QS Research · Michael Burry's Scion Capital analyst template · 2006
PROGRESSIVE CORP/OH/ (PGR)
As of 2026-11-06 · 11/15 boxes filled from SEC filings and market data
Conclusion: WATCH
Conviction low · base case 0% · downside -12% · upside +11%
At $227.77 (N1), PGR trades at 11.4x TTM EPS (N24) and 3.83x book (N25) with a 33.7% ROE (N23); the peer band of 10.0x-12.6x gives roughly -11.9% to +11.0%, so the base case is about flat at today's multiple. The market is not missing the franchise: underwriting is strong, with Q3 2026 combined ratio 88.7 vs 89.5 (S27), but growth is decelerating and reported ROE is both helped by favorable reserve development and hit by investment marks. Base value is $227.77 at 11.4x ~$20.06 TTM EPS; downside is 10.0x = $200.6 (-11.9%) and upside is 12.6x = $252.8 (+11.0%). There is no deep-value margin of safety for a long, and no short either because earnings and capital remain robust. This is interesting but not yet mispriced enough; watch.
Key numbers
- Share price: $227.77
- Market cap: $131.96B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $91.73B
- P/E (TTM): 11.4x
- Price / book: 3.83x
The 15 boxes
- ✓ 1. Long-form business notes
Progressive is a U.S. personal and commercial property-casualty insurer; in FY2025 Personal Lines was 87% of total net premiums written and Commercial Lines 13%, with $83.2B of net premiums written. Personal auto dominates Personal Lines, and the direct channel wrote 57% of personal vehicle net premiums written in 2025 versus 54% in 2023. Since the FY2020 10-K, Personal Lines has added personal residential property, now 4% of Personal Lines net premiums written in 2025, and personal auto market rank moved from third for 2019 to second for 2024.
- ○ 2. Competitive advantage
Progressive’s durable advantages in the sources are brand and underwriting/pricing discipline, not a quantified moat: S25 calls brand recognition and trust critical and says advertising effectiveness versus competitors matters, while saying success depends on accurate underwriting and risk-based pricing. S26 shows scale and capital accumulation, with revenue rising from $42.66B in FY2020 to $87.67B in FY2025 and equity from $17.04B to $30.32B, but earnings were volatile (pre-tax $922.0M in FY2022 versus $14.22B in FY2025). The sources name no competitors and give no market-share, ROE, or price/book data.
- ✓ 3. 10-Q takeaways
Q3 2026 underwriting stayed strong: companywide margin 11.3% vs 10.5% in Q3 2025, NPW $22.3B (+4%), NPE +5%, and PIF +6%. Personal Lines margin was 12.0% (personal property 27.2%) while Commercial Lines slipped to 7.4% from 10.8%. Net income decreased $73M YoY and comprehensive income decreased $2,254M on unrealized fixed-maturity losses, separate from underwriting. Capital was $42.9B with a 19.6% debt-to-total-capital ratio, 9M buybacks $1.6B, and the risk-factor update reported no material changes.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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