Allstate Profits Beats Estimates, Best Since 2012

Allstate Corp., the largest publicly traded U.S. auto and home insurer, gained the most since August 2012 after profit beat analysts’ estimates.

Allstate advanced 5.7 percent to $52.36 at 4:02 p.m. in New York, the biggest jump in the 81-company Standard & Poor’s 500 Financials Index. Fourth-quarter profit more than doubled to $810 million, or $1.76 a share, the Northbrook, Illinois-based insurer said yesterday in a statement.

Operating profit, which excludes some investment results, was $1.70 a share, beating by 33 cents the average estimate in a Bloomberg survey of 22 analysts. Allstate spent 88.7 cents on claims and expenses for every premium dollar in its property and liability unit, compared with $1.02 in the last three months of 2012.

The insurer “posted a solid core loss ratio,” Keefe, Bruyette & Woods Inc. analysts led by Meyer Shields said in a note to clients. “Homeowners results outperformed our estimate due to the quarter’s favorable weather” and rate increases. He rates the company outperform.

Catastrophe costs in the last three months of 2013 fell to $117 million from $1.06 billion, Allstate said. The fourth quarter of 2012 included damages from Superstorm Sandy, which struck the U.S. East Coast in October. The storm caused about $35 billion in insured losses industrywide, according to the Insurance Information Institute.

Allstate, which has almost doubled since the end of 2011, is up 18 percent in the past year. That compares with the 19 percent rally in the S&P Financials index.

(Editors: Dan Reichl, Dan Kraut)