Allstate (ALL) Hits a 52-Week High on Strong Q3 Performance

On Nov 15, the stock of The Allstate Corp. ALL hit a 52-week high of $101.12. This upside is believed to have been driven by strong third-quarter results.
    
In a year’s time, the stock has returned 39.8%, significantly outperforming the 15% growth logged by the industry and 18.1%, by the S&P 500 index.

Investors favorably viewed the company’s impressive performance, which saw the stock beating the Zacks Consensus Estimate by a wide margin of 81.8% on the bottom line, driven by improved auto insurance margins and strong investment results, despite incurring losses of $861 million related to Hurricanes Harvey and Irma.  

The top line also surpassed estimates by 13.1%, thereby cementing investors’ confidence in the company’s ability to grow its premium in a tough and competitive market environment.

The recent quarterly results reflected the company’s success in reaping profits from a number of growth initiatives (such as profit improvement plan in its auto business and efforts to diversify its business and product offerings) taken in last two years. In the recent past, the company suffered from huge claims in its auto business and its overall premium remained under pressure due to low pricing and a competitive market.

Shareholders remain impressed with the company’s financial strength and its commitment to proactively manage the shareholders’ capital. During the third-quarter earnings call, Allstate authorized a new $2 billion share repurchase program.

The company also recently announced a new reporting structure, which will expand its financial reporting segments from four to seven. This change will provide investors with an enhanced transparency and the company’s operating valuation.

Allstate carries a Zacks Rank #3 (Hold). Some better-ranked players in the space are Infinity Property and Casualty Corp. IPCC, The First American Corp. FAF and NMI Holdings Inc. NMIH. While Infinity Property and Casualty and NMI Holdings sport a Zacks Rank #1 (Strong Buy), First American carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Infinity Property and Casualty beat estimates in three of the last four quarters with an average positive surprise of 300.7%.

First American surpassed estimates in each of the trailing four quarters with an average beat of 12.7%.

NMI Holdings third-quarter earnings beat the Zacks Consensus Estimate by 42.9%.

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Allstate Corporation (The) (ALL) : Free Stock Analysis Report
 
First American Corporation (The) (FAF) : Free Stock Analysis Report
 
Infinity Property and Casualty Corporation (IPCC) : Free Stock Analysis Report
 
NMI Holdings Inc (NMIH) : Free Stock Analysis Report
 
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