The Progressive Corporation (PGR - Free Report) reported earnings per share of 63 cents for October 2021, up 58% year over year. The improvement was driven by an increase in revenues that offset the rise in expenses.
Progressive’s shares have lost 8.2% year to date against the industry’s growth of 17.9%.
October Numbers in Detail
Progressive recorded net premiums written of $4.3 billion, up 15% from $3.8 billion in the year-ago month. Net premiums earned were $4.4 billion, up 14% from about $3.9 billion reported in the year-ago month.
Net realized gain on securities of $302.1 million versus 40.3 million loss incurred in the year-ago month.
Combined ratio — the percentage of premiums paid out as claims and expenses — deteriorated 460 basis points (bps) year over year to 97.2.
Progressive’s operating revenues were $4.6 billion, improving 12.4% year over year, owing to a 12.9% increase in premiums and a 29.8% jump in service revenues. However, 9.7% lower investment income and 2.2% lower fees were partial drags.
Total expenses rose 18.1% to $4.4 billion, primarily on account of 23.2% higher losses and loss adjustment expenses and a 10.3% rise in policy acquisition costs.
In October, policies in force were impressive for both Vehicle and Property businesses. In its Vehicle business, the Personal Auto segment improved 7% year over year to 17.8 million. Special Lines increased 8% from the year-earlier month to 5.3 million policies.
In Progressive’s Personal Auto segment, Agency Auto expanded 5% to 8 million while Direct Auto increased 9% to 9.6 million.
Progressive’s Commercial Auto segment rose 18% year over year to about 1 million. The Property business had 2.8 million policies in force in the reported month, up 13% year over year.
The company’s book value per share was $31.13 as of Oct 30, 2021, up 3.1% from $30.20 on Oct 30, 2020.
Return on equity in the trailing 12 months was 19.9%, down 1460 bps from 34.5% in October 2020. The debt-to-total-capital ratio improved 210 bps year over year to 20.8 as of Oct 30, 2021.
Progressive currently carries a Zacks Rank #4 (Sell).
Stocks to Consider
Some better-ranked stocks from the same space include First American Financial (FAF - Free Report) , Kinsale Capital Group (KNSL - Free Report) and Cincinnati Financial (CINF - Free Report) .
First American sports a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for 2021 and 2022 earnings has moved up 5.5% and 6.3%, respectively, in the past 30 days. First American delivered a four-quarter average earnings surprise of 29.19%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for 2021 and 2022 earnings of Kinsale Capital, sporting a Zacks Rank #1, has moved up 15.2% and 11.7% in the past 30 days. Kinsale Capital delivered a four-quarter average earnings surprise of 37.63%.
Cincinnati Financial carries a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for 2021 and 2022 has moved up 0.9% and 5% in the past 30 days. Cincinnati Financial delivered a four-quarter average earnings surprise of 40.05%.
Shares of First American Financial, Kinsale Capital and Cincinnati Financial have gained 47.5%, 3.5% and 35.9%, respectively year to date.
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The Progressive Corporation (PGR - Free Report) reported earnings per share of 63 cents for October 2021, up 58% year over year. The improvement was driven by an increase in revenues that offset the rise in expenses.
Progressive’s shares have lost 8.2% year to date against the industry’s growth of 17.9%.
October Numbers in Detail
Progressive recorded net premiums written of $4.3 billion, up 15% from $3.8 billion in the year-ago month. Net premiums earned were $4.4 billion, up 14% from about $3.9 billion reported in the year-ago month.
Net realized gain on securities of $302.1 million versus 40.3 million loss incurred in the year-ago month.
Combined ratio — the percentage of premiums paid out as claims and expenses — deteriorated 460 basis points (bps) year over year to 97.2.
Progressive’s operating revenues were $4.6 billion, improving 12.4% year over year, owing to a 12.9% increase in premiums and a 29.8% jump in service revenues. However, 9.7% lower investment income and 2.2% lower fees were partial drags.
Total expenses rose 18.1% to $4.4 billion, primarily on account of 23.2% higher losses and loss adjustment expenses and a 10.3% rise in policy acquisition costs.
In October, policies in force were impressive for both Vehicle and Property businesses. In its Vehicle business, the Personal Auto segment improved 7% year over year to 17.8 million. Special Lines increased 8% from the year-earlier month to 5.3 million policies.
In Progressive’s Personal Auto segment, Agency Auto expanded 5% to 8 million while Direct Auto increased 9% to 9.6 million.
Progressive’s Commercial Auto segment rose 18% year over year to about 1 million. The Property business had 2.8 million policies in force in the reported month, up 13% year over year.
The company’s book value per share was $31.13 as of Oct 30, 2021, up 3.1% from $30.20 on Oct 30, 2020.
Return on equity in the trailing 12 months was 19.9%, down 1460 bps from 34.5% in October 2020. The debt-to-total-capital ratio improved 210 bps year over year to 20.8 as of Oct 30, 2021.
Progressive currently carries a Zacks Rank #4 (Sell).
Stocks to Consider
Some better-ranked stocks from the same space include First American Financial (FAF - Free Report) , Kinsale Capital Group (KNSL - Free Report) and Cincinnati Financial (CINF - Free Report) .
First American sports a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for 2021 and 2022 earnings has moved up 5.5% and 6.3%, respectively, in the past 30 days. First American delivered a four-quarter average earnings surprise of 29.19%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for 2021 and 2022 earnings of Kinsale Capital, sporting a Zacks Rank #1, has moved up 15.2% and 11.7% in the past 30 days. Kinsale Capital delivered a four-quarter average earnings surprise of 37.63%.
Cincinnati Financial carries a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for 2021 and 2022 has moved up 0.9% and 5% in the past 30 days. Cincinnati Financial delivered a four-quarter average earnings surprise of 40.05%.
Shares of First American Financial, Kinsale Capital and Cincinnati Financial have gained 47.5%, 3.5% and 35.9%, respectively year to date.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 5 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How To Profit From Trillions On Spending For Infrastructure >>
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