Financial Data and Key Metrics Changes - In 2024, net premiums written grew approximately 21% year-over-year, finishing at $74.4 billion, with an absolute increase of nearly $13 billion in a single calendar year [16][18]. - The combined ratio (CR) for 2024 was 88.8%, significantly below the target of 96 and about 6 points lower than in 2023 [19][20]. - The company achieved a record increase of more than 5 million active policies, more than doubling the previous highest annual growth rate [17][18]. Business Line Data and Key Metrics Changes - The claims organization played a critical role in enhancing competitive pricing through improved accuracy and efficiency, contributing to the overall growth and profitability of the company [12][20]. - The claims organization achieved the lowest loss adjustment expense (LAE) ratio in its history, alongside improved accuracy and customer satisfaction [41][42]. Market Data and Key Metrics Changes - The company maintained a seven-point advantage in loss ratio compared to the industry, with a near nine-point improvement in total indemnity from 2023 to 2024, finishing below 70% [40][41]. - The company reported a significant increase in engagement and satisfaction scores, ranking in the 98th percentile for engagement and the 99th percentile for overall satisfaction among U.S. companies [27][28]. Company Strategy and Development Direction - The company focuses on two strategic pillars: People and Culture, and Competitive Pricing, emphasizing the importance of technology investments in the claims process [5][12]. - The company aims to balance growth and profitability while continuously improving its operational efficiency and customer experience [20][30]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's pricing position and growth potential for 2025, despite moderating pricing increases and industry dynamics [109][111]. - The company is committed to maintaining stable rates for customers to improve retention and overall policy growth [130][131]. Other Important Information - The company has made significant investments in technology and data analytics to enhance claims processing and operational efficiency [45][52]. - The company is exploring advanced technologies such as machine vision and 3D Gaussian Splatting to improve accuracy and efficiency in claims handling [90][96]. Q&A Session Summary Question: Comments on pricing and future growth - Management indicated a strong pricing position and the ability to adjust rates as needed to achieve target profit margins while aiming for growth [109][111]. Question: Advertising spend and cost per sale - Management noted that the cost per sale is now closer to targeted acquisition costs and emphasized the importance of efficient advertising spend [122][123]. Question: Retention and policy life expectancy - Management acknowledged the decline in policy life expectancy due to rate increases but emphasized efforts to stabilize rates to improve retention [128][130]. Question: Impact of tariffs on margins - Management discussed the potential impact of tariffs on costs and the need to balance growth with rising expenses in the second half of the year [135].

Financial Performance - Total investment income for 2024 was $3.1 billion, up from $2.3 billion in 2023 and a loss of $0.7 billion in 2022[67] - On a pretax total return basis, the investment portfolio generated $3.3 billion in 2024, compared to $3.8 billion in 2023 and a loss of $4.3 billion in 2022[67] - The service businesses represented less than 1% of total revenues for 2024, 2023, and 2022, indicating minimal impact on overall operations[68] - The company’s liabilities for property-casualty losses and loss adjustment expenses are determined using actuarial and statistical procedures[69] Employee Engagement and Retention - The annualized employee retention rate for 2024 was 89%, an increase of three percentage points from the previous year[76] - Over 75% of open positions above entry level were filled by promoting from within, including over 2,100 managerial positions in 2024[76] - The company’s engagement and culture survey results placed it in the top 2% of all companies surveyed, indicating high employee engagement[75] - As of December 31, 2024, the company had approximately 66,300 employees[76] - The company has nine Employee Resource Groups (ERGs), with 44% of employees belonging to at least one ERG as of December 31, 2024[80] - The company offers a 401(k) plan with up to a 6% company match as part of its employee benefits[83]

Group 1: Goldman Sachs - Goldman Sachs' shares have outperformed the Zacks Financial - Investment Bank industry over the past year, with a growth of +72.7% compared to +42.6% for the industry [5] - The company's restructuring initiatives are expected to enhance its presence in overseas markets, supported by decent cash levels and a solid credit profile [5][6] - Despite strong earnings performance, the global banking and markets division may face pressure due to capital market volatility and geopolitical concerns [6] Group 2: Progressive Corp. - Progressive's shares have outperformed the Zacks Insurance - Property and Casualty industry over the past year, with a growth of +41.3% compared to +18% for the industry [7] - The company is benefiting from higher premiums and a strong product portfolio, focusing on becoming a one-stop insurance destination [7][8] - However, exposure to catastrophe losses and escalating expenses pose challenges to its margins [9] Group 3: Boston Scientific - Boston Scientific's shares have outperformed the Zacks Medical - Products industry over the past year, with a growth of +60.2% compared to +13.9% for the industry [10] - The company is experiencing strong demand across its MedSurg and Cardiovascular lines, with positive contributions from acquisitions [10][11] - Despite macroeconomic concerns, the company expects strong organic growth in 2025, although rising costs and foreign exchange headwinds are significant risks [12] Group 4: Cooper-Standard Holdings Inc. - Cooper-Standard's shares have declined -3.9% over the past year, while the Zacks Automotive - Original Equipment industry has seen a decline of -9.2% [13] - The company achieved a 96.8% year-over-year increase in adjusted EBITDA to $54.3 million, driven by cost optimizations [13] - However, high debt levels and rising interest costs present risks, alongside challenges from weak global auto production and pricing pressures [15]

Core Viewpoint - Progressive has shown strong performance in its recent earnings report, with significant increases in earnings per share and operating revenues, indicating positive momentum leading into the next earnings release [2][4]. Financial Performance - Q4 2024 earnings per share reached $4.08, exceeding the Zacks Consensus Estimate by 19%, and reflecting a year-over-year increase of 37.8% [2]. - Operating revenues for Q4 2024 increased by 20.3% year-over-year to $20.3 billion, surpassing the consensus estimate by 2.5% [2]. - Full-year operating revenues rose 21.6% year-over-year to $75.1 billion, driven by a 20.7% increase in net premiums earned and a 49.7% rise in net investment income [4]. Premiums and Policies - Net premiums written in Q4 2024 were $18.1 billion, up 20% from $15.1 billion a year ago, while net premiums earned grew 21% to $19.1 billion, exceeding the Zacks Consensus Estimate of $18.7 billion [3]. - Policies in force in the Personal Lines segment increased by 18% year-over-year to 33.8 million, with notable growth in Direct Auto and Agency Auto segments [5]. Investment Metrics - Progressive's book value per share was $43.67 as of December 30, 2024, reflecting a 29.2% increase from the previous year [6]. - The return on equity improved to 36.4% from 30% year-over-year, and the total debt-to-total capital ratio decreased by 420 basis points to 21.2% [6]. Market Outlook - There has been an upward trend in earnings estimates, with a consensus estimate shift of 17.91% in the past month, indicating positive investor sentiment [7]. - Progressive holds a Zacks Rank 1 (Strong Buy), suggesting expectations for above-average returns in the coming months [9]. Industry Comparison - Progressive operates within the Zacks Insurance - Property and Casualty industry, where competitor Chubb reported a year-over-year revenue increase of 6.8% but has a lower Zacks Rank of 3 (Hold) [10].

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Core Viewpoint - Progressive is expected to show positive earnings growth in its upcoming report, with a projected EPS of $3.99, reflecting a 6.97% increase year-over-year, and revenue forecasted at $20.59 billion, indicating a 20.5% growth compared to the same quarter last year [2]. Financial Performance - The stock price of Progressive recently closed at $273.43, down by 1.83% from the previous day, while the company has seen a 13.66% increase in stock price over the past month [1]. - For the full year, earnings are projected at $14.79 per share and revenue at $87.49 billion, showing increases of 5.27% and 16.48% respectively from the previous year [3]. Analyst Estimates - Recent revisions to analyst estimates for Progressive indicate a positive outlook, with a 5.43% upward shift in the Zacks Consensus EPS estimate over the past month [6]. - The current Zacks Rank for Progressive is 2 (Buy), suggesting a favorable investment sentiment [6]. Valuation Metrics - Progressive has a Forward P/E ratio of 18.83, which is higher than the industry average of 11.08 [7]. - The company also has a PEG ratio of 1.76, compared to the industry average PEG ratio of 1.94, indicating a relatively favorable valuation considering expected earnings growth [8]. Industry Context - The Insurance - Property and Casualty industry, to which Progressive belongs, ranks in the top 18% of all industries according to the Zacks Industry Rank, which is based on the average Zacks Rank of individual stocks within the industry [9].

Industry Overview - The car insurance industry has significantly benefited from rising insurance prices, with the Zacks Insurance – Property and Casualty industry group ranking in the top 18% out of approximately 250 industries, showing relative strength at the start of the year [8] - Auto insurance rates in the US have surged by 55% over the past three years, marking the largest increase since the 1970s, driven by higher traffic levels and repair costs [7][6] Company Performance - The Progressive Corporation (PGR) has outperformed the S&P 500 with a remarkable 1,226% gain over the last decade, continuing its strong performance with an 18% return year-to-date [10][12] - PGR is expected to achieve revenue growth of 16.5%, reaching $87.5 billion this year, supported by higher premiums and a strong product portfolio [15] - Analysts have increased full-year EPS estimates for PGR by 5.79% in the past 60 days, with the 2025 Zacks Consensus Estimate at $14.79 per share, reflecting a 5.3% growth rate compared to the previous year [16]

Core Viewpoint - Momentum investing focuses on following a stock's recent price trends, aiming to buy high and sell higher, with the expectation that established trends will continue [1][2]. Company Overview: Progressive (PGR) - Progressive currently holds a Momentum Style Score of A, indicating strong potential for momentum investing [3]. - The company has a Zacks Rank of 2 (Buy), suggesting it is positioned for outperformance in the market [4]. Performance Metrics - Over the past week, PGR shares increased by 1.37%, while the Zacks Insurance - Property and Casualty industry declined by 1.18% [6]. - In a longer timeframe, PGR's monthly price change is 13.66%, significantly outperforming the industry's 1.72% [6]. - Over the last quarter, PGR shares rose by 6.06%, and over the past year, they increased by 44.93%, compared to the S&P 500's movements of -0.17% and 18.49%, respectively [7]. Trading Volume - PGR's average 20-day trading volume is 2,397,913 shares, which serves as a bullish indicator when combined with rising stock prices [8]. Earnings Outlook - In the past two months, 8 earnings estimates for PGR have been revised upwards, while only 1 has been revised downwards, leading to an increase in the consensus estimate from $13.98 to $14.79 [10]. - For the next fiscal year, 6 estimates have moved upwards with no downward revisions during the same period [10]. Conclusion - Given the strong performance metrics and positive earnings outlook, PGR is positioned as a solid momentum pick with a Momentum Score of A and a Zacks Rank of 2 (Buy) [12].

Core Viewpoint - Investors are seeking growth stocks that can deliver above-average growth and exceptional returns, but identifying such stocks is challenging due to inherent volatility and risks [1] Group 1: Growth Stock Identification - The Zacks Growth Style Score system aids in identifying promising growth stocks by analyzing real growth prospects beyond traditional metrics [2] - Progressive (PGR) is highlighted as a recommended stock with a favorable Growth Score and a top Zacks Rank [2] Group 2: Earnings Growth - Earnings growth is a critical factor for growth investors, with double-digit growth being particularly attractive [4] - Progressive's historical EPS growth rate is 7.5%, but projected EPS growth for this year is 4.5%, surpassing the industry average of 4.2% [5] Group 3: Asset Utilization - The asset utilization ratio, or sales-to-total-assets (S/TA) ratio, is an important metric for assessing a growth stock's efficiency [6] - Progressive's S/TA ratio is 0.75, indicating it generates $0.75 in sales for every dollar in assets, significantly higher than the industry average of 0.35 [6] Group 4: Sales Growth - Sales growth is another key indicator, with Progressive expected to achieve a 16.6% sales growth this year, compared to the industry average of 7.3% [7] Group 5: Earnings Estimate Revisions - Positive trends in earnings estimate revisions correlate strongly with stock price movements [8] - The current-year earnings estimates for Progressive have increased by 4.6% over the past month, indicating positive momentum [8] Group 6: Overall Assessment - Progressive has earned a Growth Score of A and a Zacks Rank 2 due to positive earnings estimate revisions, suggesting it is a solid choice for growth investors [10]

Core Insights - The Progressive Corporation (PGR) reported strong financial results for January 2025, with net premiums written increasing by 18% year over year and an improvement in the combined ratio by 320 basis points to 84.1 [1][3]. Financial Performance - Earnings per share for January 2025 reached $1.90, reflecting a 61% year-over-year increase [3]. - Operating revenues rose by 22.8% year over year to $6.9 billion [3]. Policy Growth - Policies in force in the Personal Lines segment increased by 18% to 33.8 million [4]. - Direct Auto policies grew by 25% to 14.2 million, while Agency Auto policies increased by 18% to 9.9 million [4]. - The Commercial Auto segment rose by 5% to 1.1 million policies, and the Property business had 3.5 million policies in force, up 13% [4]. Market Position and Strategy - PGR is a leading auto insurance group with a strong market presence and a diverse product portfolio [2]. - The company is focusing on auto bundles, reducing exposure to risky properties, and enhancing segmentation through new product rollouts [6]. Underwriting and Financial Health - PGR's combined ratio has averaged less than 93% over the past decade, significantly better than the industry average of over 100% [7]. - The company maintains a solid cash flow, allowing for continuous investment in digitalization and operational improvements [8]. Analyst Sentiment and Growth Projections - Recent analyst estimates for 2025 earnings have increased by 1.7%, with a consensus estimate of $14.68 per share, indicating a 4.5% year-over-year growth [9][10]. - The long-term earnings growth rate is projected at 10.7%, surpassing the industry average of 7.6% [11]. Stock Performance - PGR shares have gained 11.8% year to date, outperforming the industry and broader market indices [12]. - The average price target for PGR suggests a potential upside of 5.7% from recent closing prices [17]. Valuation Metrics - PGR is currently trading at a price-to-book (P/B) multiple of 6.13, significantly higher than the industry average of 1.64, which is justified by its market leadership and growth prospects [19]. - Return on equity for the trailing 12 months was 33.8%, compared to the industry's 7.6%, indicating efficient use of shareholder funds [22].