) operating earnings for July 2014 came in at 18 cents per share, a
couple of cents higher year over year.
Including net realized gains on securities (including net
impairment losses), net income came in at 20 cents per share,
comparing favorably with 17 cents earned in July 2013.
Progressive recorded $1.8 billion net premiums written, up 4% from
$1.7 billion in the year-ago month. Net premiums earned of $1.7
billion were up 5% from $1.6 billion in the year-ago month.
Combined ratio − the percentage of premiums paid out as claims and
expenses − improved 110 basis points (bps) from the prior-year
month to 91.6%.
Progressive publishes monthly financial reports. In the month of
July, policies in force were healthy, with the Personal Auto
segment increasing 3% year over year to 9.2 million. Special Lines
increased 1% year over year to 4.1 million.
In Progressive's Personal Auto segment, Direct Auto grew 7% year
over year to 4.4 million. Agency Auto remained almost flat year
over year at 4.8 million. Progressive's Commercial Auto segment
declined 2% on a year-over-year basis.
Total revenue improved 5% year over year to $1.8 billion, largely
driven by higher premiums.
On the other hand, total expense increased 4.2% to $1.6 billion in
July. The major components contributing to the rise in total
expense were a 5% increase in losses and loss adjustment expenses,
1% higher other underwriting expenses and a 3.2% rise in policy
Progressive reported book value per share of $11.52 on Jul 31, up
3.3% year over year.
Return on equity on a trailing 12-month basis was 17.5% compared
with 18.8% in Jul 2013. The debt-to-total capital ratio was 24.5%
as of Jul 31, 2014, deteriorating from 23.5% as of Jul 31, 2013.
Progressive carries a Zacks Rank #3 (Hold). Better-ranked property
and casualty insurers worth considering are Endurance Specialty
Holdings Ltd. (
), Global Indemnity plc (
) and Greenlight Capital Re, Ltd. (
). All these stocks sport a Zacks Rank #1 (Strong Buy).
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