Wells Fargo downgrades Progressive with growth turning negative

Wells Fargo downgraded Progressive to Equal Weight from Overweight with a price target of $128, down from $162. The prior Overweight rating was predicted on the thesis that Progressive could grow despite taking price. but its June quarter results “proved us wrong” as direct pay in full growth turned negative month-over-month, the analyst tells investors in a research note. This, combined with “significant” adverse development, supports downgrading the shares, says the firm. It believes Progressive shares “should be stuck (even at these low historical levels)” until reserve actions dissipate.