Allstate Corp Earnings: Exceeds Forecasts with Boost of Profit Rise

S&P 500 (NYSE:SPY) component Allstate Corporation (NYSE:ALL) reported net income above Wall Street’s expectations for the fourth quarter. Allstate provides insurance on personal property as well as offering casualty insurance, life insurance, retirement, and investment products.

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Allstate Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for the property and casualty insurance company rose to $724 million ($1.43 per share) vs. $296 million (55 cents per share) in the same quarter a year earlier. This is a more than twofold rise from the year earlier quarter.

Revenue: Rose 1.8% to $8.24 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: Allstate Corporation beat the mean analyst estimate of 94 cents per share. It beat the average revenue estimate of $6.47 billion.

Quoting Management: “We continued to execute our strategy to increase shareholder value by improving overall returns and offering unique products for different customer segments. Operating income increased to $750 million in the fourth quarter, a $479 million increase from prior year due to substantially lower catastrophe losses. We maintained auto insurance profitability, raised underlying returns in homeowners and Allstate Financial, achieved excellent investment returns and expanded our new product offerings,” said Thomas J. Wilson, chairman, president and chief executive officer of The Allstate Corporation. “While full year 2011 net income of $788 million was 15% below 2010, this reflects high catastrophe losses in 2011 that were largely offset by realized capital gains. The underlying combined ratio for 2011 of 89.3 was within the outlook established at the beginning of the year of 88 to 91. ”

Key Stats:

The company has now topped analyst estimates for the last four quarters. It beat the mark by 5 cents in the third quarter, by 30 cents in the second quarter, and by 25 cents in the first quarter.

Revenue has risen the past four quarters. Revenue increased 4.2% to $8.24 billion in the third quarter. The figure rose 5.6% in the second quarter from the year earlier and climbed 4.5% in the first quarter from the year-ago quarter.

Looking Forward: Analysts appear increasingly optimistic about the company’s results for the next quarter. The average estimate for the first quarter of the next fiscal year has moved up from 98 cents a share to 99 cents over the last ninety days. The average estimate for the fiscal year has risen to 81 cents per share from 77 cents in the past month.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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