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Progressive Corp (PGR) on Growth Track: Time to Invest?
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Shares of The Progressive Corporation (PGR - Free Report) gained 11.30% year to date, significantly outperforming the Zacks categorized Property and Casualty Insurance industry’s increase of 2.16%. Also, the company saw its full-year 2017 estimates moving north by nearly 8.2% over the last 60 days. We expect the stock to retain its momentum on the back of a number of positives.
Progressive Corp. has maintained its industry-leading position in product, service and distribution innovation, particularly personal auto. The company’s net premiums written have been steadily improving over a considerable period of time. We expect Progressive Corp. to continue benefiting from the competitive rates in all its markets and its diversified multi-product offerings. This, in turn, will help the company to experience improved premiums in the future.
This apart, Progressive Corp. remains focused on boosting customer retention. It anticipates a higher Policy Life Expectancy (PLE) – a measure for customer retention – in the near term, on the back of competitive pricing. Also, the company regularly comes up with new offerings to address customer needs, which should drive PLE higher. Its inorganic growth remains impressive with strategic buyouts.
Moreover, the company remains committed toward enhancing shareholder value through dividends and share buybacks. This lowers share count and boosts the bottom line.
Furthermore, valuation seems attractive when compared with the S&P 500. While shares of Progressive Corp. have been trading at 2.88x price to book multiple over a period of one year, the S&P 500 market’s multiple has been 3.54x. However, the stock is trading above the Property and Casualty industry’s multiple of 1.45x. Notably, Progressive Corp. has a trailing 12-month return on equity (ROE) of 12.6%, which is higher than the industry average of 6.7%. Furthermore, the company’s expected long-term earnings growth is pegged at 9.00%.
Investors interested in other stocks from the same space can consider Argo Group International Holdings, Ltd. , Infinity Property and Casualty Corporation and Selective Insurance Group, Inc. (SIGI - Free Report) .
Argo Group International Holdings underwrites specialty insurance and reinsurance products in the P&C market worldwide. The company delivered positive surprises in all of the last four quarters with an average beat of 36.54%. The company sports a Zacks Rank #1.
Infinity Property and Casualty provides personal automobile insurance products in the United States. The company delivered positive surprises in two of the last four quarters with an average beat of 26.16%. The company sports a Zacks Rank #1.
Selective Insurance provides insurance products and services in the United States. The company delivered a positive surprise in one of the last four quarters but with an average negative surprise of 4.53%. The company holds a Zacks Rank #2 (Buy).
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public. Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Click here for Zacks' private trades >>
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Progressive Corp (PGR) on Growth Track: Time to Invest?
Shares of The Progressive Corporation (PGR - Free Report) gained 11.30% year to date, significantly outperforming the Zacks categorized Property and Casualty Insurance industry’s increase of 2.16%. Also, the company saw its full-year 2017 estimates moving north by nearly 8.2% over the last 60 days. We expect the stock to retain its momentum on the back of a number of positives.
Progressive Corp. has maintained its industry-leading position in product, service and distribution innovation, particularly personal auto. The company’s net premiums written have been steadily improving over a considerable period of time. We expect Progressive Corp. to continue benefiting from the competitive rates in all its markets and its diversified multi-product offerings. This, in turn, will help the company to experience improved premiums in the future.
This apart, Progressive Corp. remains focused on boosting customer retention. It anticipates a higher Policy Life Expectancy (PLE) – a measure for customer retention – in the near term, on the back of competitive pricing. Also, the company regularly comes up with new offerings to address customer needs, which should drive PLE higher. Its inorganic growth remains impressive with strategic buyouts.
Moreover, the company remains committed toward enhancing shareholder value through dividends and share buybacks. This lowers share count and boosts the bottom line.
Furthermore, valuation seems attractive when compared with the S&P 500. While shares of Progressive Corp. have been trading at 2.88x price to book multiple over a period of one year, the S&P 500 market’s multiple has been 3.54x. However, the stock is trading above the Property and Casualty industry’s multiple of 1.45x. Notably, Progressive Corp. has a trailing 12-month return on equity (ROE) of 12.6%, which is higher than the industry average of 6.7%. Furthermore, the company’s expected long-term earnings growth is pegged at 9.00%.
Progressive flaunts Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks to Consider
Investors interested in other stocks from the same space can consider Argo Group International Holdings, Ltd. , Infinity Property and Casualty Corporation and Selective Insurance Group, Inc. (SIGI - Free Report) .
Argo Group International Holdings underwrites specialty insurance and reinsurance products in the P&C market worldwide. The company delivered positive surprises in all of the last four quarters with an average beat of 36.54%. The company sports a Zacks Rank #1.
Infinity Property and Casualty provides personal automobile insurance products in the United States. The company delivered positive surprises in two of the last four quarters with an average beat of 26.16%. The company sports a Zacks Rank #1.
Selective Insurance provides insurance products and services in the United States. The company delivered a positive surprise in one of the last four quarters but with an average negative surprise of 4.53%. The company holds a Zacks Rank #2 (Buy).
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public. Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Click here for Zacks' private trades >>