Piper Sandler raises Assurant stock rating to Overweight

Published 10/04/2025, 09:54
Piper Sandler raises Assurant stock rating to Overweight

On Thursday, Piper Sandler analyst team made a notable change in their stance on Assurant (NYSE:AIZ) shares, upgrading the stock from Neutral to Overweight. Alongside this upgrade, they have set a new price target of $223.00, signaling confidence in the company's financial prospects. The company's strong fundamentals are reflected in its perfect Piotroski Score of 9, according to InvestingPro data, indicating robust financial health.

The upgrade comes as Piper Sandler analysts believe Assurant's stock has been unduly affected by market volatility related to tariffs. They argue that the current stock valuation is attractively low, making it an opportune time for investors to consider the stock. The analysts underscore that they expect the company's earnings per share (EPS) to remain stable for several reasons. InvestingPro analysis supports this view, with the company showing solid revenue growth of 6.7% and maintaining a "GOOD" overall financial health score.

A significant factor in this positive outlook is the auto warranty segment, which accounts for approximately 55% of the premiums in Assurant's Global Lifestyle division. This division contributes roughly 55% of the company's overall Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA). The segment has recently undergone substantial pricing increases to mitigate rising input costs. The analysts anticipate that the positive effects of these changes will become more evident in 2025 due to the long-term nature of the business's contracts. Additionally, they point out that two-thirds of the risk from input costs is shouldered by enterprise partners, suggesting that the impact on Assurant should be moderate.

Furthermore, Piper Sandler sees continued robust top-line growth in the Global Housing sector. They also mention that the underwriting guidance for Global Housing appears conservative, which may imply a potential for upside performance.

The analysts also highlight that Assurant's shares are trading at approximately 10 times forward EPS, which is notably lower than the 10-year average of 11.6 times. Current InvestingPro data shows a P/E ratio of 14.3x and an attractive PEG ratio of 0.61, suggesting good value relative to growth. According to InvestingPro's Fair Value analysis, the stock appears undervalued, reinforcing their decision to upgrade the rating to Overweight. For deeper insights into Assurant's valuation and access to comprehensive financial metrics, investors can explore the detailed Pro Research Report available on InvestingPro.

The new price target of $223.00 represents Piper Sandler's revised expectation for Assurant's stock value, providing a clear benchmark for investors monitoring the company's performance.

In other recent news, Assurant has introduced a new vehicle service contract called Assurant Vehicle Care Technology Plus, which combines coverage for advanced vehicle technology with smartphone repair benefits. This plan addresses the integration of high-tech components in modern vehicles and offers additional services like emergency roadside assistance. Meanwhile, Truist Securities has maintained a Buy rating on Assurant, with a price target of $250. This confidence is based on Assurant's strategic financial practices and favorable position in key markets, despite challenges such as increased catastrophe losses from the LA wildfires. The firm's analysts have adjusted their earnings estimates, reflecting a cautious yet optimistic outlook for Assurant's financial performance. Additionally, Assurant's recent investments in digital advancements have been recognized by key clients like Bank of America and JPMorgan, enhancing customer engagement and operations. In the Global Automotive sector, Assurant has executed price hikes with key clients, contributing to a positive earnings shift. The company's Global Housing segment is also on track for robust earnings growth, supporting Truist Securities' continued endorsement of Assurant stock.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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