There are both strong cases to go long or short Allstate. On one hand it is one of the insurance giants in the biggest economy in the world. An economy where coverage is written in the law books. On the other hand this country has been faltering on a number of different fronts bringing into question, will customer volume contract? Will rates become more competitive instead of continuing higher?
The movement in the stock price is bearish at the moment, yet the dividend yield is becoming a more compelling reason to buy as it reaches 4%. The stock has performed poorly relative to indexes and recently, sector peers. Support over the past 10 years can be seen at about $30.
The P/E ratio is very high and there are tons of shares out there, but at the same time this is something that funds will want a piece of due to the company's size, history, cash flow, business model etc.
This is a company that if given time (without making horrible acquisitions or an extaordinarily high amount of natural disasters occurring)will win. The only people I'd say this stock isn't for is Global Warming/Extreme Weather theorists. Everyone else, the bottom is in, this should gravitate towards that $30 level the second the green #'s come out. When all the technical traders step in because this thing starts to break out, I expect big things here.
Hope I'm not wrong, in the end it's a gamble. In @ 23.20