Keefe Bruyette cuts Progressive stock price target on earnings outlook

Keefe, Bruyette & Woods has reduced its price target on Progressive Corp. shares to $246 from $252. The firm has maintained an Outperform rating on the stock. The revised earnings estimates for Progressive for 2026, 2027, and 2028 are $18.30, $16.35, and $16.40, respectively. These estimates incorporate Progressive's September 2026 results and assume slower premium growth and higher core loss and expense ratios.

The new price target represents 15.0 times the firm's 2027 earnings estimate or 16.5 times normalized for a 93% combined ratio. The stock is currently trading at a P/E ratio of 10.69, which InvestingPro analysis suggests is undervalued. Despite these reductions, 17 analysts have recently revised their earnings estimates upwards, providing insights into Progressive's outlook.

Keefe, Bruyette & Woods anticipates stabilizing personal auto policies in force with year-over-year growth in the near term beyond September's unfavorable seasonality. The firm expects solidly profitable growth in Progressive's Property and Commercial segments. Progressive Corp. is scheduled to release its earnings report on October 14, with an anticipated 3% stock movement based on options data.

Other firms, including Wells Fargo, BMO Capital, UBS, and Raymond James, have varying ratings and price targets for Progressive, reflecting differing perspectives on the company's future.