Overview
Goldman Sachs has reiterated its Buy recommendation on Progressive Corp. (NYSE: PGR) and set a price target of $230.00, which implies an approximate 14% total return from current levels. The firm notes that Progressive is trading below what InvestingPro labels as its Fair Value, and highlights valuation metrics including a price-to-earnings ratio of 11.8 and a PEG ratio of 0.36 as evidence of an attractive valuation relative to growth.
Analyst reaction to results
The brokerage maintained its buy rating after Progressive released December results and left its earnings-per-share estimates for 2026, 2027, and 2028 largely unchanged. Goldman Sachs raised its 2026 Personal Auto policies-in-force, or PIF, growth expectation by 30 basis points to 8.1%. The firm attributed that upward revision to strong growth during the quarter, which it says was supported by improved advertising efficiency in the back half of 2025.
Progressive reported robust top-line expansion, growing revenue by 18.35% over the trailing twelve months and generating $85.17 billion in revenue. Goldman Sachs cited the fourth quarter 2025 surge in PIF as evidence that Progressive can win share even in competitive markets, and suggested that this capability could justify a higher multiple on normalized underwriting earnings.
Underwriting and premium dynamics
Despite lifting its PIF forecast, Goldman Sachs did not move its view on net premiums written, or NPW, growth for Personal Auto. The firm pointed to Personal Auto premium-per-policy in the month as a moderating factor, which was 0.4 percentage points below expectations. As a result, Goldman Sachs continues to incorporate a negative low single-digit impact from pricing into its NPW growth estimates for 2026.
Goldman also added a modest amount of additional deterioration to its 2026 Personal Auto underlying loss ratio assumption - less than 10 basis points - to reflect weaker monthly results. In the Agency channel, the firm increased its expense ratio forecast by about 20 basis points for 2026, citing potential commission pressures that may be elevating Agency expenses, as seen in the fourth quarter of 2026.
Peer analyst activity and corporate moves
Other brokerages have issued a range of views in recent weeks. BofA Securities raised its price target for Progressive to $334 from $328 while keeping a Buy rating, noting the company added 211,000 net new policies in December, a result that beat both BofA’s forecast and consensus expectations. BMO Capital lowered its price target to $232 while maintaining a Market Perform rating and suggested that the worst of the top-line deceleration may be behind the company. Morgan Stanley maintained an Underweight rating and a $214 price target while acknowledging Progressive’s strong policy-in-force growth as a favorable indicator in a difficult operating environment.
Progressive also announced a planned finance leadership transition. CFO John Sauerland will retire in July 2026 after 35 years with the company. Andrew Quigg, who currently serves as Chief Strategy Officer, has been named as Sauerland’s successor and will coordinate with the outgoing CFO to ensure an orderly handover.
What this means
Goldman Sachs’ note combines selective upward revisions with cautious underwriting and expense assumptions. The firm is bullish enough on Progressive’s ability to grow policies and gain share to keep a Buy rating and a $230 target, while still recognizing near-term pressures on premium-per-policy and modest deterioration in loss and expense metrics. Investors should weigh the valuation metrics cited by the firm alongside these underwriting and pricing considerations.
Data points summarized
- Goldman Sachs price target: $230.00 (Buy)
- Implied potential total return: ~14%
- Progressive trailing 12-month revenue growth: 18.35% resulting in $85.17 billion in revenue
- P/E ratio: 11.8; PEG ratio: 0.36
- Goldman 2026 Personal Auto PIF growth forecast: 8.1% (up 30 bps)
- Modest addition to 2026 Personal Auto underlying loss ratio: <10 basis points
- Agency expense ratio increase assumption for 2026: ~20 basis points
- BofA price target: $334 (Buy) after 211,000 net new policies in December
- BMO price target: $232 (Market Perform)
- Morgan Stanley price target: $214 (Underweight)
- CFO transition: John Sauerland to retire July 2026; Andrew Quigg named successor