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Compelling Reasons to Hold on to Allstate (ALL) Stock Now
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The Allstate Corporation (ALL - Free Report) is benefiting from expanding insurance premiums, a well-performing Protection Services business and acquisitions. A sound financial position is another tailwind for the stock.
Zacks Rank & Price Performance
Allstate carries a Zacks Rank #3 (Hold) at present.
The stock has gained 44.3% in the past year compared with the industry’s 33.2% growth. The Finance sector and the S&P 500 composite index have risen 24.7% and 29.3%, respectively, in the same time frame.
Image Source: Zacks Investment Research
Favorable Style Score
ALL is well-poised for progress, as evidenced by its impressive VGM Score of B. Here V stands for Value, G for Growth and M for Momentum, and the score is a weighted combination of all three factors.
Robust Growth Prospects
The Zacks Consensus Estimate for Allstate’s 2024 earnings is pegged at $12.97 per share, which indicates a nearly 14-fold increase from the 2023 reported figure. The same for revenues is $63.2 billion, implying 10.1% growth from the prior-year number.
The Zacks Consensus Estimate for 2025 earnings is pegged at $16.45 per share, suggesting 26.8% growth from the 2024 estimate. The same for revenues is $67.8 billion, which indicates a rise of 7.3% from the 2024 estimate.
Decent Surprise History
ALL’s earnings outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 43.92%.
Key Business Tailwinds
Allstate’s top line continues to be aided by rate hikes, therefore leading the way to improved property and casualty insurance premiums earned. The metric rose 10.3% year over year in 2023. Management remains optimistic about implementing additional rate hikes in its auto insurance business in 2024. Rate hikes also equip the insurer to navigate higher auto part expenses or labor costs resulting from continued inflationary challenges.
Increased yields from fixed income securities drive the investment results of Allstate. Net investment income grew 3.1% year over year in 2023. Meanwhile, strength in Allstate Protection Plans benefits the performance of the Protection Services Business, revenues of which advanced 9.2% year over year in 2023.
ALL pursues acquisitions in a bid to expand its capabilities and nationwide presence. Such buyouts provide an impetus to Allstate’s top-line growth as well. One such example is the National General acquisition in 2021 that continues to boost ALL’s revenues.
The insurer also resorts to divestitures in a bid to extract capital out of underperforming businesses, such as its life and annuity businesses that it sold in 2021, and allocate resources in growing share in personal property-liability market. Management is eyeing the divestiture of Allstate’s Health and Benefits businesses, which is likely to be completed in 2024.
Allstate’s efforts to emerge as a cost-effective digital insurer require special mention, keeping in mind the ongoing digitization infused across every sphere of life. The decrease in operational costs enables it to divert funds for growth and tech-related investments.
The financial strength of ALL is backed by a sound cash balance and sufficient cash-generating abilities, which in turn, empowers it to sustain its active capital deployment record to shareholders through share buybacks and dividend hikes. In 2023, it repurchased shares worth $330 million. In February 2024, management approved a 3.4% hike in the quarterly dividend. Its dividend yield of 2.3% compares favorably with the industry’s figure of 0.3%.
Stocks to Consider
Some better-ranked stocks in the insurance space are Skyward Specialty Insurance Group, Inc. (SKWD - Free Report) , Corebridge Financial, Inc. (CRBG - Free Report) and W. R. Berkley Corporation (WRB - Free Report) . Skyward Specialty sports a Zacks Rank #1 (Strong Buy), and Corebridge and W.R. Berkley carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Skyward Specialty’s earnings surpassed estimates in each of the last four quarters, the average surprise being 32.04%. The Zacks Consensus Estimate for SKWD’s 2024 earnings indicates a 24.6% rise, while the consensus mark for revenues suggests an improvement of 20.4% from the respective prior-year tallies. The consensus mark for SKWD’s 2024 earnings has moved 8.2% north in the past 30 days.
The bottom line of Corebridge outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 6.98%. The Zacks Consensus Estimate for CRBG’s 2024 earnings indicates a 21.5% rise, while the consensus mark for revenues suggests an improvement of 25.3% from the respective prior-year tallies. The consensus mark for CRBG’s 2024 earnings has moved 1% north in the past 60 days.
W.R. Berkley’s earnings outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 4.10%. The Zacks Consensus Estimate for WRB’s 2024 earnings indicates a 22% rise, while the consensus mark for revenues suggests an improvement of 9.7% from the respective prior-year tallies. The consensus mark for WRB’s 2024 earnings has moved up 3.8% in the past 60 days.
Shares of Skyward Specialty, Corebridge and W.R. Berkley have gained 87%, 59.6% and 38.4%, respectively, in the past year.
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Compelling Reasons to Hold on to Allstate (ALL) Stock Now
The Allstate Corporation (ALL - Free Report) is benefiting from expanding insurance premiums, a well-performing Protection Services business and acquisitions. A sound financial position is another tailwind for the stock.
Zacks Rank & Price Performance
Allstate carries a Zacks Rank #3 (Hold) at present.
The stock has gained 44.3% in the past year compared with the industry’s 33.2% growth. The Finance sector and the S&P 500 composite index have risen 24.7% and 29.3%, respectively, in the same time frame.
Image Source: Zacks Investment Research
Favorable Style Score
ALL is well-poised for progress, as evidenced by its impressive VGM Score of B. Here V stands for Value, G for Growth and M for Momentum, and the score is a weighted combination of all three factors.
Robust Growth Prospects
The Zacks Consensus Estimate for Allstate’s 2024 earnings is pegged at $12.97 per share, which indicates a nearly 14-fold increase from the 2023 reported figure. The same for revenues is $63.2 billion, implying 10.1% growth from the prior-year number.
The Zacks Consensus Estimate for 2025 earnings is pegged at $16.45 per share, suggesting 26.8% growth from the 2024 estimate. The same for revenues is $67.8 billion, which indicates a rise of 7.3% from the 2024 estimate.
Decent Surprise History
ALL’s earnings outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 43.92%.
Key Business Tailwinds
Allstate’s top line continues to be aided by rate hikes, therefore leading the way to improved property and casualty insurance premiums earned. The metric rose 10.3% year over year in 2023. Management remains optimistic about implementing additional rate hikes in its auto insurance business in 2024. Rate hikes also equip the insurer to navigate higher auto part expenses or labor costs resulting from continued inflationary challenges.
Increased yields from fixed income securities drive the investment results of Allstate. Net investment income grew 3.1% year over year in 2023. Meanwhile, strength in Allstate Protection Plans benefits the performance of the Protection Services Business, revenues of which advanced 9.2% year over year in 2023.
ALL pursues acquisitions in a bid to expand its capabilities and nationwide presence. Such buyouts provide an impetus to Allstate’s top-line growth as well. One such example is the National General acquisition in 2021 that continues to boost ALL’s revenues.
The insurer also resorts to divestitures in a bid to extract capital out of underperforming businesses, such as its life and annuity businesses that it sold in 2021, and allocate resources in growing share in personal property-liability market. Management is eyeing the divestiture of Allstate’s Health and Benefits businesses, which is likely to be completed in 2024.
Allstate’s efforts to emerge as a cost-effective digital insurer require special mention, keeping in mind the ongoing digitization infused across every sphere of life. The decrease in operational costs enables it to divert funds for growth and tech-related investments.
The financial strength of ALL is backed by a sound cash balance and sufficient cash-generating abilities, which in turn, empowers it to sustain its active capital deployment record to shareholders through share buybacks and dividend hikes. In 2023, it repurchased shares worth $330 million. In February 2024, management approved a 3.4% hike in the quarterly dividend. Its dividend yield of 2.3% compares favorably with the industry’s figure of 0.3%.
Stocks to Consider
Some better-ranked stocks in the insurance space are Skyward Specialty Insurance Group, Inc. (SKWD - Free Report) , Corebridge Financial, Inc. (CRBG - Free Report) and W. R. Berkley Corporation (WRB - Free Report) . Skyward Specialty sports a Zacks Rank #1 (Strong Buy), and Corebridge and W.R. Berkley carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Skyward Specialty’s earnings surpassed estimates in each of the last four quarters, the average surprise being 32.04%. The Zacks Consensus Estimate for SKWD’s 2024 earnings indicates a 24.6% rise, while the consensus mark for revenues suggests an improvement of 20.4% from the respective prior-year tallies. The consensus mark for SKWD’s 2024 earnings has moved 8.2% north in the past 30 days.
The bottom line of Corebridge outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 6.98%. The Zacks Consensus Estimate for CRBG’s 2024 earnings indicates a 21.5% rise, while the consensus mark for revenues suggests an improvement of 25.3% from the respective prior-year tallies. The consensus mark for CRBG’s 2024 earnings has moved 1% north in the past 60 days.
W.R. Berkley’s earnings outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 4.10%. The Zacks Consensus Estimate for WRB’s 2024 earnings indicates a 22% rise, while the consensus mark for revenues suggests an improvement of 9.7% from the respective prior-year tallies. The consensus mark for WRB’s 2024 earnings has moved up 3.8% in the past 60 days.
Shares of Skyward Specialty, Corebridge and W.R. Berkley have gained 87%, 59.6% and 38.4%, respectively, in the past year.