On Aug 12, 2014,
) scaled a 52-week high of $60.19 after posting mixed
second-quarter results which included a 26.3% positive earnings
surprise. This major insurance firm has maintained an earnings
streak in the last four quarters with an average beat of 18.8%.
In fact, shares of Allstate rose nearly 5.7% over the last few
trading sessions to close at $60.15, since the company reported
second-quarter earnings results on Jul 30, 2014. Furthermore, the
year-to-date return of the stock is 10.28%, much above the S&P
500's return of 4.62% as well as that of other players in the
insurance industry like Travelers Inc. (
) and Lincoln National Corp. (
) that generated returns of 0.61% and -0.50%, respectively over the
During the second quarter, Allstate's top line surpassed our
estimates and increased 0.8% year over year. Additionally, the
Property-Liability's earned premiums rose during the quarter owing
to decent performance across the Allstate, Encompass and Esurance
brands, modest growth in new business and customer retention across
standard auto and personal lines' businesses.
During the second quarter, Allstate's investment position remained
strong, reflecting increased fixed income valuations and positive
equity market performance in 2014. Moreover, Allstate delivered
impressive performance in terms of deleveraging its portfolio,
reflected by the 200 basis points improvement in the
Allstate's commitment to return more value to its shareholders is
evident from the completion of 40% of the $2.5 billion share
repurchase program authorized in Feb 2014 and the consistent
Currently, Allstate caries a Zacks Rank #3 (Hold). Investors
interested in the property and casualty insurance space may
consider stocks like Endurance Specialty Holdings Ltd. (
), which sports a Zacks Rank #1 (Strong Buy).
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