A month has gone by since the last earnings report for Allstate (ALL). Shares have lost about 4.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Allstate due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for The Allstate Corporation before we dive into how investors and analysts have reacted as of late.
Allstate Q2 Earnings Beat Estimates on Higher Investment Income
Allstate reported a second-quarter 2026 adjusted net income of $8.99 per share, which outpaced the Zacks Consensus Estimate by 56.1%. The bottom line surged 51.3% year over year.
Operating revenues of $17.5 billion grew 4.5% year over year. However, the top line missed the consensus mark by 1.1%.
Allstate's quarterly earnings benefited from improved underwriting performance, premium growth supported by higher pricing and policy growth, robust investment income, and lower catastrophe losses, partly offset by lower adjusted net income in the Protection Services segment.
Key Takeaways From Allstate's Q2 Results
Property and casualty insurance premiums improved 4.2% year over year to $15.7 billion. Net investment income of $1 billion advanced 33.8% year over year on the back of a growing market- and performance-based portfolio. The metric beat the Zacks Consensus Estimate of $870 million. Market-based investment income rose 14.2% year over year to $837 million and performance-based investment income jumped 202.5% year over year to $239 million.
Total costs and expenses were $14.5 billion, which decreased 2.5% year over year and was lower than our estimate of $16.4 billion. The year-over-year decline was due to decreased property and casualty insurance claims and claims expenses, accident, health and other policy benefits and Pension and other postretirement remeasurement (gains) losses. Catastrophe losses of $1.4 billion dropped 12.8% year over year.
Allstate's pretax income increased 53.2% year over year to $4.1 billion. As of June 30, 2026, total policies in force were 216 million, up 3.8% year over year.
ALL's Segmental Performances
The Property-Liability segment reported premiums earned of $14.9 billion in the second quarter, up 4.4% year over year, driven by higher average premiums in homeowners insurance and growth in policies in force. However, the metric missed both the Zacks Consensus Estimate and our estimate of $15.2 billion. Underwriting income in the segment surged 56.7% year over year to $2 billion. The underlying combined ratio improved 10 basis points to 79.4%.
The Protection Services segment's revenues advanced 7.8% year over year to $935 million, aided by Allstate Protection Plans and Roadside businesses. The metric lagged our estimate of $957 million. Adjusted net income of $53 million declined 7% year over year.
ALL's Q2 Financial Update
Allstate exited the second quarter with a cash balance of $840 million, up from $678 million as of 2025-end. Total assets increased to $124.8 billion from $119.8 billion at the end of 2025.
Debt remained unchanged at $7.5 billion from the 2025-end level.
Total equity increased to $33.7 billion from $30.6 billion at the end of 2025.
Book value per common share was $123.38 as of June 30, 2026, up 49.7% year over year.
ALL's Capital Deployment
Backed by its $4.0 billion share repurchase authorization announced on Feb. 4, 2026, the company returned $1.3 billion to shareholders in the second quarter, comprising $1.0 billion in share repurchases and $280 million in dividends. The repurchase program remains in effect through Feb. 29, 2028.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in fresh estimates.
The consensus estimate has shifted 19.63% due to these changes.
VGM Scores
Currently, Allstate has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a score of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Allstate has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Allstate is part of the Zacks Insurance - Property and Casualty industry. Over the past month, Kinsale Capital Group, Inc. (KNSL), a stock from the same industry, has gained 1.8%. The company reported its results for the quarter ended June 2026 more than a month ago.
Kinsale Capital Group reported revenues of $548.52 million in the last reported quarter, representing a year-over-year change of +16.8%. EPS of $5.54 for the same period compares with $4.78 a year ago.
Kinsale Capital Group is expected to post earnings of $4.87 per share for the current quarter, representing a year-over-year change of -6.5%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Kinsale Capital Group. Also, the stock has a VGM Score of C.
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This article originally published on Zacks Investment Research (zacks.com).
