Progressive: A Slow Fade

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Progressive, the insurer. They sell promises against the inevitable crunch of metal. For a long time, they did it rather well. But things change. They always do. The stock price, you see, has been drifting downward for a good while now. A slow leak, really. It had a little bounce late last year, a hopeful twitch. But hope, as anyone who’s lived a bit knows, is a notoriously unreliable fuel. It sank again. And continues to sink. So it goes.

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There are reasons, of course. Always reasons. Investors, those skittish creatures, have started to lose faith. It’s not a sudden panic, more of a quiet exodus. They’re selling, not shouting. They’re deciding their money might be better spent on something…less likely to be totaled. Which, when you think about it, is everything.

Progressive and the Inexorable Decline

Over the past year, the stock is down about 14 percent. The S&P 500, meanwhile, is up nearly 20. A difference, you might say, of optimism and…well, reality. It’s not a mystery, this downturn. It’s just…business. The universe, in its infinite indifference, doesn’t care much about quarterly earnings.

They used to grow faster, you know. Progressive, that is. At the start of 2025, premiums were up 18 percent. A good number. Then 22 percent. Impressive. Now? November’s numbers showed only 11 and 14 percent growth. A slowdown. A deceleration. Like a car coasting downhill, losing momentum. The inevitable happens, eventually.

Competition is getting tighter, squeezing their margins. And fixing cars these days? Forget about it. Everything’s got a computer in it now. A dent used to be a dent. Now it’s a system failure. Analysts predict earnings will fall by over 10 percent next year. A prediction, of course. But a reasonable one. So it goes.

Cheaper, But Still…

The stock is cheaper now, naturally. Trading at just under 13 times forward earnings. Sounds good, doesn’t it? But compared to the whole market? Not exactly a steal. Mercury General is about the same. Allstate? They’re practically giving it away. Single-digit price-to-earnings ratios. A bargain basement. Progressive isn’t quite there yet.

They pay a dividend, a small one – 10 cents a share each quarter. And sometimes, a special dividend. A big one, like $13.75 a share. But not every year. Sometimes there’s nothing. A little treat, then…nothing. Buying the dip, as they say, hasn’t been a particularly rewarding experience. A lesson, perhaps. The market giveth, and the market taketh away. Mostly taketh, if you look at it closely.

So, wait. Wait for lower prices. Wait for some good news. A reversal of the trend. A sign that things are turning around. Or just wait. Waiting is, after all, a perfectly valid strategy. Especially when dealing with the unpredictable chaos of the universe and the even more unpredictable behavior of investors. So it goes.

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2026-01-17 02:52