This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Allstate CEO Shrugs Off Sandy

Stocks in this article: ALL

Much of the damage from Hurricane Sandy is from flooding, and although Allstate will be adjusting flood claims, the claims will be paid by the federal government, through the National Flood Insurance Program. Deutsche Bank analyst Joshua Shanker on Wednesday wrote that "An Allstate loss of less than $500mm for Sandy may be seen as a triumph."

Shanker rates Allstate a "Buy" with a price target of $47, and estimates the company will earn $4.80 a share in 2013. The analyst said that "by our estimates core homeowners' margins have improved by almost 200bps and 700bps over sequential quarters and annually, respectively," and that "core auto margins improved modestly as well. We believe consensus number need to rise to reflect underlying improved margins."

KBW analyst Cliff Gallant has a "Market Perform" rating on Allstate, and on Wednesday cut his 2012 EPS estimate to $4.35 from $4.60 "due to Sandy," but raised his 2013 EPS estimate to $4.80 from $4.65, "on good underlying trends." Gallant also raised his price target for the shares by five dollars, to $42, "in-line with book." Allstate's book value per share increased to $42.64 as of Sept. 30, from $34.84 a year earlier.

Gallant said that for the third quarter, Allstate's "underwriting results were ahead of our expectations, with a lower-than-expected combined ratio (90.2% versus our 94.3% estimate) and better premium growth (5.0% versus our 3.5% estimate)," was "primarily due to the company's recent acquisition of Esurance, which added $282 million of new written premiums , and an increase in Homeowners premiums."

Allstate closed at $39.98 Wednesday, returning 49% year-to-date. The shares trade for nine times the consensus 2013 EPS estimate of $4.45.

ALL Chart ALL data by YCharts

Interested in more on Allstate? See TheStreet Ratings' report card for this stock.

-- Written by Philip van Doorn in Jupiter, Fla.

>Contact by Email.

Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.
2 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs