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On Thursday, TD Cowen analysts maintained a positive stance on Kemper Corp (NYSE:KMPR), reiterating a Buy rating and a $90.00 price target for the company’s shares. The endorsement follows a recent discussion with Kemper’s top executives, who confirmed a favorable outlook for the company’s growth and underwriting performance through 2025. According to InvestingPro data, Kemper, with a market capitalization of $4.3 billion, appears undervalued at its current trading price of $67.84, while analysts’ targets range from $79 to $90.
Kemper’s CEO Joseph Lacher and CFO Brad Camden provided insights during a call hosted by TD Cowen, underscoring the company’s competitive edge in the non-standard auto insurance market. They highlighted that the current hard market conditions are likely to sustain Kemper’s projected "low-teens" unit growth rate. Looking ahead to 2025, the executives anticipate that the company’s combined ratios, which are a measure of insurance profitability, will remain robust. TD Cowen projects a combined ratio of 93.2%, suggesting that the earned rate will align with the expected loss trend, even when considering potential impacts from tariffs. InvestingPro analysis shows the company maintains a "GOOD" overall financial health score, with particularly strong momentum metrics and a solid return on equity of 12%.
The $90 price target set by TD Cowen indicates a 34% upside potential for Kemper’s stock. This valuation is derived from a historical analysis of Kemper’s price-to-earnings (P/E) multiple. By applying a 13.5x P/E to the estimated earnings per share (EPS) for 2026, TD Cowen’s target is justified. Historically, from 2010 to 2019, Kemper traded at an average next twelve months (NTM) P/E of approximately 15.2x.
The affirmation of the Buy rating and price target by TD Cowen reflects confidence in Kemper’s strategic positioning and expected performance in the coming years. It underscores the belief that the company is well-positioned to capitalize on favorable market conditions and deliver on its growth and profitability targets.
In other recent news, Kemper Corporation announced an increase in its quarterly dividend, raising it by 3.1% to $0.32 per share. This adjustment brings the annual dividend to $1.28 per share, up from $1.24. The company’s President and CEO, Joseph P. Lacher, Jr., stated that this increment demonstrates confidence in Kemper’s potential for sustained, long-term growth. Eligible shareholders must be on record by February 18, 2025, to receive the dividend, which is scheduled for disbursement on March 4, 2025. This development reflects Kemper’s ongoing commitment to delivering value to its shareholders. The information was provided in a press release from Kemper Corporation.
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