Progressive: April EPS miss with higher cats, PIF growth deceleration

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Progressive: April EPS miss with higher cats, PIF growth deceleration

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Progressive

April EPS miss with higher cats, PIF

growth deceleration

Reiterate Rating: BUY | PO: 320.00 USD | Price: 202.87 USD

April 2026 operating EPS of $1.31 20 May 2026

The earnings miss was largely based on higher catastrophe loss activity ($496mn pre-tax Equity

vs. our $210mn forecast, a $0.39/sh. headwind). Core expense ratio of 19.4% was in-line

with our low-on-the-Street forecast, supporting our view that expected loss ratio

Key Changesdeterioration will likely be met with notable expense ratio improvement.

(US$) Previous Current

Price Obj. 325.00 320.00PIF count deceleration vs March 2026, below our estimate

A net increase of 125k personal auto customers in April seems like deceleration 2026E EPS 18.75 18.25

(compared with our 246k forecast and 289k in March 2026). This seems weaker than 2027E EPS 18.40 18.15

expected particularly noting these Progressive CEO comments from the 1Q26 earnings 2028E EPS 19.45 19.20

conference call on May 5th: "Historically, there has been a seasonal pop in Q1 and then

the echo in Q3 as policies renew. We’re seeing kind of continued strong shopping as Joshua Shanker

Research Analyst

inflation and affordability for consumers remains tough." We are well aware of this BofAS

seasonality, but management seemed to be suggesting here that it was less pronounced +1 347 821 9017 joshua.shanker@bofa.com

in 2026.

Cyril Onyango

BofASHigher pace of repurchases vs 1Q but below our estimate cyril.onyango@bofa.com

Progressive repurchased $192mn worth of its own stock in April, up from an average of

Fatima Keita

$159mn/month in 1Q26 and is the most spent on repurchases in a month (in dollars) Research Analyst

since August 2007.