A month has gone by since the last earnings report for Allstate (ALL). Shares have added about 2.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Allstate 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 most recent earnings report in order to get a better handle on the important catalysts.
Allstate Q4 Earnings Beat on Strong Premium & Investment Income
Allstate reported a fourth-quarter 2024 adjusted net income of $7.67 per share, which outpaced the Zacks Consensus Estimate by 17.8%. The bottom line increased nearly 32% year over year.
Operating revenues advanced 12.1% year over year to $16.71 billion but missed the consensus mark by a whisker.
The strong fourth-quarter earnings benefited from growth in premiums and improved underwriting income and investment income. However, the upside was partly offset by elevated catastrophe losses and increased costs and expenses.
Allstate’s 2024 operating revenues of $64.33 billion increased from $57.39 billion a year ago and marginally beat the estimates. Full-year adjusted net income of $18.32 per share surged from 95 cents a year ago and comfortably beat the consensus estimate of $16.96 per share. Full-year Cat Loss of almost $5 billion declined 11.9% year over year.
Consolidated premiums written of $15.06 billion improved 8.8% year over year.
Net investment income was $833 million, which rose 46.2% year over year, resulting from repositioning into higher-yielding fixed-income securities, growing portfolio and improved performance-based results. The metric surpassed the Zacks Consensus Estimate of $754 million. Both market-based and performance-based investment income witnessed significant jumps in the quarter under review.
Total costs and expenses escalated 8.1% year over year to $14 billion but were lower than our estimate of $14.7 billion. The year-over-year rise was due to increased property and casualty insurance claims and claims expenses, and operating costs and expenses. Catastrophe losses escalated to $410 million from $68 million a year ago.
Allstate’s pretax income was $2.4 billion in the fourth quarter, up from the year-ago figure of $1.8 billion.
As of Dec. 31, 2024, total policies in force were 208.3 million, which grew 7.2% year over year.
The Property-Liability segment’s premiums earned advanced 10.6% year over year to $13.9 billion, attributable to rate hikes. Yet, the metric fell short of the Zacks Consensus Estimate by 0.5%. Underwriting income in the unit amounted to $1.8 billion compared with the prior-year quarter’s figure of $1.3 billion. The underlying combined ratio improved 390 basis points year over year to 83%.
The Protection Services segment recorded revenues of $889 million, which advanced 23.6% year over year, aided by Allstate Protection Plans and Arity businesses. Adjusted net income surged to $50 million from $4 million a year ago.
The Allstate Health and Benefits segment’s premium and contract charges improved 3.2% year over year to $482 million and beat the Zacks Consensus Estimate by 1.6%. Adjusted net income of $35 million dropped 41.7% year over year. The segment included Employer voluntary benefits, Group health and Individual health businesses. Last August, it agreed to sell its Employer voluntary benefits businessto StanCorp Financial for $2 billion. It recently agreed to divest the Group health business as well to Nationwide for $1.25 billion in cash. The Individual health business will either be retained or divested in the coming days.
Allstate exited the fourth quarter with a cash balance of $704 million, which fell from the 2024-end level of $722 million. Total assets of $111.6 billion increased from the $103.4 billion figure at 2024-end.
Debt amounted to $8.09 billion, which inched up from the $7.94 billion figure as of Dec. 31, 2024.
Total equity of $21.4 billion advanced from the 2024-end level of $17.6 billion.
Book value per common share was $72.35 as of Dec. 31, 2025, which climbed 21.8% year over year.
The company expects total Property-Liability policies in force to increase this year as auto insurance policy renewal rates improve and new business continues to grow.
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -27.35% due to these changes.
At this time, Allstate has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
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.
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Allstate has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Allstate belongs to the Zacks Insurance - Property and Casualty industry. Another stock from the same industry, W.R. Berkley (WRB), has gained 1.1% over the past month. More than a month has passed since the company reported results for the quarter ended December 2024.
W.R. Berkley reported revenues of $3.51 billion in the last reported quarter, representing a year-over-year change of +9.2%. EPS of $1.13 for the same period compares with $0.97 a year ago.
For the current quarter, W.R. Berkley is expected to post earnings of $1.07 per share, indicating a change of +2.9% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.4% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for W.R. Berkley. Also, the stock has a VGM Score of C.
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This article originally published on Zacks Investment Research (zacks.com).
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