On June 18, 2024, Allstate Corp announced the successful closure of its public offering of $500 million in aggregate principal amount of 5.050% Senior Notes due 2029. The offering was completed on Monday, with the notes issued under an existing indenture, further supplemented by the Twenty-Seventh Supplemental Indenture as of the same day.
The Senior Notes are senior unsecured obligations and rank equally with Allstate's other unsecured and unsubordinated indebtedness. They carry a fixed interest rate of 5.050% per annum, with semi-annual payments due on June 24 and December 24, commencing December 24, 2024, and will mature on June 24, 2029.
This financial move was facilitated by an underwriting agreement with a consortium of banks, including BofA Securities, Inc., Goldman Sachs & Co (NYSE:GS). LLC, and other notable financial institutions. The offering was registered under Allstate's registration statement on Form S-3 with the Securities and Exchange Commission.
The issuance of these Senior Notes is part of the company's financial strategy, with the indenture dating back to December 16, 1997, and subsequently amended. The closing of this offering further strengthens Allstate's financial position by adding to its capital structure with long-term debt.
In conjunction with the offering, Allstate filed several documents with the SEC, including the underwriting agreement, the supplement to the indenture, the form of the Senior Notes, and legal opinions regarding the validity of the notes.
This financial event is based on information outlined in a press release statement filed with the SEC. Allstate, a leading insurance provider, has not disclosed any specific plans for the use of the proceeds from these Senior Notes. The transaction reflects the company's proactive management of its capital and debt profile.
In other recent news, Allstate Corporation (NYSE:ALL) has been subject to several adjustments by financial analysis firms in light of recent developments. Evercore ISI reduced its price target for Allstate shares due to significant natural catastrophe losses amounting to $1.4 billion in May.
The firm projects a second-quarter earnings per share (EPS) loss of $0.18 for Allstate, down from a previously estimated $2.45 EPS. Still, Evercore ISI expects Allstate's Risk-Based Capital ratio to remain stable at around 213% in the second quarter of 2024.
Despite these challenges, Keefe, Bruyette & Woods maintained an Outperform rating for Allstate, with steady earnings projections for 2024 and 2025 at $14.80 and $17.65 per share, respectively. The firm anticipates Allstate will face $1.54 billion in catastrophe losses for the second quarter of 2024. Edward Jones also reaffirmed its Buy rating on Allstate, citing strong underwriting results and above-average profitability.
Allstate recently disclosed estimated catastrophe losses for April, totaling $494 million pre-tax, or $390 million after-tax. The company also declared a quarterly dividend of $0.92 per common share, payable in July 2024, continuing its practice of returning value to shareholders through regular dividends. These are some of the latest developments concerning Allstate Corporation.
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