Allstate Beats Profit Estimates at $9.76 a Share as Revenue Falls Short

Allstate (NYSE: ALL) reported third-quarter revenue of $17.35 billion, below the $17.46 billion analysts expected, and adjusted earnings of $9.76 per diluted share, above the $6.96 consensus estimate, in an 8-K furnished Wednesday, Nov. 4.

Revenue rose 0.5% from a year earlier, or $93 million. Net income applicable to common shareholders was $2.1 billion, or $8.03 per diluted share, compared with $3.7 billion, or $13.95 per share, a year earlier. The company said the decline was primarily due to increased catastrophe losses, a gain on the sale of the group health business in 2025 and net losses on investments and derivatives, partly offset by higher earned premiums. Adjusted net income was $2.5 billion, or $9.76 per diluted share, compared with $3.0 billion, or $11.17, a year earlier.

Property-Liability and catastrophe losses

Property-Liability earned premiums rose 3.8% to $15.1 billion. The recorded combined ratio was 86.6, up from 80.1 a year earlier, which the company attributed mainly to 7.1 points of higher catastrophe losses. Catastrophe losses totaled $1.65 billion, compared with $558 million in the prior-year quarter.

Underwriting income fell 30.1% to $2.0 billion from $2.9 billion. Auto and homeowners policies grew 3.4% and 3.3%, respectively, and Property-Liability policies in force reached 39.3 million. Homeowners premiums earned rose 11.5%, while the homeowners recorded combined ratio was 89.5, compared with 71.5 a year earlier.

Protection Services and investments

Protection Services revenue increased 6.9% to $964 million, led by Protection Plans and Roadside growth. Adjusted net income for the segment was $64 million, up $18 million from a year earlier.

Net investment income rose $228 million to $1.2 billion, reflecting higher market-based and performance-based results. The company recorded net losses on investments and derivatives of $545 million in the quarter.

Total policies in force reached 217.6 million, up 3.9%. Book value per common share was $120.23, compared with $95.95 a year earlier. Common shares outstanding fell to 248.8 million from 262.1 million. The board's quarterly dividend declared was $1.08 per share.

For the next quarter, analysts expected EPS of $9.40 and revenue of $17.62 billion. For the full year, the average analyst estimate was EPS of $35.96 and revenue of $70.19 billion.