For Immediate Release
Chicago, IL – November 12, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Progressive Corporation (PGR), Allstate Corp. (ALL), Infinity Property and Casualty Corp. (IPCC), State Auto Financial Corp. (STFC) and Monsanto Company (MON).
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Here are highlights from Wednesday’s Analyst Blog:
Progressive’s Income Falls
Auto insurer Progressive Corporation’s (PGR) income for October fell to 16 cents per share compared with 22 cents in the year-ago period. Though the company has posted a growth in premium writings, realized gains were lower in the quarter compared to the year-ago quarter.
The company, which reports earnings on a monthly basis, disclosed an income of $106.7 million, down from $145.0 million in the prior-year period.
Progressive’s net premiums written increased 3% year-over-year to $1.3 billion. The company recorded a pre-tax investment gain of $20.0 million, compared with $88.4 million in the year-ago quarter. Combined ratio, which reflects the percentage of premiums paid out as claims and expenses, improved to 91.6% from 93.2% recorded in the year-ago period.
Policies in force (PIF) were good in Personal Auto and Special Lines, which were up 5% and 3% year-over-year, respectively. In Personal Auto, Direct Auto reported a 13% growth in PIF while Agency Auto was flat year-over-year.
However, growth remains a challenge at Progressive’s Commercial Auto business, which was down 5% year-over-year. This line continues to be negatively impacted by the downturn in the economy, primarily in the housing and construction sectors. Combined with this, increased competition has added to its woes.
Progressive’s recurring pre-tax investment yield was 3.7% year-to-date, versus 4.8% reported in the year-ago comparable period. Reported book value was $8.34 per share at Oct 31, 2009, up from $8.13 at Sep 30, 2009, and $7.24 at June 30, 2009. Return on equity on a trailing 12-month basis was 18.7%. During October, Progressive repurchased 2.3 million shares at an average price of $16.38.
As of Oct 31, 2009, Progressive has invested 18% of its portfolio in Group I securities that include common equities, redeemable and non-redeemable preferred stocks, and non-investment-grade and non-rated fixed-maturity securities. In early November, approximately $300 million of its securities were reallocated into common equities.
Like Progressive, other auto insurance providers such as Allstate Corp. (ALL), Infinity Property and Casualty Corp. (IPCC) and State Auto Financial Corp. (STFC) have experienced the severe impact of the weak economy, which has significantly hampered consumers' confidence and their ability to purchase auto insurance policies. Additionally, the U.S. auto insurance industry has been subject to unusually high expenses due to fraudulent activities.
Monsanto Confirms Guidance
At its investor conference call, Monsanto Company (MON) indicated that it will accelerate launches for its Genuity SmartStax corn and Genuity Roundup Ready 2 Yield soybean products. The company emphasized its growth strategy from 2010 through 2012, which includes three operational imperatives: the conversion to Genuity SmartStax in U.S. corn, the upgradation to the Genuity Roundup Ready 2 Yield platform in U.S. soybeans, and increased penetration in Latin America.
Monsanto now anticipates its new Genuity SmartStax corn seed will launch on more than 4 million acres in 2010, compared to its previous expectation of 3 million to 4 million acres. As a part of the accelerated adoption of Genuity SmartStax, the company unveiled a new portfolio of product upgrades for key U.S. corn segments.
For the Genuity Roundup Ready 2 Yield platform in U.S. soybeans, Monsanto increased its launch-year expectation for 2010 to 8 - 10 million acres, compared to its previous projection of 7 - 8 million.
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