The Progressive Corporation ( PGR Quick Quote PGR - Free Report) reported earnings per share of 15 cents for May 2022 that dropped 73% year over year. The decline was due to higher expenses and net realized loss on securities. May Numbers in Detail
Progressive recorded net premiums written of $3.7 billion, up 9% from $3.4 billion in the year-ago month. Net premiums earned were $3.8 billion, up 11% from $3.4 billion reported in the year-ago month.
Net realized loss on securities was $89 million versus a gain of $146.3 million in the year-ago month. The combined ratio — the percentage of premiums paid out as claims and expenses — deteriorated 340 basis points (bps) year over year to 96.5. Progressive’s operating revenues were $3.9 billion, improving 11.4% year over year, owing to an 11.1% increase in premiums, an 11.8% jump in service revenues, a 33.6% higher investment income, and 4.7% higher fees. Total expenses rose 14.9% to $3.7 billion, primarily on account of 17.9% higher losses and loss adjustment expenses, a 3.7% rise in policy acquisition costs and a 5.2% increase in other underwriting expenses. In May, policies in force were impressive for both Vehicle and Property businesses. In its Vehicle business, the Personal Auto segment declined 2% year over year to 17.2 million. Special Lines increased 5% from the year-earlier month to 5.4 million policies. In Progressive’s Personal Auto segment, Agency Auto declined 4% to 7.7 million while Direct Auto remained flat at 9.5 million. Progressive’s Commercial Auto segment rose 14% year over year to about 1 million. The Property business had 2.8 million policies in force in the reported month, up 7% year over year. Progressive’s book value per share was $27.18 as of May 31, 2022, down 12% from $30.90 on May 30, 2021. Return on equity in the trailing 12 months was -5.8%, having contracted 3750 (basis points) bps from 31.7% in May 2021. The debt-to-total-capital ratio deteriorated 550 bps year over year to 28 as of May 31, 2022. Price Performance
Progressive’s shares have gained 9.7% year to date against the
industry’s decrease of 7.6%. Image Source: Zacks Investment Research Zacks Rank
Progressive currently carries a Zacks Rank #3 (Hold). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Stocks to Consider
Some better-ranked stocks from the property and casualty insurance industry are
W.R. Berkley Corporation ( WRB Quick Quote WRB - Free Report) , HCI Group, Inc. ( HCI Quick Quote HCI - Free Report) and American Financial Group, Inc. ( AFG Quick Quote AFG - Free Report) . While W.R. Berkley sports a Zacks Rank #1 (Strong Buy), HCI Group and American Financial carry a Zacks Rank #2 (Buy). W.R. Berkley’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 27.08%. In the past year, W.R. Berkley's stock has increased 37.6%. The Zacks Consensus Estimate for WRB’s 2022 and 2023 earnings has moved 4.9% and 4.1% north, respectively, in the past 30 days. The Zacks Consensus Estimate for HCI Group’s 2022 and 2023 earnings has moved 33.3% and 40% north, respectively, in the past 60 days. In the past year, HCI Group’s stock has lost 34.6%. The Zacks Consensus Estimate for HCI’s 2022 and 2023 earnings per share indicates a year-over-year increase of 280.9% and 75%, respectively. American Financial’s earnings surpassed estimates in each of the last four quarters, the average beat being 41.72%. In the past year, American Financial has gained 8.1%. The Zacks Consensus Estimate for AFG’s 2022 and 2023 earnings has moved 9.8% and 6.9% north, respectively, in the past 30 days.