NEW YORK (TheStreet) -- All those commercials for Progressive insurance must be working. Progressive Corp. (PGR) - Get Report broke out to the upside in June, and has continued up, to break out over its 2005 highs.
Everything appears to be in alignment in the chart above. Prices are above the rising 50-day and 200-day moving averages. The On-Balance-Volume (OBV) broke out to the upside with prices. PGR is a little extended, so traders should probably look to buy a dip below $32.50 or so and a sell-stop below $30.
In the long-term chart of PGR above, we can see prices have broken above the 2005 peak. Impressive.
TheStreet Ratings team rates PROGRESSIVE CORP-OHIO as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
We rate PROGRESSIVE CORP-OHIO (PGR) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, notable return on equity and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company shows low profit margins.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 13.3%. Since the same quarter one year prior, revenues rose by 10.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Compared to its closing price of one year ago, PGR's share price has jumped by 30.42%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, PGR should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Insurance industry and the overall market, PROGRESSIVE CORP-OHIO's return on equity exceeds that of both the industry average and the S&P 500.
- Despite currently having a low debt-to-equity ratio of 0.36, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further.
- The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and the Insurance industry average. The net income has decreased by 6.0% when compared to the same quarter one year ago, dropping from $296.10 million to $278.30 million.
- You can view the full analysis from the report here: PGR