BofA raised the firm’s price target on Progressive to $197 from $188 and keeps a Buy rating on the shares. The company’s 10-Q filed yesterday described a rising loss severity trend, an ambition to file for more rate increases and a willingness to right-size marketing to maintain margins and the shares sold off on shorter-term margin concerns. However, BofA contends that "investors have seen this story before," argues that higher prices likely lead to stronger growth and believes the selloff was due to "a fundamental misreading of what it means for the company."
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Published first on TheFly
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