10 Best Low Volatility Stocks to Invest in Now

7. The Progressive Corporation (NYSE:PGR)

Number of Hedge Fund Holders: 89

5-year Beta (Monthly): 0.37

The Progressive Corporation (NYSE:PGR) offers personal and commercial auto, property, and specialty insurance in the U.S. It operates through three segments: Personal Lines (auto and recreational vehicles), Commercial Lines (business vehicle and liability coverage), and Property (residential and renters’ insurance). Its products are sold through independent agencies, mobile apps, and phone services.

In the third quarter, Progressive (NYSE:PGR) reported solid earnings with GAAP EPS of $3.97 outperforming the estimates by $0.08. Its revenue of $19.46 billion was up nearly 31% year-over-year and exceeded the estimates by $400 million. The company reported a combined ratio of 89%. The combined ratio is a key financial metric used by insurance companies to measure their profitability and efficiency.

A combined ratio under 100% indicates that the company is making an underwriting profit, which means that it is paying out less in claims and expenses than it is earning in premiums, while a combined ratio over 100% suggests an underwriting loss.

In addition, Progressive (NYSE:PGR) achieved record growth with nearly 1.6 million new policies added, driven by strong demand and an increase in media spending. Both direct and agency channels saw significant growth, with record-high direct channel applications and strong customer conversions. Despite historically lower sales in Q4, the company aims to maintain this momentum and continue capturing market share.

The investment management firm, The London Company also commended the company on its increasing market share in its third quarter 2024 investor letter. The firm said that Progressive (NYSE:PGR) has been a strong performer, increasing market share and improving margins through better segmentation of underwriting risks and strategic pricing. The company met its profitability goals by reducing advertising expenses and targeting preferred customers. The firm’s confidence remains high in Progressive’s (NYSE:PGR) ability to perform in various market conditions, thanks to its competitive strengths and effective capital allocation strategy.