KBW Reiterates OP Rating, Maintains $28 PT on Tower Group

KBW is reiterating its Outperform rating and maintaining its $28 PT on shares of Tower Group TWGP. “Tower announced it experienced $8 million of catastrophe losses in 2Q related to spring severe storms, which exceeded our $1.5 million estimate,” KBW writes. “Management now expects to be at the low end of its previously announced $2.70 to $2.90 FY11 EPS range. We're lowering our 2Q11 estimate, but maintaining our FY11 estimate. We're maintaining our TP at $28. We reiterate our OP rating and believe Tower's shares are undervalued relative to performance expectations.” Tower Group closed Monday at $23.37.