It has been about a month since the last earnings report for Progressive (PGR). Shares have added about 1.5% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Progressive due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.
Progressive's Q2 Earnings and Revenues Beat on Higher Premiums
The Progressive Corporation’s second-quarter 2025 earnings per share of $4.88 beat the Zacks Consensus Estimate by 10.1%. The bottom line increased 84.1% year over year.
Behind the Headlines
Net premiums written were $20 billion in the quarter, up 12% from $17.9 billion a year ago. Net premiums earned grew 18% to $20.3 billion. The reported figure surpassed the Zacks Consensus Estimate of $20.1 billion.
Operating revenues increased 19.5% year over year to $42.2 billion, driven by 19% higher net premiums earned, a 29.3% increase in net investment income, an 18.9% rise in fees and 28% higher service revenues. The top line beat the Zacks Consensus Estimate by 96.4%.
Total expenses increased 15.1% to $35.2 billion, attributable to 12% higher losses and loss adjustment expenses, a 17% increase in policy acquisition costs, a 31.5% surge in other underwriting expenses, and a 23.6% rise in service expenses.
Net realized gain on securities was $387 million versus a loss of $127 million in the year-ago quarter. Combined ratio — the percentage of premiums paid out as claims and expenses — improved 570 basis points (bps) from the prior-year quarter’s level to 86.2.
June Policies in Force
Policies in force were solid in the Personal Lines segment, increasing 16% from the year-ago month’s figure to 36.1 million. Special Lines improved 9% to 6.8 million. In the Personal Auto segment, Agency Auto increased 16% year over year to 10.4 million, while Direct Auto jumped 21% to 15.2 million.
Progressive’s Commercial Auto segment policies rose 6% year over year to 1.2 million. The Property business had 3.6 million policies in force, up 8%.
Financial Update
Progressive’s book value per share was $55.62 as of June 30, 2025, up 39.5% from $39.85 as of June 30, 2024. Return on equity in June 2025 was 43.6%, up from 40.2% reported in the year-ago period. The total debt-to-total capital ratio improved 530 bps to 17.5.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in fresh estimates.
VGM Scores
At this time, Progressive has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock has a grade of B on the value side, putting it in the top 40% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Progressive has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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The Progressive Corporation (PGR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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