Breaking Down Cannae Holdings, Inc. (CNNE) Financial Health: Key Insights for Investors

You're looking at Cannae Holdings, Inc. (CNNE) and seeing a complex holding company in the middle of a massive portfolio rebalancing, so let's cut through the noise. The headline from their Q3 2025 earnings is a significant one: a net loss of $70.8 million, translating to an Earnings Per Share (EPS) of -$1.25, which was a defintely a miss against consensus forecasts. Still, that number doesn't tell the whole story, because the strategic pivot is well underway; management has successfully transformed the portfolio from 70% public equities to 80% proprietary private investments and has returned over $500 million to shareholders, including repurchasing 23% of shares outstanding year-to-date. This is a story of a capital allocator selling low-control public stakes, like generating $630 million from the Dun & Bradstreet sale, to fund high-conviction, private assets like Black Knight Football. The near-term risk is the declining operating revenue, which hit $107 million in Q3, but the long-term opportunity is access to unique private market value that public investors typically can't touch. We need to analyze if the new proprietary investments can generate enough net recognized gains to offset the current equity losses.

Revenue Analysis

You're looking for a clear picture of Cannae Holdings, Inc. (CNNE)'s top line, and the reality is that for a holding company, revenue is less about a single stream and more about the performance of its core operating investments. The most recent trailing twelve months (TTM) revenue for Cannae Holdings, Inc. ending June 30, 2025, stood at $437.20 million. This figure reflects the direct operating revenue from its consolidated subsidiaries, not the massive enterprise value of its minority stakes.

The year-over-year trend is a clear headwind. For the trailing twelve months ending in mid-2025, Cannae Holdings, Inc.'s revenue was down 11.07% compared to the prior year. This is a significant drop that signals operational challenges in its core businesses, which you need to watch closely. In fact, the third quarter of 2025 saw total revenue decline by 6.1% year-over-year to $106.90 million. That's a tough environment to navigate, even for an experienced management team.

Primary Operating Revenue Sources

Cannae Holdings, Inc.'s direct operating revenue primarily flows from two segments: its Restaurant Group and its Real Estate and Resort Operations. The Restaurant Group, which includes brands like O'Charley's and 99 Restaurants, is the largest contributor to the top line, but it's also the source of the recent drag on performance.

• Restaurant Group: Sales of $94.60 million in Q3 2025.
• Real Estate & Resort Operations: Contributed $12.30 million in Q3 2025.

Here's the quick math on the Q3 2025 revenue breakdown:

What this segment breakdown hides is the pressure on the Restaurant Group. The decline is defintely tied to inflationary pressures on commodity and labor costs, which are eating into margins despite menu price adjustments. You're seeing a classic squeeze play here: costs are up, and sales volume is struggling to keep pace. This is where you see the need for a clear Mission Statement, Vision, & Core Values of Cannae Holdings, Inc. (CNNE). to guide strategic decisions.

Significant Revenue Stream Changes and Opportunities

The biggest change for Cannae Holdings, Inc. isn't in its operating revenue, but in its strategic portfolio shifts, which impact equity earnings and capital. The company is actively rebalancing its portfolio, a move that will change how it generates value for shareholders.

• Divestiture Proceeds: The sale of its stake in Dun & Bradstreet is expected to generate significant cash proceeds of $630 million. This isn't revenue, but it's a massive capital event that sets up future investment opportunities.
• Strategic Focus: There's a clear shift toward its sports assets, specifically the Black Knight Football Club (BKFC) segment, which posted positive equity earnings in Q3 2025. This signals a potential new long-term value driver outside of traditional services and restaurant operations.
• Equity Losses: The company still holds stakes in other firms, such as a 7.7% stake in Alight, which contributed to equity losses in Q3 2025 due to a decline in the investment's fair market value.

The near-term risk is that the operating segments continue to contract, but the opportunity is in how management deploys that $630 million in fresh capital. That's the real story here: a holding company in transition, swapping a mature data business for cash to fuel new, high-growth, or strategic investments. Your action item is to track the deployment of those proceeds, because that will dictate the next decade of Cannae Holdings, Inc.'s financial trajectory.

Profitability Metrics

You're looking at Cannae Holdings, Inc. (CNNE) to understand if their strategic shift is translating into better profits, and the 2025 numbers show a mixed, but challenging, picture. The short answer is that while the gross margin is holding up, the net profitability is deeply negative, largely due to non-operating factors like investment losses.

For the third quarter of 2025, Cannae Holdings, Inc. reported operating revenue of $107 million, which was down from the prior year, reflecting headwinds in its Restaurant Group, which includes O'Charley's and 99 Restaurants. The company's core profitability metrics-Gross Profit, Operating Profit, and Net Profit-tell a story of a holding company navigating a portfolio rebalancing amid market volatility.

Gross Profit and Operational Efficiency

Cannae Holdings, Inc.'s estimated full-year 2025 Gross Margin is approximately 24.85%. This metric, which measures revenue minus the cost of goods sold (COGS), has shown a slight upward trend from 23.69% in 2024, suggesting some improvement in the core cost structure of its operating businesses. However, the real challenge for Cannae Holdings, Inc. is in the layers below Gross Profit.

Here's the quick math on Q3 operational efficiency: With operating revenue at $107 million and total operating expenses at $120 million, the company posted an operating loss of -$13 million for the quarter, even with a decrease of $12 million in total operating expenses year-over-year. This means their core operations, before accounting for investment gains/losses and interest, are defintely running at a loss. The Trailing Twelve Months (TTM) Operating Margin, as of November 2025, sits at a concerning -45.05%.

• Gross Margin (2025e): 24.85% (Shows core business cost control is improving).
• Operating Margin (Q3 2025): -12.15% (Indicates operating expenses exceed revenue).
• Net Profit Margin (Q3 2025): Negative 108.39% (A significant loss after all expenses).

Net Profitability and Industry Comparison

The Net Profit Margin is the clearest indicator of Cannae Holdings, Inc.'s current financial stress. For Q3 2025, the company reported a substantial net loss of $70.80 million, resulting in a negative Net Profit Margin of 108.39%. This loss was significantly widened by $57 million in equity and losses of unconsolidated affiliates, a key line item for a holding company, which was up from $25 million in the prior year. The full-year 2025 Earnings Per Share (EPS) is expected to be roughly -$3.14.

Comparing these metrics to the broader industry shows the scale of the challenge. For a company with a significant Asset Management component, the sector average for Gross Profit Margin is typically around 78.3%, with an average Net Profit Margin of 22%. Cannae Holdings, Inc.'s margins are clearly lagging, which is to be expected during a major portfolio transition phase, especially one involving the sale of Dun & Bradstreet and a shift toward sports assets like Black Knight Football.

What this estimate hides is the one-off impact of strategic sales and investment write-downs, which heavily skew the net loss. Still, the negative operating margin points to a need for tighter cost management within the existing portfolio companies to make the numbers work before the next big divestiture or acquisition. For a more complete picture of the firm's health, you should review the full analysis at Breaking Down Cannae Holdings, Inc. (CNNE) Financial Health: Key Insights for Investors.

Next step: Dig into the segment-level performance to see which investments are driving the operating losses.

Debt vs. Equity Structure

You're looking at Cannae Holdings, Inc. (CNNE)'s balance sheet, and the first thing you should notice is a clear, deliberate shift toward a remarkably low-leverage model. The company's financing strategy is simple: use equity and asset sales to fund growth and buybacks, keeping debt minimal. It's a conservative approach, especially for a holding company.

The core takeaway is that Cannae Holdings, Inc. (CNNE) is nearly debt-free following its 2025 portfolio rebalancing. This is a huge risk mitigator.

Here's the quick math on their debt position, based on the latest 2025 fiscal year data:

• Debt-to-Equity Ratio: The ratio for the three months ending June 30, 2025, was a very low 0.05.
• Q1 2025 Total Debt: At the end of Q1 2025, the company reported total debt of approximately $149 million.
• Margin Loan Repayment: Following the sale of Dun & Bradstreet (DNB) in Q3 2025, the company used proceeds to repay the full $141 million outstanding under its existing margin loan.

To be fair, this 0.05 debt-to-equity ratio is exceptionally low, especially when you compare it to the average for the Financials sector, which is closer to 98.2% (or 0.982). This tells me Cannae Holdings, Inc. (CNNE) is not relying on debt to finance its acquisitions and operations, which is a massive strength in a high-interest-rate environment. They're using a permanent capital vehicle strategy, funding growth through their own capital and asset monetizations.

What this low-debt estimate hides is the nature of their investments; as a holding company, their financial health is tied to the performance of their portfolio companies, but the corporate balance sheet itself is clean.

Financing Growth: Equity Over Leverage

Cannae Holdings, Inc. (CNNE)'s recent actions defintely show a strong preference for equity funding and capital return over debt financing. The biggest move in 2025 was the strategic divestiture of their Dun & Bradstreet stake, which generated approximately $630 million in cash proceeds. This cash was immediately put to work to reduce debt and reward shareholders, not to take on new leverage.

The capital allocation breakdown from the DNB sale proceeds highlights this balancing act:

The company is actively rebalancing its portfolio away from public company investments and into proprietary, differentiated assets. This shift, coupled with the aggressive capital return-over $500 million returned to shareholders in 2025, representing 35% of shares outstanding at the plan's announcement-demonstrates a strong commitment to enhancing shareholder value without relying on credit markets. The focus is on accretive share buybacks at a discount to Net Asset Value (NAV), which is a smart use of their capital. If you want to dive deeper into the full picture, you can check out the full analysis at Breaking Down Cannae Holdings, Inc. (CNNE) Financial Health: Key Insights for Investors.

Liquidity and Solvency

You want to know if Cannae Holdings, Inc. (CNNE) has the near-term cash to cover its bills, and the answer is a clear yes, but the source of that cash is shifting. The company's liquidity position is strong, primarily due to strategic asset sales and a significant reduction in corporate debt.

Here's the quick math on their short-term health, using the most recent quarter (MRQ) data. A current ratio (current assets divided by current liabilities) above 1.0 is generally good; Cannae Holdings, Inc. is comfortably above that threshold.

• Current Ratio: The ratio stands at a healthy 2.03. This means the company has over two dollars in current assets for every one dollar of short-term debt.
• Quick Ratio (Acid-Test Ratio): This is even more telling, as it excludes less-liquid assets like inventory. The Quick Ratio is 1.93. This indicates the company can cover nearly all its immediate liabilities using only its most liquid assets, like cash and marketable securities. That's defintely a strength.

Working Capital and Strategic Cash Inflows

The working capital trend is defined by a major portfolio rebalancing. Cannae Holdings, Inc. is an investment vehicle, so its working capital (Current Assets minus Current Liabilities) is less about inventory and more about strategic cash management and asset sales. A major liquidity event was the sale of Dun & Bradstreet, which generated approximately $630 million in cash proceeds.

This massive cash inflow was immediately put to work to enhance the balance sheet and return capital. Since the strategic plan was announced, the company has returned over $500 million to shareholders through dividends and share buybacks. The focus has moved from 70% public investments to 20% public investments, redeploying capital into proprietary, cash-flow-positive assets.

What this estimate hides is the nature of their assets; a large portion of their current assets is marketable securities, which can fluctuate in value, but the strategic sales have proven their ability to monetize assets at scale.

Cash Flow Statement Overview (TTM)

Looking at the Trailing Twelve Months (TTM) cash flow statement gives us a clearer picture of where the money is coming from and where it's going. This is where the story gets nuanced.

The negative Cash from Operations (CFO) of -$46.10 million is a near-term concern; it means the operating businesses aren't yet self-funding. But, the huge positive Cash from Investing of $485.00 million is a direct result of the strategic shift, essentially funding the company's activities and capital returns. The margin loan was fully repaid following the D&B sale, and the only remaining corporate debt is a fixed rate term loan with just $47.5 million outstanding.

Liquidity Strengths and Actionable Insight

The immediate liquidity is not a concern. The Current Ratio of 2.03 and Quick Ratio of 1.93 are strong indicators of short-term financial stability. The strength is in the balance sheet, not the income statement. The company has demonstrated a clear ability to liquidate non-core assets to pay down debt and return capital, which is a key part of their strategy. The debt-to-equity ratio is also very low at 0.05.

Your action item is to monitor the new proprietary investments-like the sports and sports-related assets-to see if they can turn that negative operating cash flow into a positive one in the next 12-18 months. If they can't, the company will have to rely on further asset sales or debt for operations, which isn't sustainable long-term. For a deep dive into the valuation of these new holdings, check out the full post: Breaking Down Cannae Holdings, Inc. (CNNE) Financial Health: Key Insights for Investors.

Valuation Analysis

You are looking at Cannae Holdings, Inc. (CNNE) right now, wondering if the stock's recent dip makes it a bargain or a value trap. My analysis is clear: based on traditional metrics and the company's negative earnings, the stock is technically undervalued on a book-value basis but carries significant risk, which is why the market is pricing it near its 52-week low.

The core of the valuation story is that Cannae Holdings, Inc. is an investment holding company, so standard Price-to-Earnings (P/E) and Enterprise Value-to-EBITDA (EV/EBITDA) ratios are distorted by its negative profitability. For the 2025 fiscal year, analysts expect a loss per share of approximately -$3.14, which puts the P/E ratio in negative territory at around -1.96. A negative P/E tells you nothing about being cheap or expensive; it just screams, 'This company isn't profitable right now.'

What really matters for a holding company is its Price-to-Book (P/B) ratio and how the market views its underlying assets. The Trailing Twelve Months (TTM) Price-to-Book ratio is approximately 0.66, meaning the stock is trading at a significant discount to its book value (shareholders' equity). This suggests that for every dollar of net assets on the balance sheet, you are only paying about $0.66 in the stock market. That's a classic sign of being undervalued.

Here's the quick math on the key valuation multiples for Cannae Holdings, Inc. as of late 2025:

What this estimate hides is the market's skepticism about the quality and liquidity of those book-value assets, plus the recent earnings miss. The Enterprise Value-to-EBITDA (EV/EBITDA) is also negative at -10.08, which is common for companies in a rebalancing phase with negative earnings before interest, taxes, depreciation, and amortization (EBITDA). It's a messy picture, but the P/B ratio is your defintely best anchor here.

Stock Performance and Analyst Sentiment

The stock price trend over the last 12 months confirms the market's uncertainty. Cannae Holdings, Inc. has been under pressure, hitting a new 52-week low of $15.12 in November 2025. The stock is down roughly 27.19% over the past year, trading far from its 52-week high of $22.14. This downward trend reflects the Q3 2025 earnings miss and the ongoing portfolio realignment toward sports-related assets, like Black Knight Football.

Despite the negative price action, the company is returning capital to shareholders. The annualized dividend is $0.60 per share, giving you a respectable yield of around 4.0% at the recent low price. The payout ratio, however, is negative (approximately -7.76%), meaning the dividend is not currently covered by earnings; it's funded by capital or asset sales, which is a key risk to monitor.

The analyst community has a mixed, but slightly optimistic, view. The consensus rating is a 'Hold,' but the average price target remains higher than the current price, implying a potential upside. This is a classic case of analysts seeing long-term value that the short-term market is ignoring due to execution risk.

• Average Analyst Target Price: $20.50
• Most Recent Low Target: $19.00 (RBC Capital, Nov 2025)
• Implied Upside (from $15.12 low): Over 35% to the average target.

For more detailed insights, including a full strategic breakdown, make sure to read the complete post: Breaking Down Cannae Holdings, Inc. (CNNE) Financial Health: Key Insights for Investors. Your next step should be to model the liquidation value of the underlying assets to see if that 0.66 P/B multiple is truly justified.

Risk Factors

You need to understand that Cannae Holdings, Inc. (CNNE) is an investment holding company, so its biggest risks aren't just market-wide, but are deeply tied to the performance and volatility of its underlying portfolio companies. The Q3 2025 earnings report defintely highlighted this, with the company reporting a significant loss and a deteriorating earnings trajectory.

The core financial risk is the persistent negative profitability. For Q3 2025, Cannae Holdings, Inc. reported a net loss of $70.8 million, resulting in a negative net margin of 108.39% and a negative Return on Equity (ROE) of over 21.58%. Analysts now expect a full-year 2025 loss per share of roughly -$3.14, which is a sharp miss against prior consensus, reflecting the pressure on the portfolio.

• Negative profitability is the immediate pressure point.

Operational and Strategic Portfolio Risks

Cannae Holdings, Inc.'s stated strategy is to rebalance its portfolio away from public investments and into proprietary, cash-flow-positive private opportunities. This strategic shift, while aiming for 'outsized returns,' introduces two major risks you must track: illiquidity and valuation exposure. The company has successfully reduced its public investments from 70% to just 20% since the strategic plan was announced. But this means a larger portion of its value is now harder to price and sell quickly.

The risk is clear in the Q3 2025 results, where the company saw a massive jump in equity in losses from unconsolidated affiliates-hitting $57 million for the quarter, up from $25 million a year ago. This shows the high volatility and underperformance in some of those key private holdings. Plus, its largest remaining public investment, Alight, reported a 4% year-over-year revenue decline in Q3 2025, forcing management to lower its full-year forecast.

Governance and Shareholder Uncertainty

A major near-term risk is the ongoing push from activist investor Carronade Capital Master, LP, which owns approximately 3.2 million shares. They are criticizing the company's 'chronic underperformance' and poor strategic decisions, and have nominated four directors for the upcoming December 2025 annual meeting. This kind of public dispute creates uncertainty, diverts management focus, and could signal deeper governance issues, even as the company has already made management changes, appointing a new CEO and independent Chairman in May 2025.

Mitigation and Actionable Insights

To be fair, management is not sitting still. Their primary mitigation strategy is a massive capital return program to close the discount between the share price and the Net Asset Value (NAV). They have repurchased $275 million of stock year-to-date in 2025, which represents about 23% of shares outstanding at the start of the year. Plus, they are returning capital via a $0.15 quarterly dividend. They are also planning to sell certain non-core assets to generate up to $55 million in cash tax refunds, which is a smart, tactical move to boost liquidity.

The transition to private assets is the long game, but the activist pressure makes the near-term all about governance and capital allocation. If you want to dive deeper into who is taking a position in this volatile landscape, you should check out Exploring Cannae Holdings, Inc. (CNNE) Investor Profile: Who's Buying and Why?

Growth Opportunities

You need to know where Cannae Holdings, Inc. (CNNE) is going, not just where it has been. The direct takeaway is that Cannae is executing a hard pivot, moving away from public equity investments and doubling down on proprietary, cash-flow-positive private assets, particularly in the sports ecosystem. This is a complete portfolio rebalancing (a permanent capital vehicle strategy) that should unlock long-term value, even if the near-term financials look a little messy.

Here's the quick math on the shift: Cannae has transitioned its portfolio from approximately 70% public investments to just 20% public investments since the strategic plan was announced. That is a massive, deliberate change. The new focus is on assets where they can exert real operational influence, not just sit on a stock certificate. You can read more about the overall financial picture in Breaking Down Cannae Holdings, Inc. (CNNE) Financial Health: Key Insights for Investors.

Strategic Initiatives and Growth Drivers

The company's future is being built on three pillars: selling non-core assets, returning capital, and actively improving the operations of its remaining portfolio companies. The biggest growth driver is the focus on sports and sports-related assets, where management has a 'proven and durable competitive advantage.'

• Sports Investment: Increased investment in Black Knight Football Club (BKFC), which is already showing improved performance and double-digit revenue growth at assets like AFC Bournemouth.
• Private Equity Expansion: Acquired an additional 30% stake in JANA Partners for an upfront payment of $67.5 million, bringing total ownership to 50%. This expands Cannae's access to proprietary investment opportunities.
• Operational Efficiency: Terminating the external management structure is a huge win, cutting management fees from $37.7 million in 2023 to a go-forward run-rate of just $7.6 million.

The divestiture of Dun & Bradstreet, which generated $630 million in proceeds, funded much of this rebalancing and capital return. They are putting their cash to work, defintely. Since the start of the year, Cannae has repurchased $275 million of stock, representing 23% of shares outstanding at the start of 2025.

2025 Projections and Competitive Edge

For the full 2025 fiscal year, management has lowered its guidance, which is a near-term risk but reflects the transition. They project total revenue in the range of $2.25 billion to $2.28 billion and Adjusted EBITDA between $595 million and $620 million. This is the reality of a holding company selling assets and reinvesting. What this estimate hides is the long-term value of the new, higher-influence private portfolio.

Cannae's competitive advantage isn't a product; it's the people and the structure. The leadership, including Vice Chairman William P. Foley II and CEO Ryan R. Caswell, has a proven track record of creating value by acquiring and actively managing operating companies. They are a permanent capital vehicle, meaning they don't face the forced selling deadlines of a traditional private equity fund, allowing them to truly focus on long-term operational improvement.

The next step is simple: Watch the performance of the sports and JANA Partners investments. If the operational improvements continue, the stock's discount to its Net Asset Value (NAV) should continue to narrow, which is the real opportunity here.