BMO Capital downgrades Baldwin Insurance stock rating on near-term growth concerns

Investing.com - BMO Capital downgraded Baldwin Insurance (NASDAQ:BWIN) from Outperform to Market Perform on Monday, while reducing its price target to $33.00 from $38.00. The stock has declined over 32% in the past six months, with current trading at $28.30, significantly below its 52-week high of $55.82. According to InvestingPro analysis, the stock appears undervalued at current levels.

The downgrade reflects BMO Capital’s near-term organic growth estimates falling below consensus expectations for the insurance company.

BMO Capital also expressed concerns about potential risks to Baldwin Insurance’s 2026 guidance, which is expected to be released on November 4.

Despite the downgrade, BMO Capital noted several factors that could support the company’s performance over time, including improvements in cash flow conversion and margin expansion opportunities through offshoring initiatives.

The firm also highlighted Baldwin’s emerging embedded mortgage distribution channel as a potential long-term positive for the company.

In other recent news, Baldwin Insurance Group reported its second-quarter 2025 results, meeting earnings expectations with an adjusted diluted EPS of $0.42, as anticipated by analysts. The company slightly exceeded revenue forecasts, reporting $378.8 million compared to the projected $374.3 million. Additionally, Baldwin Insurance Group amended its existing credit agreement to include a $75 million incremental term loan, increasing the total principal amount of its term loans to $1.006 billion. This amendment was executed with JPMorgan Chase Bank, with the new loan intended to pay down outstanding borrowings under its revolving credit facility.

In another development, Raymond James downgraded Baldwin Insurance Group’s stock rating from Strong Buy to Outperform, lowering its price target to $40.00 from $48.00. This downgrade follows a 17% sell-off after Baldwin’s earnings report and is attributed to the company’s transition to a reciprocal exchange, which is expected to affect organic growth and adjusted EPS through the first half of 2026. These recent developments highlight significant financial maneuvers and strategic challenges facing Baldwin Insurance Group.

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