Allstate Earnings Preview: Looking for a Turnaround

Posted Feb 10th 2010 9:30AM by Trey Thoelcke
Filed under: Earnings Reports, Forecasts, Allstate Corp (ALL)

Allstate Corp. (ALL), which has been the subject of rumors concerning the termination of agents, is scheduled to release fourth-quarter financial results after the market closes Wednesday, and then to discuss those results in a conference call tomorrow, Thursday, Feb. 11, at 9:00 AM (ET). An audio webcast of the call will be available at the company's website.

During the three months that ended in December, Allstate named a new marketing chief, welcomed a new board member and declared a quarterly dividend. Analysts surveyed by Thomson Reuters are looking for earnings for that period to come to $1.01 per share. That compares with 99 cents per share in the previous quarter and 97 cents per share a year ago. Revenue for the fourth quarter is expected to be 23.0% higher than a year ago to $8.1 billion.

For the full year, analysts expect to see earnings of $3.39 per share (+5.0%) on $32.0 billion (+9.0%) in revenue. However, Allstate earnings have fallen short of consensus estimates in recent quarters, though only by a penny per share in the third quarter.

This Northbrook, Ill.-based insurer's long-term EPS growth forecast of 6.8% is less than that of competitor Travelers Companies Inc. (TRV), but its earnings multiple of 7.2x is as well. The First Call consensus recommendation has been to buy ALL for more than 90 days, and the mean price target is $35.54. But Zacks expects a negative surprise from Allstate, while TheStreet.com suggests that continued poor performance would put more pressure on embattled CEO Tom Wilson.

Shares have traded within a couple of bucks of $32 since August and have slipped to the low side of that range in recent weeks.

Tags: ALL, Allstate, earnings, featured, Travelers, TRV