Progressive Corp (PGR) receives a strong valuation score of 65 from InvestorsObserver's analysis. Our proprietary scoring system considers the overall health of the company by looking at the stock's price, earnings, and growth rate to determine if it represents a good value. PGR holds a better value than 65% of stocks at its current price. Investors who are focused on long-term growth through buy-and-hold investing will find the Valuation Rank especially relevant when allocating their assets.
Metrics Analysis
PGR's trailing-12-month Price to Earnings (PE) ratio of 11 puts it around the historical average of roughly 15. PGR is a average value at its current trading price as investors are paying around what its worth in relation to the company's earnings. PGR's trailing-12-month earnings per share (EPS) of 8.62 does justify what it is currently trading at in the market. Trailing PE ratios, however, do not factor in a company's projected growth rate, resulting in some firms having high PE ratios due to high growth potentially enticing investors even if current earnings are low.
PGR has a 12 month forward PE to Growth (PEG) ratio of 2.06. Markets are undervaluing PGR in relation to its projected growth as its PEG ratio is currently below the fair market value of 1. 8.61999988's PEG comes from its forward price to earnings ratio being divided by its growth rate. PEG ratios are one of the most used valuation metrics due to its incorporation of more company fundamentals metrics and a focus on the firm's future rather than its past.
Summary
All together these valuation metrics paint a pretty poor picture for PGR at its current price due to a overvalued PEG ratio due to strong growth. The PE and PEG for PGR are worse than the average of the market resulting in a valuation score of 65.
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