Progressive Corporation Stock: Is Wall Street Bullish or Bearish?

The Progressive Corporation (PGR), headquartered in Mayfield Village, Ohio, is an insurance provider with a market cap of $150.3 billion. Known for its innovation in the insurance industry, Progressive specializes in auto, home, and commercial insurance, offering a wide range of products to meet the needs of individuals and businesses alike.

Progressive Corporation stock has outperformed the broader market over the last year. The stock has gained 62.8% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 30.6%. In 2024 alone, PGR stock is up 61.1%, compared to the SPX, which is up 23.6% on a YTD basis.

Narrowing the focus, PGR has outperformed the Invesco KBW Property & Casualty Insurance ETF (KBWP).  The exchange-traded fund has gained 37.2% over the past 52 weeks and 34.7% on a YTD basis, trailing behind the stock gains.

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PGR stock has been rallying past its industry peers in 2024, fueled by sharp hikes in personal auto insurance premiums and a booming labor market. Rising wages and strong employment trends have encouraged consumers to spend more on auto coverage, a core driver for Progressive. These tailwinds have also propelled the stock surge past the broader market, solidifying its position as a standout in the property and casualty insurance sector.

Progressive Corporation reported a 19% increase in net premiums written for October 2024, with net income rising slightly to $408.2 million. 

Following the release of its Q3 earnings on Oct. 15, shares rose by 1.5% during the subsequent trading session. The company outperformed expectations, with adjusted revenue coming in at $19.43 billion, surpassing the consensus forecast of $18.95 billion. Additionally, adjusted EPS amounted to $3.58, exceeding estimates of $3.40, underscoring Progressive's solid operational execution and profitability.

For the current fiscal year, ending in December, analysts expect PGR’s EPS to grow 113.8% to $13.06 on a diluted basis. The company’s earnings surprise history is robust. It beat the consensus estimate in each of the last four quarters.

Among the 21 analysts covering PGR stock, the consensus is a “Moderate Buy.” That’s based on 13 “Strong Buy” ratings, one “Moderate Buy,” and seven “Holds.” 

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This configuration is slightly more bullish than three months ago, with 12 analysts advising a “Strong Buy.” 

On Nov. 18, Bank of America (BAC) raised Progressive Corporation's price target to $335 from $331, citing better-than-expected October EPS driven by lower catastrophe losses, partially offset by a higher-than-forecast accident-year loss ratio. BofA's price target is also Street-high, which implies an upside potential of 30.6%.

The mean price target of $280.35 represents a 9.3% premium to PGR’s current price levels. 

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On the date of publication, Rashmi Kumari 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.