Progressive(US:PGR)2024-08-15 03:00Investment Rating - The report assigns a 12-month rating of Neutral to Progressive Corporation [5][19]. Core Insights - The report indicates that Progressive Corporation (PGR) experienced better-than-expected growth in Personal Insurance Fund (PIF) in July, although the underlying loss ratio was slightly worse than consensus expectations [2][3]. - PGR's operating EPS for June was reported at $1.30, exceeding the forecast of $0.89, with a favorable prior year development (PYD) of $82.9 million [3][4]. - The agency PIF growth was up 1.8% month-over-month, while direct PIF growth was up 2.4% month-over-month, both surpassing expectations [4]. Summary by Sections Financial Performance - PGR's annualized loss ratio (AYLR) was reported at 66.3%, down 6.3 percentage points year-over-year and up 4 percentage points month-over-month, but below the UBS estimate of 70.1% [4]. - The expense ratio was relatively low at 0.7%, up 5.3 percentage points year-over-year and above the UBS estimate of 19.3% [4]. - Companywide net premium written (NPW) growth was reported at 7.2% year-over-year, significantly above the UBS estimate of 3.9% [4]. Market Position and Outlook - PGR is expected to continue gaining market share as it loosens underwriting restrictions faster than the industry, although growth may slow due to increasing competitive pressures [2]. - The report forecasts a price target of $233.00 for PGR, with a current price of $222.33 [5][19]. - The forecasted stock return is 6.1%, with a price appreciation of 4.8% and a dividend yield of 1.3% [8]. Company Overview - Progressive Corporation is one of the largest personal auto insurers in the US and the largest commercial auto insurer, distributing products through over 35,000 independent agents and direct channels [9].