Piper Jaffray Reiterates Overweight Rating on Tower Group (TWGP)

Piper Jaffray is out with a research report this morning, where it reiterates its Overweight rating on Tower Group Inc. TWGP; it has a $35.00 price target on the stock. The PJ analysts said that, following the PJC Insurance Summit, they continue to believe their thesis is intact and playing out as expected, and multiple expansion is probable in 2011 as ROE's return to historical levels. The analysts also noted that, with roughly $60.0M in cash and cash equivalents at the holding company level, they expect an accretive acquisition to add increased product distribution/premium to high-growth potential, underserved geographies As for valuation, the analysts remarked, “With Tower shares trading around book value, we believe investors need to capture an insurer poised to become a national player, with sound underwriting capable of returning the company to our target 1.3x multiple in 2011.”