Morgan Stanley upgrades Slide Insurance, citing stock is cheap, earnings will be strong

Morgan Stanley Research upgraded Slide Insurance Holdings (NASDAQ: SLDE) to an Overweight rating, citing the stock's appealing valuation and expected strong earnings growth.

Despite recent downward pressures due to concerns about the hurricane season and competition, analysts anticipate robust earnings and a potential annualized return on equity exceeding 40% for 2025.

The stock experienced a 4.91% increase, reaching $14.75, with a price target from Morgan Stanley set at $18.00, aligning with favorable overall Wall Street ratings for the company.

Investment Recommendation: Overweight on Slide Insurance Holdings

Slide Insurance Holdings (NASDAQ: SLDE) has received an upgraded rating from Morgan Stanley Research, highlighting the stock's attractiveness based on its valuation and anticipated strong earnings.

As of Thursday morning, shares experienced a growth of 4.91%, reaching $14.75.

Analyst Bob Jian Huang noted, "Although the stock faced downward pressure in recent weeks, particularly following the second-quarter earnings report due to concerns surrounding an active hurricane season and heightened competition in the Florida market, we believe the current valuation presents an appealing investment opportunity. We expect robust earnings to persist as the hurricane season progresses."

Huang further explained that with an anticipated minimal impact from catastrophe losses in the third quarter of 2025, Slide Insurance could achieve annualized return on equity (ROE) exceeding 40% for the 2025 fiscal year, in contrast to mid-20s to 30s percentages projected for other competitors in Florida. He underscored the company's potential for sustained earnings strength due to its distinctive underwriting technology.

Morgan Stanley has upgraded its recommendation for Slide Insurance from Equal-weight to Overweight, while maintaining a price target of $18.00. This rating is consistent with the overall average ratings from Wall Street analysts, who generally favor a Buy recommendation.