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Is a Beat in Store for Progressive (PGR) in Q3 Earnings?
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The Progressive Corporation (PGR - Free Report) is slated to report third-quarter 2023 earnings on Oct 13, before the opening bell. The company’s earnings missed estimates in the last reported quarter.
Factors to Note
A compelling product portfolio, the company’s leadership position, strength in the Vehicle and Property businesses, healthy policies in force and solid retention are likely to have favored net premiums earned. The Zacks Consensus Estimate for net premiums earned is pegged at $14.8 billion, suggesting growth of 19.1% from the year-ago reported number. We estimate net premiums earned of $13.6 billion for the to-be-reported quarter.
Focus on segmentation and prudent risk selection are likely to have aided policies in force. The Zacks Consensus Estimate for personal lines policies in force stands at 24.9 million, indicating an improvement of 8.2% from the year-ago reported figure. We estimate policies in force of 28.7 million in the to-be-reported quarter.
Focus on marketing and competitive product offerings and a strong market presence are likely to have aided the personal auto business.
A higher invested asset base and a higher interest rate are likely to have aided net investment income. The Zacks Consensus Estimate for the metric is pegged at $493 million, indicating an increase of 47.6% from the year-ago reported quarter. We estimate net investment income of $493.3 million in the to-be-reported quarter.
The top line is likely to have benefited from higher premiums earned, higher net investment income, and an increase in service revenues and fees and other revenues. The Zacks Consensus Estimate for third-quarter revenues stands at $15.5 billion, suggesting year-over-year growth of approximately 19%. We estimate quarterly revenues to be $14.4 billion.
Expenses are likely to have risen on higher loss and loss-adjustment expenses, policy acquisition costs and other underwriting expenses. We estimate total operating expenses to increase 8.1% to $13.7 billion. The consensus mark for loss and loss-adjustment expense ratio is pegged at 79.
The Zacks Consensus Estimate for earnings is pegged at $1.62, indicating a 230.6% surge from the year-ago quarter reported figure. We estimate the bottom line to increase 89.7% to 93 cents.
What the Zacks Model Says
Our proven model predicts an earnings beat for Progressive this time. This is because the stock has the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).
Earnings ESP: Progressive has an Earnings ESP of +5.08%. This is because the Most Accurate Estimate of $1.71 is pegged higher than the Zacks Consensus Estimate of $1.62. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
The Progressive Corporation Price and EPS Surprise
Here are three P&C insurance stocks you may want to consider, as our model shows that these also have the right combination of elements to post an earnings beat:
Arch Capital Group (ACGL - Free Report) has an Earnings ESP of +3.35% and a Zacks Rank of 2. The Zacks Consensus Estimate for third-quarter 2023 earnings is pegged at $1.44, indicating an increase of 414.3% from the year-ago reported figure.
ACGL’s earnings beat estimates in the last four reported quarters.
Chubb Limited (CB - Free Report) has an Earnings ESP of +4.95% and a Zacks Rank #2. The Zacks Consensus Estimate for third-quarter 2023 earnings is pegged at $4.20, indicating an increase of 32.5%.
CB’s earnings beat estimates in three of the last four reported quarters and missed in one.
The Travelers Companies (TRV - Free Report) has an Earnings ESP of +3.04% and a Zacks Rank of 2. The Zacks Consensus Estimate for third-quarter 2023 earnings stands at $2.93, implying an increase of 33.2% from the year-ago reported quarter.
TRV’s earnings beat estimates in the last four reported quarters.
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Is a Beat in Store for Progressive (PGR) in Q3 Earnings?
The Progressive Corporation (PGR - Free Report) is slated to report third-quarter 2023 earnings on Oct 13, before the opening bell. The company’s earnings missed estimates in the last reported quarter.
Factors to Note
A compelling product portfolio, the company’s leadership position, strength in the Vehicle and Property businesses, healthy policies in force and solid retention are likely to have favored net premiums earned. The Zacks Consensus Estimate for net premiums earned is pegged at $14.8 billion, suggesting growth of 19.1% from the year-ago reported number. We estimate net premiums earned of $13.6 billion for the to-be-reported quarter.
Focus on segmentation and prudent risk selection are likely to have aided policies in force. The Zacks Consensus Estimate for personal lines policies in force stands at 24.9 million, indicating an improvement of 8.2% from the year-ago reported figure. We estimate policies in force of 28.7 million in the to-be-reported quarter.
Focus on marketing and competitive product offerings and a strong market presence are likely to have aided the personal auto business.
A higher invested asset base and a higher interest rate are likely to have aided net investment income. The Zacks Consensus Estimate for the metric is pegged at $493 million, indicating an increase of 47.6% from the year-ago reported quarter. We estimate net investment income of $493.3 million in the to-be-reported quarter.
The top line is likely to have benefited from higher premiums earned, higher net investment income, and an increase in service revenues and fees and other revenues. The Zacks Consensus Estimate for third-quarter revenues stands at $15.5 billion, suggesting year-over-year growth of approximately 19%. We estimate quarterly revenues to be $14.4 billion.
Expenses are likely to have risen on higher loss and loss-adjustment expenses, policy acquisition costs and other underwriting expenses. We estimate total operating expenses to increase 8.1% to $13.7 billion. The consensus mark for loss and loss-adjustment expense ratio is pegged at 79.
The Zacks Consensus Estimate for earnings is pegged at $1.62, indicating a 230.6% surge from the year-ago quarter reported figure. We estimate the bottom line to increase 89.7% to 93 cents.
What the Zacks Model Says
Our proven model predicts an earnings beat for Progressive this time. This is because the stock has the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).
Earnings ESP: Progressive has an Earnings ESP of +5.08%. This is because the Most Accurate Estimate of $1.71 is pegged higher than the Zacks Consensus Estimate of $1.62. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
The Progressive Corporation Price and EPS Surprise
The Progressive Corporation price-eps-surprise | The Progressive Corporation Quote
Zacks Rank: PGR 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 P&C insurance stocks you may want to consider, as our model shows that these also have the right combination of elements to post an earnings beat:
Arch Capital Group (ACGL - Free Report) has an Earnings ESP of +3.35% and a Zacks Rank of 2. The Zacks Consensus Estimate for third-quarter 2023 earnings is pegged at $1.44, indicating an increase of 414.3% from the year-ago reported figure.
ACGL’s earnings beat estimates in the last four reported quarters.
Chubb Limited (CB - Free Report) has an Earnings ESP of +4.95% and a Zacks Rank #2. The Zacks Consensus Estimate for third-quarter 2023 earnings is pegged at $4.20, indicating an increase of 32.5%.
CB’s earnings beat estimates in three of the last four reported quarters and missed in one.
The Travelers Companies (TRV - Free Report) has an Earnings ESP of +3.04% and a Zacks Rank of 2. The Zacks Consensus Estimate for third-quarter 2023 earnings stands at $2.93, implying an increase of 33.2% from the year-ago reported quarter.
TRV’s earnings beat estimates in the last four reported quarters.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.