Deutsche Bank Reiterates Hold Rating on Allstate Corp. (ALL)

Deutsche Bank is out with a research report this morning, where its analysts reiterated its Hold rating on shares of Allstate Corp. ALL; it has a $32.00 price target on the stock. The DB analysts said, “Following our meeting with management, we remain concerned about 2Q10 results, particularly with regard to the potential for continued policy count decline in auto insurance, large "non-modeled" catastrophe losses and the ability to grow while the industry raises auto insurance prices. Longer-term, changes at Allstate Financial may be introducing new attractive products to a receptive agency force.” They noted, “We view the current auto insurance marketplace with increasing rates and accelerating shopping behavior as a potentially transformative moment for the auto insurance industry where meaningful market share disruption may occur. Given our concern regarding Allstate's competitive performance last quarter, we question whether the company will prove itself a winner under current market conditions. If 2Q10 repeats the policy count losses of 1Q10, it may signal that Allstate's direct offering is unable to offset marketshare losses to competitors, which may persist given current advertising trends.” The DB analysts further noted, “The life business seems poised to re-engage its captive agency force with underwriting, as opposed to spread-based, products. Agent re-education on the new "Good for Life" offering aims to introduce a middle market focus to a formerly less attentive audience in an effort to create the much longed-for cross-sell between Life and P&C. New management brings new energy to the effort.”