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Allstate (ALL) Rises 45% in a Year: Evaluating the Road Ahead
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Shares of The Allstate Corporation (ALL - Free Report) have gained 44.5% in the past year compared with the industry’s 19.9% growth. The Finance sector and the S&P 500 composite index rose 18.9% and 23.7%, respectively, in the same time frame. With a market capitalization of $42.3 billion, the average volume of shares traded in the last three months was 1.4 million.
Rate hikes, improved underwriting results in the Property-Liability unit, a well-performing Protection Services business and a solid financial position continue to drive Allstate’s performance.
This property and casualty (P&C) insurer, currently carrying a Zacks Rank #3 (Hold), has a sound surprise history of beating earnings estimates. It beat earnings estimates in three of the trailing four quarters and missed the mark once, the average surprise being 41.88%.
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Can ALL Retain the Momentum?
The Zacks Consensus Estimate for Allstate’s 2024 earnings is pegged at $12.15 per share, which indicates a nearly 13-fold increase from the prior-year figure. The consensus estimate for revenues is $62.8 billion, implying 9.4% growth from the year-ago tally.
The consensus mark for 2025 earnings is $17.40 per share, indicating a 43.2% surge from the 2024 estimate. The consensus estimate for revenues is $67.1 billion, implying 6.8% growth from the 2024 estimate.
Allstate's top line continues to benefit from the steady increase in P&C insurance premiums and a diverse product suite. Property-Liability insurance premiums earned grew 10.9% year over year in the first quarter. Ongoing rate hikes are being implemented to counter inflationary pressures, which in turn, provide an impetus to premiums. Management remains confident about executing further rate increases in its auto insurance business in 2024.
Allstate pursues acquisitions to enhance its capabilities and expand its national footprint. The acquisition of National General continues to be beneficial for the premiums of the Property-Liability segment. The Protection Services unit has seen strong performance due to an expanding product suite and growth in Allstate Protection Plans. Total revenues in the segment advanced 12.2% year over year in the first quarter.
The company invests in technology to strengthen its position as a cost-effective digital insurer. Cost-cutting initiatives have led to improvements in underwriting results and the combined ratio of the Property-Liability unit. In the first quarter, the combined ratio improved 640 basis points year over year to 86.9%. Allstate also divests underperforming businesses, thus reallocating capital to bolster its presence in the personal property-liability market and expand protection solutions.
A solid financial position remains a significant advantage for Allstate, supported by its growing cash reserves and robust cash-generating capabilities. The cash balance increased 17.7% from the 2023-end level as of Mar 31, 2024. This financial strength allows Allstate to return capital to shareholders. In February 2024, management approved a 3.4% increase in the quarterly dividend.
Allstate boasts an impressive VGM Score of B. VGM Score helps identify stocks with the most attractive value, the best growth and the most promising momentum.
Palomar’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 15.10%. The Zacks Consensus Estimate for PLMR’s 2024 earnings indicates an improvement of 26% while the consensus estimate for revenues implies growth of 34.2% from the corresponding year-ago reported figures. The consensus mark for PLMR’s earnings has moved 7.9% north in the past 60 days.
The bottom line of RLI beat estimates in three of the trailing four quarters and missed the mark once, the average surprise being 132.39%. The Zacks Consensus Estimate for RLI’s 2024 earnings indicates an improvement of 18.4% while the consensus estimate for revenues implies growth of 15.6% from the corresponding year-ago reported figures. The consensus mark for RLI’s earnings has moved 1.9% north in the past 60 days.
NMI’s earnings outpaced estimates in each of the last four quarters, the average surprise being 8.60%. The Zacks Consensus Estimate for NMIH’s 2024 earnings indicates an improvement of 10.7% while the consensus estimate for revenues implies growth of 11.1% from the corresponding year-ago reported figures. The consensus mark for NMIH's earnings has moved 4.9% north in the past 60 days.
Shares of Palomar, RLI and NMI have gained 38.9%, 3.3% and 29.9%, respectively, in the past year.
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Allstate (ALL) Rises 45% in a Year: Evaluating the Road Ahead
Shares of The Allstate Corporation (ALL - Free Report) have gained 44.5% in the past year compared with the industry’s 19.9% growth. The Finance sector and the S&P 500 composite index rose 18.9% and 23.7%, respectively, in the same time frame. With a market capitalization of $42.3 billion, the average volume of shares traded in the last three months was 1.4 million.
Rate hikes, improved underwriting results in the Property-Liability unit, a well-performing Protection Services business and a solid financial position continue to drive Allstate’s performance.
This property and casualty (P&C) insurer, currently carrying a Zacks Rank #3 (Hold), has a sound surprise history of beating earnings estimates. It beat earnings estimates in three of the trailing four quarters and missed the mark once, the average surprise being 41.88%.
Image Source: Zacks Investment Research
Can ALL Retain the Momentum?
The Zacks Consensus Estimate for Allstate’s 2024 earnings is pegged at $12.15 per share, which indicates a nearly 13-fold increase from the prior-year figure. The consensus estimate for revenues is $62.8 billion, implying 9.4% growth from the year-ago tally.
The consensus mark for 2025 earnings is $17.40 per share, indicating a 43.2% surge from the 2024 estimate. The consensus estimate for revenues is $67.1 billion, implying 6.8% growth from the 2024 estimate.
Allstate's top line continues to benefit from the steady increase in P&C insurance premiums and a diverse product suite. Property-Liability insurance premiums earned grew 10.9% year over year in the first quarter. Ongoing rate hikes are being implemented to counter inflationary pressures, which in turn, provide an impetus to premiums. Management remains confident about executing further rate increases in its auto insurance business in 2024.
Allstate pursues acquisitions to enhance its capabilities and expand its national footprint. The acquisition of National General continues to be beneficial for the premiums of the Property-Liability segment. The Protection Services unit has seen strong performance due to an expanding product suite and growth in Allstate Protection Plans. Total revenues in the segment advanced 12.2% year over year in the first quarter.
The company invests in technology to strengthen its position as a cost-effective digital insurer. Cost-cutting initiatives have led to improvements in underwriting results and the combined ratio of the Property-Liability unit. In the first quarter, the combined ratio improved 640 basis points year over year to 86.9%. Allstate also divests underperforming businesses, thus reallocating capital to bolster its presence in the personal property-liability market and expand protection solutions.
A solid financial position remains a significant advantage for Allstate, supported by its growing cash reserves and robust cash-generating capabilities. The cash balance increased 17.7% from the 2023-end level as of Mar 31, 2024. This financial strength allows Allstate to return capital to shareholders. In February 2024, management approved a 3.4% increase in the quarterly dividend.
Allstate boasts an impressive VGM Score of B. VGM Score helps identify stocks with the most attractive value, the best growth and the most promising momentum.
Stocks to Consider
Some better-ranked stocks in the P&C insurance space are Palomar Holdings, Inc. (PLMR - Free Report) , RLI Corp. (RLI - Free Report) and NMI Holdings, Inc. (NMIH - Free Report) . While Palomar sports a Zacks Rank #1 (Strong Buy), RLI and NMI carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Palomar’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 15.10%. The Zacks Consensus Estimate for PLMR’s 2024 earnings indicates an improvement of 26% while the consensus estimate for revenues implies growth of 34.2% from the corresponding year-ago reported figures. The consensus mark for PLMR’s earnings has moved 7.9% north in the past 60 days.
The bottom line of RLI beat estimates in three of the trailing four quarters and missed the mark once, the average surprise being 132.39%. The Zacks Consensus Estimate for RLI’s 2024 earnings indicates an improvement of 18.4% while the consensus estimate for revenues implies growth of 15.6% from the corresponding year-ago reported figures. The consensus mark for RLI’s earnings has moved 1.9% north in the past 60 days.
NMI’s earnings outpaced estimates in each of the last four quarters, the average surprise being 8.60%. The Zacks Consensus Estimate for NMIH’s 2024 earnings indicates an improvement of 10.7% while the consensus estimate for revenues implies growth of 11.1% from the corresponding year-ago reported figures. The consensus mark for NMIH's earnings has moved 4.9% north in the past 60 days.
Shares of Palomar, RLI and NMI have gained 38.9%, 3.3% and 29.9%, respectively, in the past year.