expense ratio. However, the nine-month results for CNA were partially offset by unfavorable net prior year loss reserve development, including impacts from legacy mass tort abuse reserves and social inflation.

Boardwalk Pipelines also delivered strong results, with net income attributable to Loews Corporation increasing by 22.1% to $94 million for the three months ended September 30, 2025, and by 24.6% to $334 million for the nine-month period. This growth was fueled by increased transportation revenues from re-contracting at higher rates and recently completed growth projects, as well as favorable market conditions boosting storage, parking, and lending revenues. Higher ethane pricing and volumes further contributed to product sales revenues.

Loews Hotels Co showed mixed results. While net income improved by $5 million for the three months ended September 30, 2025, primarily due to higher equity income from Universal Orlando Resort joint ventures and the new Loews Arlington Hotel, it decreased by $18 million for the nine-month period, largely due to higher interest expense.

The Corporate segment experienced a decline in net income, primarily due to lower investment income from its trading portfolio.

From a broader perspective, Loews Corporation's latest trailing twelve-month (TTM) financial ratios indicate a healthy operational profile. The company boasts a Gross Profit Margin of 58.21%, an Operating Profit Margin of 11.19%, and a Net Profit Margin of 8.04%. Its EBITDA Margin stands at 12.97%. These figures reflect efficient operations across its diverse businesses. The Current Ratio of 3.19 and a Debt/Equity Ratio of 0.52 underscore a strong balance sheet and sound liquidity management. Free Cash Flow Per Share (TTM) is robust at $15.75.

Liquidity and Capital Allocation: Fueling Growth and Shareholder Returns

Loews Corporation maintains a strong liquidity position, with Parent Company cash and investments, net of receivables and payables, totaling $3.60 billion as of September 30, 2025, an increase from $3.30 billion at December 31, 2024. As a holding company, Loews relies on distributions from its subsidiaries, which have been substantial. During the nine months ended September 30, 2025, Loews received $1.10 billion in cash dividends from its subsidiaries, including $840 million from CNA (with a special cash dividend of $497 million) and $225 million from Boardwalk Pipelines.

A cornerstone of Loews' capital allocation strategy is its consistent commitment to share repurchases. The company repurchased 8 million shares of its common stock for $690 million during the nine months ended September 30, 2025. This strategy has significantly reduced the outstanding share count by approximately one-third since the end of 2017, reflecting management's belief that the shares trade at a discount to their intrinsic value.

CNA Financial maintains sufficient cash flows to meet its working capital and debt obligations, having completed a public offering of $500 million in 5.20% senior notes in August 2025. Boardwalk Pipelines expects to finance its ambitious $3 billion growth projects through a combination of operating cash flows and long-term debt, including its $1 billion revolving credit facility, which was fully available as of September 30, 2025. The company also plans to retire $550 million of 6% debt maturing in June 2026.

Strategic Initiatives and Forward Outlook

Loews Corporation's future growth is firmly anchored in the strategic expansion and operational optimization of its subsidiaries.

Boardwalk Pipelines is at the forefront of this expansion, with an aggregate of $3 billion in growth projects scheduled for completion through 2029, expected to increase pipeline capacity by 4.20 Bcfd. These projects are strategically aligned with the increasing demand for natural gas, driven by the proliferation of data centers and the need for dispatchable electricity generation. Boardwalk anticipates recognizing approximately $19.80 billion in estimated operating revenues from outstanding performance obligations in the future, with $5.70 billion specifically from growth projects. A recent agreement in October 2025 added an anticipated $3.80 billion in revenues to these obligations.

Loews Hotels is significantly expanding its footprint, particularly in Orlando. The Universal Stella Nova Resort and Universal Terra Luna Resort are slated to open in January and February 2025, respectively, followed by the Universal Grand Helios later in 2025. By the end of 2025, Loews Hotels expects to manage and hold a 50% interest in 11 properties in Orlando, totaling 11,000 rooms. The new 888-room Loews Arlington Hotel, which opened in February 2024, has already attracted substantial group business. While new hotels typically take three to four years to achieve fully stabilized results, these developments represent a significant long-term earnings driver.

CNA Financial is expected to benefit from a continued tailwind of higher yields in its fixed income portfolio, which will be accretive to investment income. The company's ongoing focus on disciplined underwriting and active management of its run-off long-term care business, including policyholder buyouts, further strengthens its financial position and reduces long-term risk.

Risks and Challenges

Despite a compelling growth narrative, Loews Corporation faces several inherent risks. Catastrophe losses remain an inherent risk for CNA's property and casualty insurance business, leading to potential fluctuations in results. The estimation of claim and claim adjustment expense reserves is an inherently uncertain process, and ultimate costs could exceed current estimates, particularly for long-tail claims and those impacted by "social inflation." CNA's run-off long-term care business also carries significant estimation risk regarding future policyholder experience, with potential for material increases in reserves if actual experience develops adversely.

Boardwalk Pipelines' growth projects are subject to various risks and uncertainties, including obtaining timely regulatory approvals and permits, construction costs and delays, and the ability to acquire land rights. These factors could materially impact project costs and in-service dates. Furthermore, both Boardwalk Pipelines and Loews Hotels are involved in ongoing litigation, which, while not currently expected to materially affect results, introduces uncertainty. Loews Hotels also faces the challenge of refinancing mortgage loans in a higher interest rate environment, which could impact interest expense, though the company anticipates benefiting from lower spreads as construction loans are replaced with permanent financing.

Conclusion

Loews Corporation presents a compelling investment thesis rooted in its diversified portfolio, strategic growth initiatives, and disciplined capital allocation. The company's core segments—CNA Financial (CNA), Boardwalk Pipelines, and Loews Hotels—are each executing strategies to drive profitability and expansion. CNA is demonstrating robust underwriting performance and benefiting from a favorable interest rate environment, while proactively managing its long-term liabilities. Boardwalk Pipelines is strategically expanding its energy infrastructure to meet growing demand, securing substantial future revenues. Loews Hotels is significantly increasing its room count in key markets, positioning for long-term earnings growth.

Despite these strengths and a consistent commitment to returning capital to shareholders through significant share repurchases, management believes the market continues to undervalue its shares. The company's operational excellence, underpinned by its strategic use of technology and infrastructure, coupled with a strong balance sheet, positions Loews to capitalize on ongoing industry trends and deliver sustained value. Investors should recognize Loews as a resilient conglomerate with a clear roadmap for growth and a strong commitment to shareholder returns, making it a noteworthy consideration for a discerning investment audience.