May 2026 Results: Strong Underwriting Results Address Key Bearish Thesis

Research evidence excerpt

May 2026 Results: Strong Underwriting Results Address Key Bearish Thesis

Update

June 17, 2026 01:21 PM GMT

Morgan Stanley & Co. LLCMThe Progressive Corp. | North America Bob Jian Huang

Equity Analyst

May 2026 Results: Strong Bob.Huang@morganstanley.comDaniel Lee, ACAS +1 212 761-6136

Research Associate

Daniel.Lee4@morganstanley.com +1 212 761-0219

Underwriting Results Address Siddhant Shah

Sid.Shah@morganstanley.com +1 212 761-2603

Key Bearish Thesis

The Progressive Corp. (PGR.N, PGR US)

Insurance - Property & Casualty | United States of

Reaction to earnings America

Weakens our thesis Modest upside Modest revision higher Stock Rating Underweight

Impact to our thesis Financial results versus consensus Direction of next 12-month Industry View Attractive

consensus EPS Price target $190.00

Shr price, close (Jun 16, 2026) $204.66

Source: Company data, Morgan Stanley Research Mkt cap, curr (mm) $119,862

52-Week Range $269.66-189.31

Solid earnings pushing towards a steadier summer. Solid core loss ratio and

favorable PYD supported an impressive ~82% total company combined ratio. While

PIF growth continues to decelerate YoY at 134K adds for personal auto, it came in

better than our expectations. The results addressed variety of uncertainties in the

investment thesis for the stock. The bear thesis was based upon deterioration of

combined ratio and growth slowdown in a soft market. The results year to date are

indicating that Progressive can navigate this trend fairly gracefully. Further, the May

results indicated that underwriting deterioration and growth slowdown are not

certain in the current soft market. If the company can chart a path to stable

underwriting profit, we would expect the valuation to rebound.

May 2026 - Op.