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Progressive's October Earnings Rise: Here's How to Play the Stock
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Key Takeaways
PGR posted higher October EPS, revenues and stronger premiums with an improved combined ratio.
Personal Auto led growth as policies in force rose across Direct, Agency, Special Lines and Commercial Auto.
Progressive advanced retention, bundling strategy and tech-driven underwriting to support sustained expansion.
The Progressive Corporation (PGR - Free Report) reported strong October 2025 results, wherein both top and bottom lines improved yea rover year. Net premiums written increased 6%, driven by the strong performance of operating businesses. Combined ratio — the percentage of premiums paid out as claims and expenses — improved 440 basis points (bps) from the prior-year quarter’s level to 89.7.
PGR is one of the country’s largest auto insurance groups, the largest seller of motorcycle and boat policies, the market leader in commercial auto insurance and one of the top 15 homeowners carriers based on premiums written. A solid market presence, a convincing portfolio of products and services, and underwriting and operational expertise should help this insurer deliver steady profitability.
A Sneak Peek Into October Results
October earnings per share of $1.44 increased 107% year over year. Operating revenues of $7.5 billion improved 11.1% year over year. Net premiums earned increased 11%.
Policies in force were solid in the Personal Auto segment, up 12% year over year to 37.2 million. Special Lines improved 8% to 6.5 million. In the Personal Auto segment, Direct Auto increased 16% year over year to 15.8 million, while Agency Auto increased 12% to 10.7 million.
Progressive’s Commercial Auto segment rose 5% year over year to 1.5 million. The Property business had 3.7 million policies in force, up 5%. Total expenses increased 5.6% year over year to $6.5 billion, attributable to a 2.9% higher loss and loss adjustment expenses, a 9.4% increase in policy acquisition costs and a 9.4% jump in other underwriting expenses.
Growth Story Remains Impressive
Progressive continues to benefit from a robust product portfolio and a disciplined underwriting culture that together support strong policy retention and steady premium expansion. Its focus on maintaining healthy policies in force and sustaining a solid retention ratio directly contributes to premium growth. Policy life expectancy (PLE) — a key measure of customer loyalty — has increased consistently across all business lines in recent years. This improvement reflects Progressive’s ability to differentiate through unique auto insurance options, superior customer service and competitive pricing, all of which contribute to deeper and longer-lasting customer relationships.
A central pillar of Progressive’s growth strategy is its push toward bundled offerings, particularly auto and home bundles, which deepen customer engagement and improve retention economics. The company is also taking a cautious approach to property exposure, reducing risks in areas prone to elevated losses, while simultaneously expanding segmentation through targeted product rollouts. These initiatives, along with efforts to increase mobile app adoption and expand product availability across more states, are strengthening Progressive’s distribution reach and positioning it for sustained market share gains.
Progressive’s leadership in Personal Auto remains a major driver of long-term growth. The segment continues to perform strongly, aided by recent rate increases, a surge in new personal auto applications, and increased advertising investments that have enhanced brand visibility. Beyond pricing actions, Progressive has implemented non-rate initiatives to accelerate growth, while its extensive network of independent agents remains an essential channel for customer acquisition and retention. Together, these factors reinforce the momentum of the Personal Auto segment and support both premium volume expansion and margin improvement.
Technology remains at the core of Progressive’s competitive edge. The company’s substantial investment in digital transformation, data analytics and AI enhances operational efficiency, strengthens underwriting accuracy and supports more responsive customer service. These technology-led advantages contribute to more refined pricing strategies, faster claims processing and an improved customer experience — key differentiators in a highly competitive insurance landscape.
Supported by strong operating cash flows, Progressive continues to invest in initiatives that elevate margins and drive sustainable growth. The insurer has been steadily enhancing book value and working to reduce leverage, even though its leverage ratio remains above industry averages. Importantly, Progressive’s strong times-interest-earned metric highlights its solid ability to service debt and maintain financial flexibility.
Growth Projections
The Zacks Consensus Estimate for Progressive’s 2025 earnings is pegged at $17.90 per share, indicating an increase of 27.4% from the year-ago reported figure on 15.6% higher revenues of $86.8 billion. The consensus estimate for 2026 earnings is pegged at $16.86 per share, indicating a year-over-year decrease of 5.8% on 8.2% higher revenues of $93.3 billion.
The long-term earnings growth rate is currently pegged at 13.5%, better than the industry average of 7.8%. It has a Growth Score of A.
Price Performance
Shares of Progressive have lost 5.7% year to date, underperforming the industry’s growth of 10.1%, the Finance sector’s return of 11.2% and the Zacks S&P 500 composite’s appreciation of 14.2%.
PGR vs. Industry, Sector, S&P 500
Image Source: Zacks Investment Research
Shares of Allstate Corporation (ALL - Free Report) and Travelers Companies (TRV - Free Report) , two other auto insurers, have gained 9.8% and 19.5%, respectively, in the said time frame.
Travelers holds a leading position in the U.S. auto, homeowners, and commercial property-casualty insurance markets. The company is well-positioned for long-term growth, driven by high customer retention, strategic pricing improvements, rising new business volumes, and positive momentum in renewal premiums.
Allstate is refining its strategy by focusing on its core strengths and exiting underperforming segments. The company projects growth in total Property-Liability policies in force this year, supported by higher auto insurance renewal rates and steady increases in new business. Backed by rising premium income, a growing protection services division, and continued operational streamlining, Allstate is well-positioned to achieve sustained long-term growth.
Average Target Price for PGR Suggests Solid Upside
Based on short-term price targets offered by 20 analysts, the Zacks average price target is $266.72 per share. The average suggests a potential 19.6% upside from the last closing price.
PGR’s Estimate Revision Trend
Earnings estimates for Progressive for 2025 and 2026 have moved up 0.3% and 1.2% over the past seven days.
Image Source: Zacks Investment Research
Earnings estimates for Allstate and Travelers for 2025 and 2026 have moved north over the past seven days.
PGR’s Expensive Valuation
PGR is currently expensive. It is trading at a P/B multiple of 3.74, higher than the industry average of 1.49. Given its market-leading presence, growth prospects, rising estimates and better return on invested capital, a premium valuation is justified.
Image Source: Zacks Investment Research
On the contrary, both Allstate and Travelers shares are cheaper than PGR.
To Conclude
Progressive remains committed to enhancing customers’ experience through improved services that, in turn, help it grow policies in force through better retention and the addition of new customers. Progressive’s leadership position, better pricing and prudent underwriting standards should drive PGR.
Progressive has an impressive history of paying dividends uninterruptedly since 1971. Its northbound estimate revisions, decent earnings surprise history and its VGM Score of B instill confidence in the stock.
Given its premium valuation, price erosion and expected decline in 2026 bottom line, it is better to hold onto this Zacks Rank #3 (Hold) stock presently.
Image: Shutterstock
Progressive's October Earnings Rise: Here's How to Play the Stock
Key Takeaways
The Progressive Corporation (PGR - Free Report) reported strong October 2025 results, wherein both top and bottom lines improved yea rover year. Net premiums written increased 6%, driven by the strong performance of operating businesses. Combined ratio — the percentage of premiums paid out as claims and expenses — improved 440 basis points (bps) from the prior-year quarter’s level to 89.7.
PGR is one of the country’s largest auto insurance groups, the largest seller of motorcycle and boat policies, the market leader in commercial auto insurance and one of the top 15 homeowners carriers based on premiums written. A solid market presence, a convincing portfolio of products and services, and underwriting and operational expertise should help this insurer deliver steady profitability.
A Sneak Peek Into October Results
October earnings per share of $1.44 increased 107% year over year. Operating revenues of $7.5 billion improved 11.1% year over year. Net premiums earned increased 11%.
Policies in force were solid in the Personal Auto segment, up 12% year over year to 37.2 million. Special Lines improved 8% to 6.5 million. In the Personal Auto segment, Direct Auto increased 16% year over year to 15.8 million, while Agency Auto increased 12% to 10.7 million.
Progressive’s Commercial Auto segment rose 5% year over year to 1.5 million. The Property business had 3.7 million policies in force, up 5%.
Total expenses increased 5.6% year over year to $6.5 billion, attributable to a 2.9% higher loss and loss adjustment expenses, a 9.4% increase in policy acquisition costs and a 9.4% jump in other underwriting expenses.
Growth Story Remains Impressive
Progressive continues to benefit from a robust product portfolio and a disciplined underwriting culture that together support strong policy retention and steady premium expansion. Its focus on maintaining healthy policies in force and sustaining a solid retention ratio directly contributes to premium growth. Policy life expectancy (PLE) — a key measure of customer loyalty — has increased consistently across all business lines in recent years. This improvement reflects Progressive’s ability to differentiate through unique auto insurance options, superior customer service and competitive pricing, all of which contribute to deeper and longer-lasting customer relationships.
A central pillar of Progressive’s growth strategy is its push toward bundled offerings, particularly auto and home bundles, which deepen customer engagement and improve retention economics. The company is also taking a cautious approach to property exposure, reducing risks in areas prone to elevated losses, while simultaneously expanding segmentation through targeted product rollouts. These initiatives, along with efforts to increase mobile app adoption and expand product availability across more states, are strengthening Progressive’s distribution reach and positioning it for sustained market share gains.
Progressive’s leadership in Personal Auto remains a major driver of long-term growth. The segment continues to perform strongly, aided by recent rate increases, a surge in new personal auto applications, and increased advertising investments that have enhanced brand visibility. Beyond pricing actions, Progressive has implemented non-rate initiatives to accelerate growth, while its extensive network of independent agents remains an essential channel for customer acquisition and retention. Together, these factors reinforce the momentum of the Personal Auto segment and support both premium volume expansion and margin improvement.
Technology remains at the core of Progressive’s competitive edge. The company’s substantial investment in digital transformation, data analytics and AI enhances operational efficiency, strengthens underwriting accuracy and supports more responsive customer service. These technology-led advantages contribute to more refined pricing strategies, faster claims processing and an improved customer experience — key differentiators in a highly competitive insurance landscape.
Supported by strong operating cash flows, Progressive continues to invest in initiatives that elevate margins and drive sustainable growth. The insurer has been steadily enhancing book value and working to reduce leverage, even though its leverage ratio remains above industry averages. Importantly, Progressive’s strong times-interest-earned metric highlights its solid ability to service debt and maintain financial flexibility.
Growth Projections
The Zacks Consensus Estimate for Progressive’s 2025 earnings is pegged at $17.90 per share, indicating an increase of 27.4% from the year-ago reported figure on 15.6% higher revenues of $86.8 billion. The consensus estimate for 2026 earnings is pegged at $16.86 per share, indicating a year-over-year decrease of 5.8% on 8.2% higher revenues of $93.3 billion.
The long-term earnings growth rate is currently pegged at 13.5%, better than the industry average of 7.8%. It has a Growth Score of A.
Price Performance
Shares of Progressive have lost 5.7% year to date, underperforming the industry’s growth of 10.1%, the Finance sector’s return of 11.2% and the Zacks S&P 500 composite’s appreciation of 14.2%.
PGR vs. Industry, Sector, S&P 500
Image Source: Zacks Investment Research
Shares of Allstate Corporation (ALL - Free Report) and Travelers Companies (TRV - Free Report) , two other auto insurers, have gained 9.8% and 19.5%, respectively, in the said time frame.
Travelers holds a leading position in the U.S. auto, homeowners, and commercial property-casualty insurance markets. The company is well-positioned for long-term growth, driven by high customer retention, strategic pricing improvements, rising new business volumes, and positive momentum in renewal premiums.
Allstate is refining its strategy by focusing on its core strengths and exiting underperforming segments. The company projects growth in total Property-Liability policies in force this year, supported by higher auto insurance renewal rates and steady increases in new business. Backed by rising premium income, a growing protection services division, and continued operational streamlining, Allstate is well-positioned to achieve sustained long-term growth.
Average Target Price for PGR Suggests Solid Upside
Based on short-term price targets offered by 20 analysts, the Zacks average price target is $266.72 per share. The average suggests a potential 19.6% upside from the last closing price.
PGR’s Estimate Revision Trend
Earnings estimates for Progressive for 2025 and 2026 have moved up 0.3% and 1.2% over the past seven days.
Image Source: Zacks Investment Research
Earnings estimates for Allstate and Travelers for 2025 and 2026 have moved north over the past seven days.
PGR’s Expensive Valuation
PGR is currently expensive. It is trading at a P/B multiple of 3.74, higher than the industry average of 1.49. Given its market-leading presence, growth prospects, rising estimates and better return on invested capital, a premium valuation is justified.
Image Source: Zacks Investment Research
On the contrary, both Allstate and Travelers shares are cheaper than PGR.
To Conclude
Progressive remains committed to enhancing customers’ experience through improved services that, in turn, help it grow policies in force through better retention and the addition of new customers. Progressive’s leadership position, better pricing and prudent underwriting standards should drive PGR.
Progressive has an impressive history of paying dividends uninterruptedly since 1971. Its northbound estimate revisions, decent earnings surprise history and its VGM Score of B instill confidence in the stock.
Given its premium valuation, price erosion and expected decline in 2026 bottom line, it is better to hold onto this Zacks Rank #3 (Hold) stock presently.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.