Keefe Bruyette & Woods analyst Christopher Campbell and William Blair analyst Adam Klauber separately initiated coverage of Goosehead Insurance Inc. with an "outperform" rating.
Campbell wrote in a research note that the company's better-than-peer growth coupled with margin expansion should drive share outperformance. He expects the company to achieve improved personal lines market penetration and better-than-peer revenue growth, thanks to solid distribution growth and better-than-peer new business sales productivity across both corporate and franchise sales channels.
Factors that should contribute to share price outperformance are favorable personal lines market dynamics, solid organic growth and limited volatility, the KBW analyst said.
Campbell's price target on Goosehead Insurance is $20. His EPS estimates for the company are 24 cents for 2018, 40 cents for 2019 and 65 cents for 2020.
Klauber also has an upbeat view on Goosehead Insurance, writing that the company's stock is an attractive opportunity to invest in a high-growth technology-enabled distributor set to quickly expand free cash generated over the next several years.
Klauber wrote that Goosehead Insurance is leveraging new technology along with a focused market strategy to rapidly gain share in the personal lines market, pointing out that the company's business model has helped the company gain a unique position in the market. The William Blair analyst expects Goosehead Insurance to further grow its sales and improve its margins.
Klauber's EPS estimates for the company are 31 cents for 2018 and 51 cents for 2019.
