UBS’ Top Quant Stocks In AI, IT, Healthcare & Other Sectors: Top 33 Stocks In All Sectors

19. The Allstate Corporation (NYSE:ALL)

Number of Hedge Fund Investors In Q2 2024: 61

Sector: Financials

The Allstate Corporation (NYSE:ALL) is one of the biggest property and casualty insurance companies in America. As of H1 2024, nearly 89% of the firm’s revenue came from property and casualty insurance premiums. The Allstate Corporation (NYSE:ALL)’s size as the fourth biggest American home insurance company also heavily exposes the firm to catastrophe losses driven by climate change and hurricanes in the US. This has been the case in 2024 as well, with The Allstate Corporation (NYSE:ALL) taking a massive $630 million catastrophe hit from Hurricane Helene which also led to its shares losing 5.81% in mid-October. To shore up capital, the firm is also selling its employee benefits division, and its turnaround strategy for the auto insurance business through selective underwriting and expense reduction led to a combined ratio of 96 for the business in Q1. Further improvement coupled with overall expense reduction could lead to tailwinds for the stock.

Ariel Investments mentioned The Allstate Corporation (NYSE:ALL) in its Q2 2024 investor letter. Here is what the fund said:

“We added property and casualty insurer, Allstate Corporation. A challenging macro-environment, inflation and lower reserve development led to significant underwriting losses across key markets, presenting us with an attractive entry point. Looking ahead, we expect the strong pricing environment, coupled with lower inflationary pressure and future premium growth to yield upside for shares. Additionally, management is committed to improving its adjusted expense ratio and recently made upgrades to its claims handling processes to minimize loss development and lower claim severities.”