Somewhere out there, where the greatest marketing mascots live, Flo from the insurance company Progressive (NYSE:PGR) is likely fearing for her job. Progressive’s got a lot less money these days, as seen by its latest earnings report, which also sent share prices plunging in Thursday afternoon’s trading.
The earnings report proved to be a bloodbath. First-quarter earnings per share came in at $0.75, which was a little better than half the average analyst estimate of $1.37. The only kind thing you could say about it was that it was up substantially from the $0.52 it brought in a year prior. Revenue was a bit different, though, as Progressive wrote a total of $16.11 billion in premiums. That was up nicely from the $13.18 billion a year prior. That still only meant a net income of $447.9 million, though. Worse, in March, Progressive lost $151.8 million, down from a gain of $226.5 million back in March 2022.
Progressive did have an explanation ready for that massive March downturn. That downturn was the result of “unfavorable prior-year reserve development of $146.5 million during the month.” Progressive continued in that vein, noting that it was a combination of “personal auto product” and “recently passed legislation in Florida” that contributed to the losses. Commercial losses also contributed to the overall downturn seen in March.
Overall, Wall Street is split on PGR stock. Analyst consensus currently calls Progressive a Moderate Buy. However, with seven Buy ratings alongside five Holds and two Sells, it’s clear no one path is a clear winner. Worst, Progressive offers a tepid upside potential of just 7.87%, thanks to its average price target of $148.57.
