Analyst Elyse Greenspan from Wells Fargo maintained a Buy rating on Arch Capital Group (ACGL – Research Report) and increased the price target to $108.00 from $106.00.
Elyse Greenspan’s rating is based on Arch Capital Group’s strong return on equity and capital return, which present an appealing risk/reward profile at the current valuation. Despite increased competition in the market, Arch has demonstrated an ability to adapt and find growth opportunities, maintaining a healthy level of excess capital that supports continued strong capital returns.
Additionally, the company’s earnings per share estimates have been adjusted, with a modest increase in the price target due to higher peer multiples. Arch’s reinsurance premium growth remains solid, and while some lines of business face challenges, others, particularly in casualty-led sectors, show significant growth potential. The mortgage segment, despite economic headwinds, is expected to continue generating attractive underwriting income due to the high credit quality of the portfolio.
In another report released yesterday, JMP Securities also reiterated a Buy rating on the stock with a $125.00 price target.
Based on the recent corporate insider activity of 40 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of ACGL in relation to earlier this year.