The Progressive Corporation (NYSE:PGR) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 18, The Progressive Corporation (NYSE:PGR) reported its January 2026 results. The company grew its net premiums written by 4% year-over-year to $6.735 billion and net premiums earned by 5% to $6.921 billion. The total net income for the month came in at $1.163 billion, reflecting 4% increase year-over-year. ​The pretax net realized gains on securities totaled $103 million for the month, refle ...

Core Insights - The Progressive Corporation (PGR) reported earnings per share of $1.98 for January 2026, reflecting a 4% year-over-year increase driven by higher revenues and investment income, despite rising expenses [1][7] Financial Performance - Total revenues for Progressive reached $7.5 billion, marking a 5.3% increase year over year, attributed to a 5% rise in premiums and a 16% increase in investment income [3][7] - Net premiums written were $6.7 billion, up 4% from $6.5 billion in the same month last year, while net premiums earned rose 5% to approximately $6.9 billion [2] - The combined ratio deteriorated by 30 basis points year over year to 84.4, indicating a slight increase in claims and expenses relative to premiums [2] Policy Growth - Policies in force (PIF) in the Vehicle business increased significantly, with Personal Auto segment policies rising 10% to 37.6 million and Direct Auto policies improving 14% to 16.1 million [4] - The Property business also saw growth, with 3.6 million policies in force, up 3% year over year [5] Investment Metrics - The book value per share increased by 16.4% to $53.24 as of January 31, 2026, compared to $45.75 a year earlier [5] - The return on equity for the trailing 12 months was 38.9%, up 130 basis points from 37.6% in January 2025 [5] - The debt-to-total-capital ratio improved by 230 basis points year over year to 18.1 as of January 31, 2026 [5] Market Performance - Progressive shares have experienced a decline of 24.6% over the past year, contrasting with the industry's growth of 3.5% [6]

MAYFIELD VILLAGE, OHIO, Feb. 18, 2026 (GLOBE NEWSWIRE) -- The Progressive Corporation (NYSE:PGR) today reported the following results for the month ended January 31, 2026: January(millions, except per share amounts and ratios; unaudited)2026 2025 ChangeNet premiums written$6,735 $6,481 4 <td ...

Core Viewpoint - The Progressive Corporation (NYSE:PGR) is recognized as a strong long-term investment option, particularly in the retirement stock category, with analysts maintaining positive ratings despite some price target adjustments. Group 1: Analyst Ratings and Price Targets - UBS has reduced its price target for Progressive Corporation to $226 from $234 while maintaining a Buy rating, citing steady revenue growth and stronger margins for insurance brokers through 2026 [1] - Goldman Sachs has reiterated a Buy rating with a price target of $230, following solid results for December, including a 6% increase in net premiums written to $6.31 million and a 6% rise in net premiums earned to $7.12 million [2] - Keefe, Bruyette & Woods has maintained a Market Perform rating but lowered the price target to $225 from $252 due to concerns over moderation in Personal Auto Policies in force (PIF) growth [5] Group 2: Financial Performance - In December, net income increased by 22% to $1.14 million, while net premiums for the fourth quarter rose by 8% to $19.51 million, and net premiums earned increased by 10% to $21.1 million, with net income for the quarter up 25% to $2.95 million [3] - Goldman Sachs has highlighted stable earnings per share estimates for 2026, 2027, and 2028, and has increased its growth forecast for Personal Auto Policies in force by 30 basis points to 8.1%, supported by improved advertising efficiency [4] Group 3: Company Overview - The Progressive Corporation is a major American insurance holding company, recognized as the second-largest personal auto insurer and a leading commercial auto insurer, providing a range of insurance products directly to consumers and through agents [6]

Core Insights - Auto insurance premiums are rising across the United States, affecting even drivers with clean records, as insurers consider various factors beyond individual driving history [2][3] Industry Analysis - Insurers calculate rates based on regional repair costs, medical expense inflation, litigation trends, and regulatory processes, leading to continuous premium increases regardless of personal driving behavior [3][9][10] - Repair costs are a significant factor in premium growth, as modern vehicles with advanced technology are more expensive to repair after accidents [9] - Medical inflation is another pressure point, with healthcare costs rising faster than general inflation, necessitating higher payouts in insurance rate structures [10] - Litigation trends contribute to rising costs, with some regions experiencing more frequent lawsuits and larger jury awards, resulting in "social inflation" that affects all policyholders [11] Company Performance - Progressive Corp reported a 40.5% return on equity (ROE) with a quarterly earnings growth of 25.2%, while Allstate achieved a 34.5% ROE with an impressive 222% quarterly earnings growth [5][12] - Both companies have successfully passed rising repair and medical costs onto consumers while maintaining high profit margins [5][12] Investment Opportunity - The insurance sector is identified as a profitable investment opportunity due to its strong financial performance despite ongoing cost pressures [8]

Core Viewpoint - The Progressive Corporation (PGR) has significantly underperformed the broader market and its peers in the property and casualty insurance sector over the past year, despite reporting positive quarterly earnings results. Group 1: Company Overview - The Progressive Corporation is an insurance holding company based in Mayfield Village, Ohio, with a market capitalization of $118.6 billion, offering various insurance products including personal and commercial auto, property, and specialty property-casualty insurance [1]. Group 2: Stock Performance - PGR shares have declined by 19.6% over the past year, while the S&P 500 Index has increased by nearly 15.6% during the same period [2]. - Year-to-date in 2026, PGR stock is down 11.5%, contrasting with a 1.7% rise in the S&P 500 Index [2]. - Compared to the Invesco KBW Property & Casualty Insurance ETF, which gained about 5.8% over the past year, PGR's performance remains weak [3]. Group 3: Financial Results - On January 28, PGR reported Q4 results with an EPS of $4.45, reflecting a year-over-year increase of 12.1%, and adjusted revenue of $22.5 billion, surpassing Wall Street's expectations of $21.9 billion [5]. Group 4: Analyst Expectations - For the current fiscal year ending in December, analysts project PGR's EPS to decline by 11.1% to $16.23 on a diluted basis [6]. - Among 25 analysts covering PGR, the consensus rating is a "Moderate Buy," with a mix of ratings including eight "Strong Buy," two "Moderate Buy," 13 "Holds," one "Moderate Sell," and one "Strong Sell" [6]. - Citigroup analyst Matthew Heimermann maintained a "Buy" rating on PGR, lowering the price target to $261, indicating a potential upside of 29.5% from current levels [7].

Core Insights - Progressive reported operating earnings per share of $18.27 for 2025, significantly exceeding the consensus estimate of $15.58, driven by strong personal auto policy growth, despite a 23% decline in stock price since April 2025, indicating a disconnect between market sentiment and operational performance [1] Group 1: Earnings Performance - The outperformance in earnings highlights the company's resilience in a challenging market environment [1] - Progressive's policy growth forecast for the first quarter of 2026 is expected to be 3.5%, surpassing the Street's estimate of 2.5%, aligning with historical seasonality trends [3] Group 2: Market and Regulatory Environment - Florida's tort reform is seen as a positive development, having already reduced claims costs, lowered litigation frequency, and improved underwriting margins [2] - The potential impact of autonomous vehicles is viewed positively, with the argument that they could enhance capital utilization and underwriting efficiency for insurers with scale and data advantages [2] Group 3: Price Forecast and Valuation - The revised price forecast for Progressive is set at $329, based on a 19.2x price-to-earnings multiple applied to normalized 2028 EPS of $17.12 [4] - Despite near-term stock volatility, Progressive is considered well-positioned to continue outperforming expectations due to strong execution, regulatory tailwinds, and technology-driven efficiency gains [4] Group 4: Stock Performance - At the time of publication, Progressive shares were down 0.09% at $202.10, close to its 52-week low of $197.92 [5]

Core Insights - Genentech, a member of the Roche Group, announced that its investigational BTK inhibitor fenebrutinib met the primary endpoint of non-inferiority compared to Ocrevus in reducing disability progression in patients with primary progressive multiple sclerosis [1] Group 1 - The Phase III FENtrepid study demonstrated a 12% reduction in the risk of disability progression with fenebrutinib compared to Ocrevus [1]

Group 1: Market Overview - The stock market is currently considered historically expensive, with the Shiller price-to-earnings ratio indicating one of the priciest markets in history [1] - Despite high valuations, there are still investment opportunities available for those looking for solid value [1] Group 2: Chevron (CVX) - Chevron operates in the volatile oil and gas industry with an integrated business model that helps stabilize earnings [5] - The company has focused on efficient operations and a mix of short-cycle and long-cycle assets, including the acquisition of the Stabroek Block in Guyana, which offers low-cost, multidecade production capabilities with a break-even price of $30 per barrel [6] - Chevron is projected to have earnings per share of $9.09 in 2027 and $11.01 in 2028, despite trading at about 25 times this year's projected earnings [7] Group 3: Progressive (PGR) - Progressive is a leading automotive insurance company known for its strong underwriting profitability, consistently aiming for a minimum underwriting profit of 4% of total premiums written [8] - The stock has declined 30% from its all-time high due to increased competition in the insurance market and slower premium growth following inflation [9]

Core Viewpoint - Insurance stocks are showing resilience and outperforming the broader market, gaining 6% over the past three months as volatility affects other sectors [1]. Group 1: Performance of Insurance Stocks - The iShares U.S. Insurance exchange-traded fund has increased by 6% in the last three months, indicating strong performance amidst market turbulence [1]. - Insurance stocks are characterized as "boring" but are proving to be a stable investment option during volatile market conditions [1]. Group 2: Market Context - The broader financial sector is experiencing significant volatility, yet insurance stocks are managing to deliver steady gains [1]. - The performance of insurance stocks suggests a potential shift in investor preference towards more stable and less volatile sectors during uncertain market times [1].