。
She's afraid of cats.
Literal
She [topic-は] cats [object-を] fears.
こわがる is the verb 'to show fear, be afraid' — the ~がる suffix here turns the i-adjective 怖い ('scary, frightening') into a verb describing observable behaviour. This ~がる is the same suffix that makes ~たい into ~たがる: the underlying logic is that Japanese hesitates to claim direct knowledge of another's interior, so feelings about a third party get described as observable expressions. The を-marking of cats here is correct because こわがる is a true verb taking a direct object, unlike 怖い (which would need が as a stative adjective: 猫が怖い).