Back to top

Analyst Blog

On Jun 2, 2014, shares of The Allstate Corporation (ALL - Analyst Report) scaled a new 52-week high of $58.88. About 2.4 million shares exchanged hands in the last trading session, closing at $58.67. The momentum was driven by earnings strength, continued focus on enhancement of shareholders’ value and strong scores from rating agencies. The 1-year return from the stock came in at 21.6%, which was ahead of the S&P’s return of 18.03%.

With respect to earnings performance, this Zacks Rank #3 (Hold) property and casualty insurer delivered positive surprise in the last four quarters, with an average beat of 16.09%.

Total debt to capital ratio improved to 21.9% at March end from 22.4% at 2013 end, primarily driven by appreciated equity, which reflects strengthening of balance sheet. Operating return on equity improved to 14.4% from 11.9% in the year-ago quarter.

The company has also been consolidating its business portfolio to enhance its operational results. In April, Allstate divested Lincoln Benefit Life Company to Resolution Life Holdings, Inc. in its efforts to lower exposure to interest rates and spread-based businesses. It also inked a deal to vend Sterling Collision Centers, Inc. to Service King Collision Repair Centers.

With respect to increasing its shareholders value, Allstate increased its quarterly dividend as well as approved a share buyback program. In February, the board incresaed the quarterly dividend by 12% to 28 cents per share.  The annualized dividend of $1.12 yields 1.9%. In addition, the board also approved a new buyback program worth $2.5 billion, the largest one since 2006.

In the last quarter, Allstate bought back about $348 million shares and an additional $750 million shares under an accelerated share repurchase agreement with Barclays plc (BCS - Analyst Report) in Mar 2014. Allstate has $1.65 million available for repurchases under the current authorization.

Steady operational performance by Allstate helped the Zacks Consensus Estimate to move north in the last 30 days. The Zacks Consensus Estimate for 2014 is currently pegged at $5.15 for 2014, after increasing 2.2% as 12 of 17 estimates revised higher. The same for 2015 increased 0.4% as 5 of 17 estimates moved north over the same time frame. The expected long term growth rate for the stock is 9%.

Other Stocks to Consider

Some better-ranked property and casualty insurers worth considering are W.R. Berkley Corp. (WRB - Analyst Report) and AmTrust Financial Services, Inc. (AFSI - Snapshot Report). Both these stocks sport a Zacks Rank #1 (Strong Buy).

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
PLANAR SYST… PLNR 4.44 +5.21%
BITAUTO HOL… BITA 81.71 +5.12%
CTPARTNERS… CTP 16.66 +4.26%
CHINA BIOLO… CBPO 47.91 +3.30%
MALLINCKROD… MNK 72.94 +2.85%