Goosehead Insurance upgraded to Outperform from Market Perform at BMO Capital

BMO Capital analyst Michael Zaremski upgraded Goosehead Insurance to Outperform from Market Perform with a price target of $90, up from $86. The analyst sees Goosehead’s revenues bottoming at 29% in Q3 and then reaccelerating the following quarter and ultimately stabilizing in the 30%-plus range as a number of headwinds such as low-productive agent culling and overall industry-wide home and auto profits normalize. Management’s recently implemented and ongoing business model pivots will result in upward earnings revisions in the coming quarters, the analyst tells investors in a research note. BMO sees a “clearer line of sight” for investors to foresee Goosehead’s revenues reaccelerating and basing at 30% or more, “which could further help the stock’s valuation.”