A Fresh Look at Allstate (ALL) Valuation After Strong Q3 Earnings and Analyst Upgrades

Allstate (ALL) just posted a jump in both revenue and net income for the third quarter, with earnings per share climbing sharply from a year ago. The numbers are already drawing increased attention from investors and analysts alike.

See our latest analysis for Allstate.

Allstate’s strong earnings and recent share buybacks have clearly put the spotlight on the company, with analysts expressing renewed confidence. After this upbeat quarter, the share price has climbed 6.2% over the past week and now sits at $207.36. That said, momentum is up modestly for the year, with a year-to-date price return of 8.0% and a 1-year total shareholder return of 6.7%. The longer-term view is impressive, considering the 68.8% three-year and 136.1% five-year total returns.

If you’re inspired by Allstate’s resilience, now could be the perfect opportunity to discover fast growing stocks with high insider ownership.

With such a surge in earnings and bullish analyst upgrades, investors must now ask whether Allstate is still trading at an attractive valuation or if the recent gains mean its future growth is already priced in.

Most Popular Narrative: 11.2% Undervalued

With the narrative fair value of $233.45 compared to the last close at $207.36, the gap between analyst expectations and current trading levels is hard to ignore. This sets the stage for why market watchers are debating just how much upside remains.

The rollout of Allstate's new digitally enabled, "Affordable, Simple, Connected" auto and homeowner products across multiple states, coupled with sophisticated pricing and expanded distribution, is expected to drive profitable policy growth and improve top-line revenue as traditional and direct-to-consumer channels scale.

Read the complete narrative.

Curious why analysts see even greater value despite forecasts of shrinking margins and slowing growth? The narrative relies on bold strategic pivots, aggressive product overhauls, and a future profitability multiple that might surprise you. What secrets do these projections hold? See the full narrative to uncover what’s fueling this valuation.

Result: Fair Value of $233.45 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, increased catastrophe losses and intensifying competition from digital-first rivals could undermine Allstate's projected growth and margin improvements.

Find out about the key risks to this Allstate narrative.

Build Your Own Allstate Narrative

If you want to dig deeper and draw your own conclusions, you can easily build a personalized narrative in just a few minutes, so why not Do it your way?

A great starting point for your Allstate research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

Looking for More Investment Ideas?

Give your portfolio a competitive edge by harnessing powerful stock screeners designed for different market themes. Don’t settle for average returns when these unique strategies could help you find your next winner.

• Tap into reliable income with attractive yields by scanning these 15 dividend stocks with yields > 3%. These options often consistently outperform standard savings accounts.
• Ride the AI momentum and capitalize on new trends by targeting these 25 AI penny stocks. These stocks may offer significant growth potential.
• Find tomorrow’s winners trading at a bargain by hunting for these 857 undervalued stocks based on cash flows based on real cash flows.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com