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Allstate (ALL) Up 14.8% Since Last Earnings Report: Can It Continue?
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A month has gone by since the last earnings report for Allstate (ALL - Free Report) . Shares have added about 14.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Allstate due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Allstate's Q3 Earnings and Revenues Beat Estimates
Allstate Corporation’s third-quarter 2020 earnings of $2.94 per share beat the Zacks Consensus Estimate by 66.1% and also increased 3.5% year over year, led by improved premiums.
Moreover, revenues of $11.1 billion topped the Zacks Consensus Estimate by 2.52% and improved 1.7% year over year as well on higher premiums, partly offset by a weak net investment income.
Total expenses rose 1.5% year over year to $10 billion, mainly due to restructuring charges.
Total policies in force as of Sep 30, 2020 were 172.84 million, up 27.1% year over year.
Net investment income of $832 million dropped 5.5% year over year. The company incurred $990 million of catastrophe losses, up 94.1% year over year.
Solid Segmental Performances
Property-Liability insurance premiums of $9.4 billion inched up 0.9% year over year, driven by premium and policy growth in Allstate Brand Homeowners subsegment. The segment’s underwriting income of $753 million was up 2.2% year over year.
Service Business’ revenues of $498 million were up 19.1% year over year owing to higher contributions from Protection Plans, Dealer Services and Allstate Identity Protection, partly offset by a decline in revenues from Roadside Services and Arity business.
Allstate Life, Benefits and Annuities’ total premium and contract charges were $620 million, down 0.8% year over year owing to lower contributions from Allstate Benefits.
Capital Position (as of Sep 30, 2020)
Total shareholders’ equity was $27.26 billion, up 4.8% from the level as of Dec 31, 2019.
Total assets were $122.75 billion, up 2.3% from the level on Dec 31, 2019.
Adjusted return-on-equity of 17.7% was up 350 basis points year over year.
Share Buyback and Dividend Payment
The company returned $967 million cash to its shareholders through $169 million as dividends and the repurchase of $798 million worth of shares.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates. The consensus estimate has shifted 10.66% due to these changes.
VGM Scores
At this time, Allstate has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Allstate has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Allstate (ALL) Up 14.8% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Allstate (ALL - Free Report) . Shares have added about 14.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Allstate due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Allstate's Q3 Earnings and Revenues Beat Estimates
Allstate Corporation’s third-quarter 2020 earnings of $2.94 per share beat the Zacks Consensus Estimate by 66.1% and also increased 3.5% year over year, led by improved premiums.
Moreover, revenues of $11.1 billion topped the Zacks Consensus Estimate by 2.52% and improved 1.7% year over year as well on higher premiums, partly offset by a weak net investment income.
Total expenses rose 1.5% year over year to $10 billion, mainly due to restructuring charges.
Total policies in force as of Sep 30, 2020 were 172.84 million, up 27.1% year over year.
Net investment income of $832 million dropped 5.5% year over year.
The company incurred $990 million of catastrophe losses, up 94.1% year over year.
Solid Segmental Performances
Property-Liability insurance premiums of $9.4 billion inched up 0.9% year over year, driven by premium and policy growth in Allstate Brand Homeowners subsegment. The segment’s underwriting income of $753 million was up 2.2% year over year.
Service Business’ revenues of $498 million were up 19.1% year over year owing to higher contributions from Protection Plans, Dealer Services and Allstate Identity Protection, partly offset by a decline in revenues from Roadside Services and Arity business.
Allstate Life, Benefits and Annuities’ total premium and contract charges were $620 million, down 0.8% year over year owing to lower contributions from Allstate Benefits.
Capital Position (as of Sep 30, 2020)
Total shareholders’ equity was $27.26 billion, up 4.8% from the level as of Dec 31, 2019.
Total assets were $122.75 billion, up 2.3% from the level on Dec 31, 2019.
Adjusted return-on-equity of 17.7% was up 350 basis points year over year.
Share Buyback and Dividend Payment
The company returned $967 million cash to its shareholders through $169 million as dividends and the repurchase of $798 million worth of shares.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates. The consensus estimate has shifted 10.66% due to these changes.
VGM Scores
At this time, Allstate has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Allstate has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.