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The Progressive Corporation (PGR), headquartered in Mayfield Village, Ohio, operates as an insurance holding company. Valued at $138.2 billion by market cap, it provides personal and commercial auto, residential and commercial property, business-related general liability, and other specialty property-casualty insurance products and related services.
Shares of this leading property & casualty insurance company have outperformed the broader market considerably over the past year. PGR has gained 73.3% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 26.1%. In 2024 alone, PGR stock is up 48.1%, surpassing SPX’s 16.5% rise on a YTD basis.
Zooming in further, PGR’s outperformance looks less pronounced compared to Invesco KBW Property & Casualty Insurance ETF (KBWP). The exchange-traded fund has gained about 31.6% over the past year. Moreover, PGR’s gains on a YTD basis outshine the ETF’s 21.4% returns over the same time frame.
PGR’s solid market performance can be attributed to increased demand for auto insurance policies and rising wages that encouraged customers to revive their spending. The company benefited from higher premiums in the auto insurance market, which has helped offset rising claims costs. With a focus on technology and solid underwriting, PGR has maintained a robust combined ratio and delivered impressive shareholder returns.
On Aug. 14, PGR shares closed up more than 5% after reporting net premiums earned for July of $6.1 billion.
For the current fiscal year, ending in December, analysts expect PGR’s EPS to grow 99% to $12.16 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 19 analysts covering PGR stock, the consensus is a “Moderate Buy.” That’s based on 12 “Strong Buy” ratings, one “Moderate Buy,” and six “Holds.”
This configuration is more bullish than a month ago, with 11 analysts suggesting a “Strong Buy.”
On Aug. 15, Jefferies analyst Yaron Kinar maintained a “Buy” rating on PGR with a price target of $257, implying a potential upside of 9% from current levels.
The mean price target of $249 represents a 5.6% premium to PGR’s current price levels. The Street-high price target of $294 suggests an upside potential of 24.6%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
