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Allstate posts strong Q2 underwriting recovery with 86.6% combined ratio, downgrading to Buy.

Analyst Insights
08 Aug 2026
Seeking Alpha
View Source
Neutral
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Allstate confirmed a strong underwriting recovery in Q2 with an 86.6% combined ratio and an 84.3% combined ratio for the first half of the year. Auto insurance remained highly profitable, and homeowners insurance returned to profitability despite catastrophe losses. Both segments resumed growth while maintaining pricing discipline. The stock's valuation depends on sustaining a combined ratio around 90%, with a fair value estimate of $315-$340, offering 17%-28% upside. Due to the recognition of recovery and reduced margin of safety, the analyst downgraded Allstate from Strong Buy to Buy.

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