Allstate Earnings: Here’s Why Investors Like These Results

Allstate Corporation (NYSE:ALL) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are up 0.63%.

Allstate Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 28.74% to $1.12 in the quarter versus EPS of $0.87 in the year-earlier quarter.

Revenue: Decreased 17.11% to $6.86 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Allstate Corporation reported adjusted EPS income of $1.12 per share. By that measure, the company beat the mean analyst estimate of $0.98. It missed the average revenue estimate of $7 billion.

Quoting Management: “We are successfully executing our customer-focused strategy to offer unique products and services to distinct consumer segments,” said Thomas J. Wilson, chairman, president and chief executive officer of The Allstate Corporation. “Property-liability premiums written increased 4.2% from the second quarter of 2012, with positive trends in all consumer segments which are served under the Allstate, Encompass and Esurance brands. We maintained profitability with an underlying combined ratio better than our full-year outlook and operating income of $529 million. Proactive execution of the investment strategy to reduce risk related to increases in interest rates proved beneficial as rates moved up in the quarter. We also made progress in strengthening our capital position by repurchasing outstanding debt, issuing new lower-cost financing, while maintaining share repurchases. Shortly after the quarter ended, we announced several other significant strategic actions: the pending sale of Lincoln Benefit Life, a change in employee benefit plans and a decision to cease issuing fixed annuities at year-end 2013.”

Key Stats (on next page)…

EPS decreased 17.04% from $1.35 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $1.00 to a profit $0.99. For the current year, the average estimate has moved down from a profit of $4.74 to a profit of $4.66 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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