Core Points - Progressive Insurance has become the title sponsor for several high-profile Bassmaster properties, including the Bassmaster Angler of the Year award [1][2] - The Bassmaster Elite Series will now be known as the Progressive Bassmaster Elite Series, enhancing event experiences and coverage [3] - Progressive will sponsor the Bassmaster Classic Celebrity Pro-Am, featuring celebrities and professional anglers for charitable causes [4] - The Bassmaster Tailgate Experience will be sponsored by Progressive at the Bassmaster Classic and one select Elite Series tournament, offering interactive activities and exclusive merchandise [5] - Attendees at the Bassmaster Classic will receive custom Progressive-branded buckets as a giveaway [6] - B.A.S.S. CEO Chase Anderson expressed excitement about the partnership, highlighting Progressive's commitment to innovation and community involvement [7] - Progressive aims to engage with the angler community and enhance the excitement of Bassmaster events [7] - The sponsorship will officially begin with the 2025 Progressive Bassmaster Elite Series season and will be featured during the Bass Pro Shops Bassmaster Classic on March 21-23, 2025 [7] Company Information - Progressive Insurance is a leading provider of various insurance products, including personal and commercial auto, motorcycle, boat, and home insurance [9][10] - Founded in 1937, Progressive is the second-largest personal auto insurer in the U.S. and offers innovative shopping tools and services [10] - B.A.S.S. is the worldwide authority on bass fishing, providing a range of media platforms and events dedicated to the sport [12] - The organization has been committed to access, conservation, and youth fishing for over 50 years [12]

Market Overview - The U.S. stock market is expected to remain volatile due to uncertainty surrounding trade policies, economic concerns, and shifts in investor sentiment, particularly influenced by President Trump's tariffs on major trading partners [1] - Retaliatory measures from trading partners have heightened market anxiety, despite temporary rebounds from hopes for tariff concessions [1] - Key economic indicators such as jobless claims, payroll reports, and corporate earnings are likely to further influence market movements [1] Investment Strategy - Creating a curated portfolio of low-beta stocks is recommended as a strategy to safeguard against market fluctuations [2] - Low-beta stocks such as The Progressive Corporation (PGR), Pearson plc (PSO), TXO Partners LP (TXO), and Jazz Pharmaceuticals plc (JAZZ) are highlighted as potential investment opportunities [2] Company Highlights The Progressive Corporation (PGR) - In 2024, PGR reported a 21% year-over-year increase in net premiums written, totaling $74.4 billion, with active policies growing by over 5 million [7] - The company achieved an 88.8 combined ratio, outperforming its 96 target, driven by strong claims management and operational efficiencies [7] - PGR's competitive advantages in pricing and customer service position it well for continued growth in the insurance sector [7] Pearson plc (PSO) - Pearson experienced a 3% sales growth in 2024, with profits rising by 10% and an EBIT margin of 16.9% [9] - Strategic partnerships with AWS and Microsoft are enhancing Pearson's AI capabilities and expanding enterprise learning opportunities [9] - The company's leadership in assessments and innovative digital offerings support its long-term growth outlook [9] Jazz Pharmaceuticals plc (JAZZ) - Jazz Pharmaceuticals reported annual revenues exceeding $4 billion in 2024, with fourth-quarter revenues reaching a record $1.09 billion [10] - The company's diversified portfolio in sleep, epilepsy, and oncology continues to drive growth, with key products showing strong performance [10] - Robust cash flow and a strong pipeline position JAZZ for continued growth and value creation [10] TXO Partners LP (TXO) - TXO Partners has a strong presence in the oil-rich Permian Basin, benefiting from exploration and production activities [11] - The Mancos Shale project, covering 58,500 contiguous acres, holds nearly 3 trillion cubic feet of natural gas potential, which could significantly increase reserves [11] - Phase I of the project targets a 3,520-acre block estimated to hold 200-300 billion cubic feet of natural gas, potentially doubling existing reserves [11]

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].

Core Viewpoint - The content emphasizes the importance of conducting personal due diligence and consulting competent advisors before making any financial decisions, particularly in the context of investments and trading [1] Group 1 - The website provides general news, personal analysis, and third-party content intended for educational and research purposes [1] - It explicitly states that the information does not constitute any recommendation or advice for investment actions [1] - Users are advised to perform their own research and consider their financial situation before making decisions [1] Group 2 - The website includes information about complex financial instruments such as cryptocurrencies and contracts for difference (CFDs), which carry a high risk of losing money [1] - It encourages users to understand how these instruments work and the associated risks before investing [1] - The content does not guarantee real-time accuracy or reliability of the information provided [1]

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].