Progressive (PGR) January Earnings Grow on Higher Revenues

Shares of Progressive Corp .'s PGR gained 6.1% in the last two trading sessions after the company posted improved January results. Shares outperformed the Property and Casualty Insurance industry that gained 3.71% in the last two trading sessions.

Operating earnings per share of 30 cents surged nearly 67% year over year on higher revenues. Including net realized gains, net income per share was 31 cents, up about 82% year over year.

Numbers in January

Progressive recorded net premiums written of $2.4 billion in Jan 2016, up 11% from $2.0 billion in the year-ago month. Net premiums earned were about $2.3 billion, up 14% year over year from $2.0 billion.

Net realized gains on securities in the quarter were $9.41million. The company had incurred a loss of $6.2 million a year ago. Combined ratio − the percentage of premiums paid out as claims and expenses − improved 340 basis points (bps) from the prior-year quarter to 89.7%.

Total operating revenue came in at $2.4 billion. The top line improved 14% year over year due to a 14% increase in premiums, 8% higher fees and other revenues, 6% rise in investment income and 13% growth in service revenues.

Total expense increased 10% to $2.1 billion. The increase in expenses can be primarily attributed to 9% higher losses and loss adjustment expenses, 14% rise in policy acquisition costs and 13% higher other underwriting expenses.

In Jan 2017, policies in force were impressive with the Personal Auto segment improving 8% year over year to 10.5 million. Special Lines inched up 3% from the prior-year month to 4.2 million.

In Progressive's Personal Auto segment, Direct Auto grew 8% year over year to 5.4 million. Agency Auto climbed 7% from the comparable year-ago month to 5.1 million.

Progressive's Commercial Auto segment grew 8% year over year to 0.6 million. The Property business had about 1.2 million policies in force in the reported month, up 16% year over year.

Progressive's book value per share was $14.10 as of Jan 31 2017, down 17% from $12.53 as of Jan 31, 2016.

Return on equity on a trailing 12-month basis was 17.4%, up 380 bps from 13.6% in Jan 2016. Debt-to-total capital ratio too deteriorated 80 bps year over year to 28.3% as of Jan 31, 2017.

Progressive Corporation (The) Price

Progressive Corporation (The) Price | Progressive Corporation (The) Quote

Zacks Rank and Other Insurers

Progressive carries a Zacks rank #2 (Buy). Investors interested in the property and casualty industry can also consider American Financial Group, Inc. AFG , Everest e Group Ltd. RE and White Mountains Insurance Group, Ltd. WTM . Each of these stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .

American Financial Group engages primarily in property and casualty (P&C) insurance with focus on specialized commercial products for businesses. Shares of the company gained 5.74% year to date.

Everest Re Group writes P&C, reinsurance and insurance in the U.S, Bermuda and international markets. Its shares rallied 8.94% year to date.

White Mountains engages in insurance, reinsurance, and insurance services businesses. Its shares gained 8.69% year to date.

Just Released - Driverless Cars: Your Roadmap to Mega-Profits Today

In this latest Special Report, Zacks' Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making - autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Everest Re Group, Ltd. (RE): Free Stock Analysis Report

Progressive Corporation (The) (PGR): Free Stock Analysis Report

American Financial Group, Inc. (AFG): Free Stock Analysis Report

White Mountains Insurance Group, Ltd. (WTM): Free Stock Analysis Report

To read this article on click here.

Zacks Investment Research

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

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

In This Story


Other Topics

Earnings Stocks

Latest Markets Videos


    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at

    Learn More