Progressive Rises on Higher Premium - Analyst Blog

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Progressive Corp. 's ( PGR ) earnings per share for Oct 2013 were 19 cents, surging 46.1% from 13 cents in the year-ago month. Net income also increased 47.2% year over year to $112.3 million.

Progressive Corp. recorded net premiums written of $1.66 billion in the month under review, up 5.6% from $1.57 billion in the year-ago month. Net premiums earned were $1.67 billion, up 5.8% from $1.57 billion in the year-ago month.

Net realized gains on securities in the month were $4.8 million, plummeting from $24.3 million in the year-ago quarter. Combined ratio − the percentage of premiums paid out as claims and expenses − improved 500 basis points from the prior-year month to 91.5% in the reported month.

Numbers in October

Progressive Corp. publishes monthly financial reports. During October, policies in force remained healthy, with the Personal Auto segment increasing 2.2% year over year and almost unchanged sequentially. Special Lines increased 1.2% year over year but decreased 0.5% sequentially.

In Progressive Corp.'s Personal Auto segment, Direct Auto grew 4.5% year over year and 0.5% over the preceding month. Agency Auto increased 0.3% year over year, although remained in line with preceding month level. Progressive's Commercial Auto segment declined 0.4% from the year-ago period as well as sequentially.

Total expenses for the reported month increased 2.2% to $1.56 billion from $1.53 billion in Oct 2012. The increase was mainly attributable to a 27.6% rise in other underwriting expenses and 2.6% increase in policy acquisition costs.

Progressive Corp. reported book value per share of $11.68 on Oct 31, 2013, up from $11.32 as of Sep 30, 2013.

Return on equity on a trailing 12-month basis was 17.9%, compared with 17.5% in Sep 2013. The debt-to-total capital ratio was 21% as of Oct 31, 2013, improving from 22.8% as of Sep 30, 2013.

Progressive Corp. presently carries a Zacks Rank #3 (Hold). Other insurers Alleghany Corp. ( Y ), Allied World Assurance ( AWH ) and The Hanover Insurance Group Inc. ( THG ), each carrying a Zacks Rank #1 (Strong Buy) appear impressive.



ALLIED WORLD AS (AWH): Free Stock Analysis Report

PROGRESSIVE COR (PGR): Free Stock Analysis Report

HANOVER INSURAN (THG): Free Stock Analysis Report

ALLEGHANY CORP (Y): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: AWH , PGR , THG , Y

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