The Progressive Corporation’s PGR third-quarter 2019 earnings per share of $1.42 beat the Zacks Consensus Estimate of $1.33. However, the bottom line declined 9% from the year-ago quarter.
Behind the Headlines
Net premiums written were $9.6 billion in the quarter under review, up 12% from $8.6 billion in the year-ago period. Net premiums earned grew 14% year over year to $9 billion.
Net realized gains on securities were $65.4 million compared with $182.1 million in the year-ago quarter.
Combined ratio — percentage of premiums paid out as claims and expenses — deteriorated 160 basis points (bps) from the prior-year quarter’s level to 91.9%.
The Progressive Corporation Price, Consensus and EPS Surprise
The Progressive Corporation price-consensus-eps-surprise-chart | The Progressive Corporation Quote
September Numbers Solid
Operating revenues were $2.9 million, up 13.1% year over year. The improvement can be attributed to 13.1% increase in premiums, 14.1% higher investment income, 9.8% growth in fees and other revenues and 18.1% rise in service revenues.
Total expenses increased 15.8% year over year to $2.7 billion due to 16.7% rise in losses and loss adjustment expenses, 12% increase in policy acquisition costs and 13.4% higher other underwriting expenses.
In September, policies in force were impressive at the Personal Auto segment, having improved 11% from the year-ago month to 14.6 million. Special Lines improved 3% from the prior-year month’s figure to 4.6 million.
In Progressive’s Personal Auto segment, Direct Auto grew 10% year over year to 6.9 million while Agency Auto improved 12% year over year to 7.7 million.
Progressive’s Commercial Auto segment rose 8% year over year to 0.7 million. The Property business had about 2.1 million policies in force in the month, up 15% year over year.
Progressive’s book value per share was $23.31, as of Sep 30, 2019, up 19.6% from $19.49 as of Sep 30, 2018.
Return-on-equity in September 2019 was 32.7%, having expanded 560 bps year over year. Debt-to-total capital ratio improved 80 bps year over year to 23.8% as of Sep 30, 2019.
Progressive currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
W.R. Berkley Corporation WRB will release third-quarter 2019 earnings on Oct 22. The Zacks Consensus Estimate for its earnings per share stands at 67 cents.
The Travelers Companies, Inc. TRV will release third-quarter 2019 earnings on Oct 22. The Zacks Consensus Estimate for earnings per share is pegged at $2.40.
Chubb Corporation CB will release third-quarter 2019 earnings on Oct 29. The Zacks Consensus Estimate for earnings per share is pegged at $2.66 cents.
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