Insurance Stocks

Allstate Corporation Quarterly Stock Valuation – October 2014 $ALL


Enterprising Investors following the ModernGraham approach should keep a keen eye on Allstate and pour some time into conducting further research. The Defensive Investor may not feel the same way, with concerns regarding the lack of earnings stability or growth over the last ten years. However, Enterprising Investors have no initial concerns, and should feel very comfortable proceeding to the next part of the analysis, which is a determination of the company’s intrinsic value.

The company has grown its EPSmg (normalized earnings) from $1.94 in 2010 to an estimated $4.08 for 2014. This is an outstanding level of growth, which significantly outpaces the market’s implied estimate of only 3.18%. As a result of the strong growth demonstrated historically, the ModernGraham valuation model returns an estimate of intrinsic value well above the price, supporting a clear conclusion that the company is significantly undervalued. Enterprising Investors are therefore encouraged to proceed with further research to determine whether Allstate Corporation is suitable for their own individual portfolios.

Read the full valuation on Seeking Alpha!

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