Janney upgrades Donegal Group to Buy on improved profitability

As previously reported, Janney Montgomery Scott upgraded Donegal Group (DGICA) to Buy from Neutral with an unchanged $21 fair value estimate. Management has taken a number of steps over the last few years to improve profitability, including implementing new systems to streamline business processes and workflows and enhancing data analytics and predictive modeling tools to inform risk selection and pricing decisions, notes the analyst, who also points out that management has non-renewed business in certain unprofitable states and classes of business over the last two years. The firm raised its 2025 and 2026 operating EPS estimates, largely to reflect stronger underwriting results, the analyst added.