We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. By pressing "Accept All" or closing out of this banner, you accept our Privacy Policy and Terms of Service, revised from time to time, and you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties. You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Allstate (ALL) Down 4.2% Since Last Earnings Report: Can It Rebound?
Read MoreHide Full Article
A month has gone by since the last earnings report for Allstate (ALL - Free Report) . Shares have lost about 4.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Allstate due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Allstate's Q1 Loss Narrower Than Expected, Revenues Rise
Allstate incurred a first-quarter 2023 adjusted loss of $1.30 per share, narrower than the Zacks Consensus Estimate of a loss of $1.94 per share. Notably, earnings of $2.59 per share were reported in the prior-year quarter.
The quarterly results took a hit from significant catastrophe losses, escalating expenses and lower contributions from the Protection Services, and Health and Benefits segments.
ALL’s operating revenues increased 9.3% year over year to $13,772 million in the quarter under review. The top line outpaced the consensus mark by 7.4%. This was mainly due to rate increases in auto and home insurance leading to 10.8% year-over-year growth in property and casualty (P&C) insurance premiums.
Q1 Operations
Net investment income of $575 million fell 3.2% year over year due to a significant plunge of 58.8% in performance-based investment income. The figure, however, surpassed our estimate of $501.9 million. Market-based investment income soared 57% year over year in the first quarter.
Total costs and expenses of $14,192 million escalated 23% year over year mainly due to higher P&C insurance claims and claim expenses, and the amortization of deferred policy acquisition costs.
Allstate incurred a pretax loss of $406 million in the quarter under review against the prior-year quarter’s pretax income of $801 million.
Total policies in force fell 1.9% year over year to 186.7 million as of Mar 31, 2023.
ALL’s catastrophe losses were $1,691 million, which increased nearly four-fold year over year.
Segmental Performances
The Property-Liability segment’s premiums grew 10.8% year over year to $11,635 million in the first quarter, thanks to higher average premiums from Allstate and National General brands. The reported figure beat the Zacks Consensus Estimate of $11,508 million.
The segment incurred an underwriting loss of $1,001 million against the prior-year quarter’s underwriting income of $280 million. The underwriting loss stemmed from an elevated catastrophe loss level. The underlying combined ratio of 93.3% deteriorated 240 basis points (bps) year over year in the quarter under review.
The Protection Services segment reported revenues of $671 million, which rose 7% year over year in the first quarter on the back of higher revenues derived from Allstate Protection Plans and Allstate Dealer Services. Adjusted net income dropped 19% year over year to $34 million, lower than the consensus mark of $46.2 million and our estimate of $42 million.
The Allstate Health and Benefits segment’s total premium and contract charges of $463 million dipped 1.1% year over year in the quarter under review but outpaced the Zacks Consensus Estimate of $460 million. Softness in individual health and employer voluntary benefits exerted a strain on the metric. Adjusted net income of $56 million slid 1.8% year over year and matched the consensus mark.
Financial Update (as of Mar 31, 2023)
Allstate exited the first quarter with a cash balance of $662 million, which tumbled 10.1% from the 2022-end level. Total assets of $99.6 billion increased 1.7% from the figure at 2022 end.
Debt amounted to $8,452 million, up 6.1% from the figure as of Dec 31, 2022. Total shareholders’ equity of $17,494 million inched up marginally from the 2022-end level.
Book value per common share came in at $58.65, which plunged 22.3% year over year.
The adjusted net income return on equity in the trailing 12-month period came in at a negative figure of 6.7%. The metric was recorded at 13% in the prior-year quarter.
Capital Deployment
In the reported quarter, Allstate rewarded its shareholders with $377 million, which included share buybacks worth $153 million and dividends of $224 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Allstate (ALL) Down 4.2% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Allstate (ALL - Free Report) . Shares have lost about 4.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Allstate due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Allstate's Q1 Loss Narrower Than Expected, Revenues Rise
Allstate incurred a first-quarter 2023 adjusted loss of $1.30 per share, narrower than the Zacks Consensus Estimate of a loss of $1.94 per share. Notably, earnings of $2.59 per share were reported in the prior-year quarter.
The quarterly results took a hit from significant catastrophe losses, escalating expenses and lower contributions from the Protection Services, and Health and Benefits segments.
ALL’s operating revenues increased 9.3% year over year to $13,772 million in the quarter under review. The top line outpaced the consensus mark by 7.4%. This was mainly due to rate increases in auto and home insurance leading to 10.8% year-over-year growth in property and casualty (P&C) insurance premiums.
Q1 Operations
Net investment income of $575 million fell 3.2% year over year due to a significant plunge of 58.8% in performance-based investment income. The figure, however, surpassed our estimate of $501.9 million. Market-based investment income soared 57% year over year in the first quarter.
Total costs and expenses of $14,192 million escalated 23% year over year mainly due to higher P&C insurance claims and claim expenses, and the amortization of deferred policy acquisition costs.
Allstate incurred a pretax loss of $406 million in the quarter under review against the prior-year quarter’s pretax income of $801 million.
Total policies in force fell 1.9% year over year to 186.7 million as of Mar 31, 2023.
ALL’s catastrophe losses were $1,691 million, which increased nearly four-fold year over year.
Segmental Performances
The Property-Liability segment’s premiums grew 10.8% year over year to $11,635 million in the first quarter, thanks to higher average premiums from Allstate and National General brands. The reported figure beat the Zacks Consensus Estimate of $11,508 million.
The segment incurred an underwriting loss of $1,001 million against the prior-year quarter’s underwriting income of $280 million. The underwriting loss stemmed from an elevated catastrophe loss level. The underlying combined ratio of 93.3% deteriorated 240 basis points (bps) year over year in the quarter under review.
The Protection Services segment reported revenues of $671 million, which rose 7% year over year in the first quarter on the back of higher revenues derived from Allstate Protection Plans and Allstate Dealer Services. Adjusted net income dropped 19% year over year to $34 million, lower than the consensus mark of $46.2 million and our estimate of $42 million.
The Allstate Health and Benefits segment’s total premium and contract charges of $463 million dipped 1.1% year over year in the quarter under review but outpaced the Zacks Consensus Estimate of $460 million. Softness in individual health and employer voluntary benefits exerted a strain on the metric. Adjusted net income of $56 million slid 1.8% year over year and matched the consensus mark.
Financial Update (as of Mar 31, 2023)
Allstate exited the first quarter with a cash balance of $662 million, which tumbled 10.1% from the 2022-end level. Total assets of $99.6 billion increased 1.7% from the figure at 2022 end.
Debt amounted to $8,452 million, up 6.1% from the figure as of Dec 31, 2022. Total shareholders’ equity of $17,494 million inched up marginally from the 2022-end level.
Book value per common share came in at $58.65, which plunged 22.3% year over year.
The adjusted net income return on equity in the trailing 12-month period came in at a negative figure of 6.7%. The metric was recorded at 13% in the prior-year quarter.
Capital Deployment
In the reported quarter, Allstate rewarded its shareholders with $377 million, which included share buybacks worth $153 million and dividends of $224 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.