Insider Concerns Just Created a Buying Opportunity in The Progressive Corporation (PGR)

On 14 March, shares of The Progressive Corporation (NYSE:PGR) closed higher after a volatile session. The shares accumulated 0.54 points or 0.75 percent at $72.86 with a light trade volume of 2.223 million shares. After opening the session at $72.31, the shares went as high as $73.009 and as low as $71.95, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $42.5 billion and now has 583.49 million shares outstanding. The Progressive Corporation (PGR) stock has gained 5.14 percent of market value in 21 trading days.

PGR stock has a trailing 3-year beta of 0.76, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $4.43 a share in the trailing twelve months. The stock’s value has surged 20.77 percent year to date (YTD) against a rise of 21.41 percent in 12 month’s time. The company’s shares still trade -1.24 percent away from its 1-year high of $73.78 and 28.48 percent up from 52-week low of $56.71. The average consensus rating on the company is 2, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.

The Progressive Corporation (PGR) will probably climb 6.29 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $85-month high price target. This represents a whopping 16.66 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $79, which represents a return potential of 8.43 percent when compared to the closing price of the stock of $72.86 on Thursday, March 14. The lowest price target for the stock is $58 — slightly more than -20.4 percent from PGR’s current share price.

History has shown that shares in The Progressive Corporation have gone up on 19 different earnings reaction days and are predicted to add 0.01 percent when the company reports upcoming earnings. Investors will get their next glimpse of PGR’s Q1 earnings on April 10. Analysts are forecasting revenue to climb 15.2 percent to $9.18B in the fiscal first quarter, while earnings are seen soaring by nearly 6.2 percent to $1.37 per share. It earned $1.24 per share, better than the $1.01, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $7.94B, better than the $7.88B analysts expected. Earnings are estimated to increase by 73.5 percent this year, 6.31 percent next year and continue to increase by 15.31 percent annually for the next 5 years.

The stock is currently hovering around the first support level of $72.2. Below this, the next support is placed in the zone of $71.55. Till the time, the PGR stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 65.63 on daily chart, which may remain a cause for concern. If the price breaks below $71.55 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $73.26 mark may result into a pull-back move towards $73.67 level.

Shares of The Progressive Corporation (PGR) are trading at a P/E ratio of 20.93 times earnings reported for the past 12 months. The industry PGR operates in has an average P/E of 11.01. Its P/E ratio went as low as 12.53X and as high as 20.14 over the 5-year span.Further, it is sporting a 1.33 on the Price-to-Sales ratio. Compare this with the industry average P/S of 0.65.