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Is a Beat in the Cards for Progressive (PGR) in Q1 Earnings?

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The Progressive Corporation (PGR - Free Report) is slated to report first-quarter 2022 earnings on Apr 14 before the opening bell. The company delivered an earnings surprise of 6.06% in the last reported quarter of 2021.

Factors to Note    

Premiums in the first quarter of 2022 are likely to have benefited from improved rates, solid policies in force and higher retention in its strong performing Vehicle and Property businesses.

The Zacks Consensus Estimate for net premiums earned is pegged at $11.9 billion, suggesting growth of 14.2% from the year-ago reported number.

Policies in force are likely to have improved given the focus on segmentation and prudent risk selection. The Zacks Consensus Estimate for personal lines policies in force stands at 22.6 million, indicating an improvement of 1.8% from the year-ago reported figure.

A higher invested asset base might have aided investment income. The Zacks Consensus Estimate for the metric is pegged at $224 million, indicating an improvement of 1.8% from the year-ago reported number.

Improved premiums, increase in service revenues and fees, and other revenues might have contributed to the improvement in revenues. The Zacks Consensus Estimate for first-quarter revenues stands at $12.2 billion, suggesting year-over-year growth of approximately 13%.

Progressive is a leading auto insurer in the United States and has one of the largest auto insurance groups. It is the largest seller of motorcycle policies, the market leader in commercial auto insurance and one of the top 15 homeowners carriers based on premiums written. Its personal auto business is likely to have benefited from its focus on marketing and competitive product offerings, and strong market presence.

Expenses might have risen on higher loss and loss-adjustment expenses and policy acquisition costs, plus other underwriting expenses. The consensus mark for loss and loss adjustment expenses ratio is pegged at 74, reflecting a deterioration of 600 basis points from the year-ago reported quarter.

The Zacks Consensus Estimate for earnings is pegged at $1.24, indicating a 27.9% decrease from the year-ago quarter.

What the Zacks Model Says

Our proven model predicts an earnings beat for Progressive this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

Earnings ESP: Progressive has an Earnings ESP of +0.03%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
 

Zacks Rank: Progressive currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks to Consider

Here are three other insurance stocks you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat:

W.R. Berkley Corporation (WRB - Free Report) has an Earnings ESP of +3.94% and a Zacks Rank of 3. The Zacks Consensus Estimate for the first-quarter 2022 earnings is pegged at 91 cents, indicating an increase of 26.4% from the year-ago reported figure.

WRB’s earnings beat estimates in each of the four trailing quarters of 2021.

RenaissanceRe Holdings (RNR - Free Report) has an Earnings ESP of +10.23% and a Zacks Rank #3. The Zacks Consensus Estimate for the first-quarter 2022 earnings is pegged at $5.64, way more than 9 cents reported in the year-ago quarter.

RNR beat earnings estimates in two of the four reported quarters of 2021 and missed twice.

The Hanover Insurance Group (THG - Free Report) has an Earnings ESP of +0.72% and a Zacks Rank of 2. The Zacks Consensus Estimate for the first-quarter 2022 earnings stands at $2.76, indicating an improvement of 66.3% from the year-ago reported figure.

THG beat earnings estimates in each of the four reported quarters of 2021.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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