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Research Alert: CFRA Keeps Strong Buy Recommendation On Shares Of The Allstate Corporation

· 02/04/2021 19:37

12:35 AM EST, 02/05/2021 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We keep our 12-month target price of $130, or 10.3x our 2021 operating EPS estimate of $12.60 (up by $0.50) and 10x our 2022 operating EPS estimate of $13.05, versus the shares' five-year average forward multiple of 11.3x and a peer average of 11.1x. Q4 operating EPS of $5.87 versus $3.31 topped our $3.56 EPS estimate, the $3.82 consensus forecast on better-than-expected claim trends (evidenced by the Q4 combined ratio of 84% versus 88.7%) and 5.7% fewer shares. Full-year 2020 EPS of $14.73 versus $10.43 topped our $12.50 EPS estimate, the $12.70 consensus forecast on 1.5% higher operating revenues (versus our forecast of 1% growth), improved claim trends (a combined ratio of 87.6% versus 92%) and 5.4% fewer shares. We see improved demand and pricing driving operating revenue growth to 5% to 7% in 2021 and 4% to 8% in 2022. Trading at 8.5x our 2021 EPS estimate, with the catalysts of improved property-casualty insurance growth trends and the sale of the laggard life unit, ALL is undervalued, in our view.