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The Progressive Corporation (PGR)
:PGR
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Progressive
(NYSE:PGR)
76Outperform
Positive Factors
Financial Performance
PGR's margins have been consistently excellent as inflationary pressures are decelerating, allowing for better-than-expected growth supported by efficient ad spend.
Market Position
Progressive is much better positioned than peers on managing underwriting profit and growth despite current tariffs and inflation uncertainties.
Valuation
The policycount growth at Progressive is expected to be ample to support the current valuation, making any perceived weakness an attractive buying opportunity.
Negative Factors
Competition
GEICO outperformed PGR on both frequency and severity for the second consecutive quarter, indicating increased competitiveness from GEICO.
Growth Projections
Forecasted growth is expected to materially decelerate in the second half of 2025 and beyond, which reduces some underwriting/investment income.
Tariffs Impact
Tariffs may result in rising loss costs and a greater need for pricing adjustments, potentially impacting the loss ratio.
Progressive (PGR) vs. S&P 500 (SPY)
Market Cap
$166.79B
Dividend Yield1.72%
Average Volume (3M)3.29M
Price to Earnings (P/E)19.2
Beta (1Y)0.36
Revenue Growth20.74%
EPS Growth51.73%
CountryUS
Employees66,308
SectorFinancial
Sector Strength87
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)4.01
Shares Outstanding586,223,630
10 Day Avg. Volume2,211,143
30 Day Avg. Volume3,294,183
Financial Highlights & Ratios
PEG Ratio9.11
Price to Book (P/B)42.02
Price to Sales (P/S)0.00
P/FCF Ratio10.60
Enterprise Value/Market Cap1.00
Enterprise Value/Revenue0.57
Enterprise Value/Gross Profit2.87
Enterprise Value/Ebitda4.40
Forecast
1Y Price Target
$302.81Price Target Upside6.43% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering18
Progressive Business Overview & Revenue Model
Company DescriptionProgressive Corporation (PGR) is a major American insurance company headquartered in Mayfield Village, Ohio. Founded in 1937, the company is primarily engaged in providing personal and commercial auto insurance, along with a range of other insurance products such as homeowners, renters, and life insurance. Progressive is well-known for its innovative approach to auto insurance, including usage-based insurance programs and offering a variety of coverage options tailored to individual needs. The company operates through various distribution channels, including direct-to-consumer sales via the internet and phone, as well as through independent insurance agents.
How the Company Makes MoneyProgressive makes money primarily through the underwriting and selling of insurance policies. The company's key revenue streams include premiums collected from policyholders and investment income generated from the reserves held to cover future claims. Progressive's auto insurance segment is the primary driver of revenue, benefiting from its large customer base and competitive pricing strategies. Additionally, the company earns through its diversified portfolio of products, including homeowners and commercial insurance. Significant partnerships with independent agents and financial institutions also facilitate a broader market reach, contributing to its earnings by expanding its customer base and enhancing distribution capabilities. Progressive's focus on technology and data analytics allows it to refine pricing models and reduce claims costs, further supporting its profitability.
Progressive Key Performance Indicators (KPIs)
Any
Net Premiums
Represents the total premiums earned after deducting reinsurance costs, providing insight into revenue generation from core insurance activities.
Represents the total premiums earned after deducting reinsurance costs, providing insight into revenue generation from core insurance activities.
Data provided by:
Main Street Data
Main Street DataProgressive Financial Statement Overview
Summary
Progressive shows strong financial performance with substantial revenue growth, robust cash flow generation, and a stable balance sheet with low leverage. However, there are concerns about margin volatility and liabilities.Income Statement
Progressive has demonstrated strong revenue growth with a significant increase from $38.997 billion in 2019 to $62.082 billion in 2023, a 59.2% growth. The net profit margin improved from 10.18% in 2019 to 6.29% in 2023, despite a dip in 2022. The EBIT and EBITDA margins have been volatile, with a notable improvement in 2023. Overall, the company’s revenue trajectory and profitability indicate strong financial health, although the volatility in margins suggests areas for improvement.82
Very Positive
Balance Sheet
Progressive's balance sheet shows a robust equity base, with stockholders' equity growing from $13.673 billion in 2019 to $20.277 billion in 2023. The debt-to-equity ratio decreased over time, reflecting reduced leverage, which is a positive sign of financial stability. The equity ratio has been stable, indicating a balanced approach towards asset financing. While the low leverage is a strength, the relatively high liabilities to assets ratio could pose a potential risk.75
Positive
Cash Flow
The company's cash flow has been strong with consistent positive free cash flow, peaking at $10.391 billion in 2023, representing a substantial growth from $5.898 billion in 2019. The operating cash flow to net income ratio remains healthy, indicating efficient cash generation relative to earnings. The company’s ability to sustain and grow its free cash flow reinforces its financial resilience.78
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 78.52B | 75.34B | 62.08B | 49.59B | 47.68B | 42.64B | Gross Profit |
| 58.11B | 75.34B | 62.07B | 49.59B | 47.68B | 42.63B | EBIT |
| 7.77B | 10.71B | 5.17B | 922.10M | 4.21B | 7.17B | EBITDA |
| 8.20B | 11.28B | 0.00 | 0.00 | 0.00 | 0.00 | Net Income Common Stockholders |
| 8.72B | 8.48B | 3.90B | 721.50M | 3.35B | 5.70B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 8.57B | 76.09B | 84.90M | 8.95B | 45.00B | 42.11B | Total Assets |
| 88.91B | 105.75B | 88.69B | 70.23B | 71.13B | 64.10B | Total Debt |
| 6.89B | 6.89B | 6.89B | 6.53B | 4.90B | 5.40B | Net Debt |
| 6.72B | 6.75B | 6.80B | 6.30B | 4.71B | 5.32B | Total Liabilities |
| 67.10B | 80.15B | 68.41B | 54.34B | 52.90B | 47.06B | Stockholders Equity |
| 21.81B | 25.59B | 20.28B | 15.89B | 18.23B | 17.04B |
| Cash Flow | Free Cash Flow | ||||
| 15.73B | 14.83B | 10.39B | 6.56B | 7.52B | 6.68B | Operating Cash Flow |
| 16.03B | 15.12B | 10.64B | 6.85B | 7.76B | 6.91B | Investing Cash Flow |
| -12.97B | -13.75B | -10.84B | -7.96B | -3.12B | -6.12B | Financing Cash Flow |
| -3.02B | -1.32B | 78.00M | 1.13B | -4.52B | -938.80M |
Progressive Technical Analysis
Positive
284.51
Price Trends
276.12
Positive
261.92
Positive
251.84
Positive
Market Momentum
3.43
Negative
58.99
Neutral
87.49
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PGR, the sentiment is Positive. The current price of 284.51 is above the 20-day moving average (MA) of 274.87, above the 50-day MA of 276.12, and above the 200-day MA of 251.84, indicating a bullish trend. The MACD of 3.43 indicates Negative momentum. The RSI at 58.99 is Neutral, neither overbought nor oversold. The STOCH value of 87.49 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PGR.
Progressive Risk Analysis
Progressive disclosed 31 risk factors in its most recent earnings report. Progressive reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Progressive Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $27.50B | 16.83 | 20.73% | 0.44% | 11.38% | 14.76% | |
77 Outperform | $115.81B | 13.86 | 13.40% | 1.59% | 9.09% | -7.55% | |
76 Outperform | $166.79B | 19.16 | 34.34% | 1.72% | 20.74% | 51.73% | |
74 Outperform | $53.51B | 13.69 | 19.88% | 1.85% | 11.49% | 219.86% | |
73 Outperform | $23.78B | 13.81 | 10.94% | ― | -6.46% | -26.71% | |
71 Outperform | $61.12B | 14.69 | 16.05% | 1.56% | 9.60% | 36.89% | |
64 Neutral | $12.60B | 9.73 | 7.92% | 16985.68% | 12.21% | -5.61% |
* Financial Sector Average
Performance Comparison
PGR
Progressive
284.51
76.37
36.69%
CB
Chubb
289.88
38.65
15.38%
ALL
Allstate
202.64
36.11
21.68%
MKL
Markel
1,901.24
266.77
16.32%
TRV
Travelers Companies
269.75
56.94
26.76%
WRB
W. R. Berkley Corporation
72.49
21.35
41.75%
Progressive Earnings Call Summary
Earnings Call Date:Apr 16, 2025
(Q1-2025)
| % Change Since: 3.04%|
Next Earnings Date:Jul 10, 2025
Earnings Call Sentiment Neutral
Progressive reported strong growth in personal auto applications and investment income, coupled with sub-90 combined ratios in key segments. However, challenges such as tariffs, competitive pressures, and property market volatility present noteworthy hurdles. While growth remains robust, there is uncertainty regarding the impact of tariffs and increased competition.Q1-2025 Updates
Positive Updates
Record Growth in Personal Auto Applications
The first quarter of 2025 saw personal auto new applications surpass the previous record by over 20%. This growth was driven by more quotes and higher conversion rates, indicating strong price competitiveness.
Strong Investment Income Growth
Progressive's investment portfolio generated investment income that was 32% greater than the first quarter of the previous year, averaging over $270 million a month year-to-date.
Sub-90 Combined Ratios in Key Segments
Personal auto, property, and commercial lines all reported year-to-date combined ratios below 90, a significant achievement amid industry challenges.
Significant Growth in Commercial Lines
Core commercial auto new applications increased by 8% year-over-year, with significant growth in business auto and contractor BMT applications, despite challenges in the trucking space.
Negative Updates
Challenges with Tariffs and Market Uncertainty
The macroeconomic effects of tariffs pose a challenge as their impact on supply chain and loss costs is still uncertain. Progressive is preparing various scenarios to assess potential impacts.
Retention Challenges Amid Competitive Environment
The competitive environment is leading to increased shopping, impacting policy life expectancy and retention rates. The company is working to maintain growth despite these challenges.
Ongoing Challenges in Certain Property Markets
Progressive continues to face challenges in property markets, particularly in Florida and California, where growth is being carefully managed due to volatility and market conditions.
Company Guidance
During Progressive's first-quarter investor call for 2025, CEO Tricia Griffith highlighted the company's strong performance with near-record margins and record growth, driven by a 20% increase in personal auto applications compared to the first quarter of 2023. She emphasized Progressive's efficient customer acquisition process and competitive pricing, supported by a robust advertising strategy that significantly enhanced their market presence. Griffith also noted substantial growth in commercial auto applications, up 8% year-over-year, and progress in the property segment, particularly in less volatile states. The company achieved a year-to-date combined ratio below 90 for its personal auto, property, and commercial lines despite industry challenges. Progressive's investment portfolio generated a 32% increase in investment income, averaging over $270 million monthly. Concerning potential impacts from tariffs, Progressive has been modeling various scenarios to prepare for possible increases in loss costs. Griffith expressed confidence in Progressive's ability to manage challenges, highlighting their historical success during macroeconomic disruptions.Progressive Corporate Events
Executive/Board Changes
Progressive Appoints Carl Joyce as New VP and CAO
Neutral
Mar 10, 2025
On March 7, 2025, Progressive Corporation appointed Carl G. Joyce as the new Vice President and Chief Accounting Officer, succeeding Mariann Wojtkun Marshall. Mr. Joyce, who has been with the company for 13 years and served as Director of Financial Reporting – GAAP for over five years, will receive compensation and benefits aligned with his senior role, potentially impacting the company’s financial leadership and strategic direction.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.