Piper Jaffray Upgrades ProAssurance Corp. (PRA) to Overweight; Management Quietly Generating Above-Peer Returns
PRA Hot Sheet
Rating Summary:3 Buy, 0 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 16 | Down: 7 | New: 23
Piper Jaffray upgrades ProAssurance Corp. (NYSE: PRA) from Neutral to Overweight. Price target increased from $69 to $76.
Piper analyst says, "Reflecting upon PRA's recent quarterly results, the conservative nature of this management team becomes more evident. From the carried reserve levels to the capital management approach, shareholders benefit from management's tactics which, all in, generated returns on beginning equity in excess of 15% over the past five years. Given current reserve levels we place a high degree of probability for these trends continuing throughout 2010. Consequently, we revised earnings and target multiple estimates on the shares, while our investment opinion goes to Overweight.
"n revising our EPS estimates higher, we focused on the company's calendar year loss ratio, reducing the metric to 57.7% for both 2010 and 2011. In doing so, our EPS estimates for 2010 and 2011 rise to $5.70 and $6.10 from $5.15 and $5.25, respectively. Meanwhile, we tweaked our target multiple to 1.3x forward book value from 1.2x to give credit for the consistently higher returns generated from PRA."
To see all the upgrades/downgrades on shares of PRA, visit our Analyst Ratings page.
ProAssurance Corporation (ProAssurance) is a holding company for property and casualty insurance companies focused on professional liability insurance.
Piper analyst says, "Reflecting upon PRA's recent quarterly results, the conservative nature of this management team becomes more evident. From the carried reserve levels to the capital management approach, shareholders benefit from management's tactics which, all in, generated returns on beginning equity in excess of 15% over the past five years. Given current reserve levels we place a high degree of probability for these trends continuing throughout 2010. Consequently, we revised earnings and target multiple estimates on the shares, while our investment opinion goes to Overweight.
"n revising our EPS estimates higher, we focused on the company's calendar year loss ratio, reducing the metric to 57.7% for both 2010 and 2011. In doing so, our EPS estimates for 2010 and 2011 rise to $5.70 and $6.10 from $5.15 and $5.25, respectively. Meanwhile, we tweaked our target multiple to 1.3x forward book value from 1.2x to give credit for the consistently higher returns generated from PRA."
To see all the upgrades/downgrades on shares of PRA, visit our Analyst Ratings page.
ProAssurance Corporation (ProAssurance) is a holding company for property and casualty insurance companies focused on professional liability insurance.
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