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On Apr 2, 2013, shares of  Progressive Corp. (PGR - Analyst Report) hit a 52-week high of $25.68. The company generated total of 39 cents in earnings in January and February, with premiums increasing year over year in both the months.

Progressive’s operating earnings and premiums’ growth as well as debt-to-total capital ratio in the first two months of this year reflect overall constant improvement. Policies in force also remained healthy. Progressive remains focused on maintaining a healthy policy life expectancy, which is a significant measure to retain customers.

Progressive delivered positive earnings surprise in two quarters of 2012. However, average surprise was a negative 4.85% due to poor performance in the second quarter. Nevertheless, our proven model shows that the property & casualty insurer is likely to beat earnings in the first quarter of 2013 because it has a right combination of a positive Earnings ESP (Read: Zacks Earnings ESP: A Better Method) and a Zacks Rank #1 (Strong Buy). ESP or Expected Surprise Prediction, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is +4.65%.

Progressive is scheduled to release its first-quarter 2013 earnings results on Apr 10. The Zacks Consensus Estimate for the first quarter is currently pegged at 43 cents, representing a year-over-year increase of 1.3%.

Valuation for Progressive looks stretched. The shares are trading at a considerable premium to the peer group average both on a price-to-book basis and on a forward price-to-earnings basis. Comparatively, return on equity is 29% higher than the peer group average.

Progressive presently carries a Zacks Rank #1 (Strong Buy). Property and casualty insurers like AXIS Capital Holdings Ltd. (AXS - Analyst Report), Montpelier Re Holdings Ltd. (MRH - Analyst Report) and Arch Capital Group Ltd. (ACGL - Snapshot Report), among others, also carry a Zacks Rank #1 and appear impressive.

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