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Progressive Corp PGR

Rating as of

Morningstar’s Analysis

Valuation
Currency in USD
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Signs of Normalization in Progressive's Fourth Quarter

Brett Horn, CFA Senior Equity Analyst

Analyst Note

| Brett Horn, CFA |

2020 was a very strong year for Progressive, which benefited from a pandemic-induced reduction in miles driven and claims. While the narrow-moat franchise has historically earned strong returns, the 36% return on equity for the year was well above its historical results. However, there are signs in the company’s fourth-quarter results that conditions are starting to normalize. We will maintain our $70 fair value estimate.

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Company Profile

Business Description

Progressive underwrites private and commercial auto insurance and specialty lines; it has almost 20 million personal auto policies in force and is the fourth- largest auto insurer in the United States. Progressive markets its policies through independent insurance agencies in the U.S. and Canada and directly via the Internet and telephone. Its premiums are split roughly equally between the agent and the direct channel. The company also offers commercial auto policies and entered homeowners insurance through an acquisition in 2015.

Contact
6300 Wilson Mills Road
Mayfield Village, OH, 44143
T +1 440 461-5000
Sector Financial Services
Industry Insurance - Property & Casualty
Most Recent Earnings Sep 30, 2020
Fiscal Year End Dec 31, 2020
Stock Type High Yield
Employees 41,571

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