Progressive (PGR) AI Stock Analysis

• Market Cap: $142.81B
• Dividend Yield: 2.02%
• Average Volume (3M): 2.67M
• Price to Earnings (P/E): 13.8
• Beta (1Y): 0.50
• Revenue Growth: 21.50%
• EPS Growth: 51.86%
• Country: US
• Employees: 66,308
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Property & Casualty
• EPS (TTM): 4.88
• Shares Outstanding: 586,208,500
• 10 Day Avg. Volume: 2,394,966
• 30 Day Avg. Volume: 2,671,311
• PEG Ratio: 0.14
• Price to Book (P/B): 5.48
• Price to Sales (P/S): 1.86
• P/FCF Ratio: 9.46
• Enterprise Value/Market Cap: 1.15
• Enterprise Value/Revenue: 1.99
• Enterprise Value/Gross Profit: 1.99
• Enterprise Value/Ebitda: 11.95
• 1Y Price Target: $280.06
• Price Target Upside: 14.96% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 19

• Rating: 78 Outperform
• Price Target: $280.00 ▲(14.94% Upside)

Progressive's strong financial performance and positive earnings call sentiment are the most significant factors driving the score. The company's robust growth in premiums and market share, along with effective marketing strategies, contribute positively. However, technical indicators suggest a neutral short-term trend, and potential risks from tariffs and policy life expectancy declines are noted.

Positive Factors

Market Share Growth

Progressive's significant market share gain in personal auto insurance demonstrates its competitive edge and ability to attract new customers, which is crucial for long-term sustainability and growth.

Strong Profitability

High profitability margins indicate efficient operations and the ability to generate significant income relative to expenses, supporting ongoing investment in growth and innovation.

Effective Marketing Strategy

Substantial investment in marketing has driven double-digit growth in new applications, indicating successful customer acquisition strategies that enhance long-term revenue potential.

Negative Factors

Policy Life Expectancy Decline

A decline in policy life expectancy can impact long-term revenue stability, as shorter policy durations may lead to increased churn and higher customer acquisition costs.

Potential Florida Refund

Refund obligations due to excess profitability in Florida could reduce financial flexibility and impact profit margins, posing a risk to future earnings.

Tariff Impact on Pricing

Tariff-related pricing uncertainties could lead to volatility in cost structures and pricing strategies, affecting long-term profitability and competitive positioning.

Progressive Business Overview & Revenue Model

Company Description

The Progressive Corporation, an insurance holding company, provides personal and commercial auto, personal residential and commercial property, general liability, and other specialty property-casualty insurance products and related services in the United States. It operates in three segments: Personal Lines, Commercial Lines, and Property. The Personal Lines segment writes insurance for personal autos and recreational vehicles (RV). This segment's products include personal auto insurance; and special lines products, including insurance for motorcycles, ATVs, RVs, watercrafts, snowmobiles, and related products. The Commercial Lines segment provides auto-related primary liability and physical damage insurance, and business-related general liability and property insurance for autos, vans, pick-up trucks, and dump trucks used by small businesses; tractors, trailers, and straight trucks primarily used by regional general freight and expeditor-type businesses, and long-haul operators; dump trucks, log trucks, and garbage trucks used by dirt, sand and gravel, logging, and coal-type businesses; and tow trucks and wreckers used in towing services and gas/service station businesses; as well as non-fleet and airport taxis, and black-car services. The Property segment writes residential property insurance for homeowners, other property owners, and renters, as well as offers personal umbrella insurance, and primary and excess flood insurance. The company also offers policy issuance and claims adjusting services; and acts as an agent to homeowner general liability, workers' compensation insurance, and other products. In addition, it provides reinsurance services. The company sells its products through independent insurance agencies, as well as directly on Internet through mobile devices, and over the phone. The Progressive Corporation was founded in 1937 and is headquartered in Mayfield, Ohio.

How the Company Makes Money

Progressive generates revenue primarily through the sale of insurance premiums. The company collects premiums from policyholders, which serve as the main source of income. These premiums are determined based on factors such as the insured's driving history, vehicle type, and other risk factors. Progressive also earns investment income by investing the premiums it collects until claims are paid out. Additionally, the company has established partnerships with various agents and brokers, enhancing its distribution channels. Other revenue streams may include fees for additional services and products, as well as proceeds from reinsurance arrangements. Overall, Progressive's ability to leverage technology for pricing, claims processing, and customer engagement contributes significantly to its profitability.

Progressive Financial Statement Overview

Summary

Progressive demonstrates strong financial performance with robust revenue growth, high profitability, and efficient cash flow management. The balance sheet is solid with low leverage and high return on equity, although there have been some fluctuations in equity ratios.

Income Statement

Progressive shows strong revenue growth with a TTM (Trailing-Twelve-Months) revenue increase of 4.93% and a consistent upward trajectory over the past years. The company maintains high profitability with a gross profit margin of 81.65% and a net profit margin of 12.66% in the TTM. EBIT and EBITDA margins are also robust at 16.28% and 16.64%, respectively, indicating efficient operations. However, the net profit margin has shown some volatility in previous years.

Balance Sheet

The balance sheet reflects a solid financial position with a debt-to-equity ratio of 0.21 in the TTM, indicating low leverage. Return on equity is impressive at 36.50%, showcasing strong profitability relative to shareholder equity. The equity ratio stands at 28.23%, suggesting a stable capital structure. However, the company has experienced fluctuations in equity ratios over the years.

Cash Flow

Progressive's cash flow is strong, with a TTM free cash flow growth rate of 4.70%. The free cash flow to net income ratio is high at 98.05%, indicating efficient cash conversion. Operating cash flow to net income ratio is not available, but the consistent growth in free cash flow suggests effective cash management. The company has shown resilience in maintaining positive cash flow growth despite industry challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	82.38B	75.34B	62.08B	49.59B	47.68B	42.64B
Gross Profit	82.38B	75.34B	62.08B	49.59B	47.68B	42.64B
EBITDA	13.71B	11.28B	5.46B	1.47B	4.77B	7.72B
Net Income	10.43B	8.48B	3.90B	722.00M	3.35B	5.70B
Balance Sheet
Total Assets	115.48B	105.75B	88.69B	75.47B	71.13B	64.10B
Cash, Cash Equivalents and Short-Term Investments	10.78B	76.09B	62.25B	49.72B	45.00B	42.11B
Total Debt	6.89B	6.89B	6.89B	6.39B	4.90B	5.40B
Total Liabilities	82.88B	80.15B	68.41B	59.57B	52.90B	47.06B
Stockholders Equity	32.60B	25.59B	20.28B	15.89B	18.23B	17.04B
Cash Flow
Free Cash Flow	16.47B	14.83B	10.39B	6.56B	7.52B	6.68B
Operating Cash Flow	16.80B	15.12B	10.64B	6.85B	7.76B	6.91B
Investing Cash Flow	-13.74B	-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

• Technical Analysis Sentiment: Negative
• Last Price: 243.61
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PGR, the sentiment is Negative. The current price of 243.61 is below the 20-day moving average (MA) of 246.56, below the 50-day MA of 246.15, and below the 200-day MA of 259.34, indicating a bearish trend. The MACD of -0.69 indicates Positive momentum. The RSI at 44.38 is Neutral, neither overbought nor oversold. The STOCH value of 49.52 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PGR.

Progressive Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TRV	81 Outperform	61.92B	12.03	17.77%	1.56%	8.54%	43.51%
CB	80 Outperform	108.54B	12.00	13.25%	1.38%	6.74%	-4.05%
PGR	78 Outperform	$142.81B	13.79	37.29%	2.02%	21.50%	51.86%
WRB	77 Outperform	27.73B	16.26	18.94%	2.16%	11.41%	15.32%
ALL	75 Outperform	51.98B	9.23	24.24%	1.99%	9.81%	94.71%
MKL	68 Neutral	24.39B	11.56	16.24%	―	1.66%	8.51%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%