UPDATE: Keefe, Bruyette & Woods Reiterates on Radian Group on Adjusted Long-Term Estimates

In a report published Tuesday, Keefe, Bruyette & Woods analyst Bose George reiterated an Outperform rating on Radian Group (NYSE: RDN), and raised the price target from $17.00 to $18.50.

In the report, Keefe, Bruyette & Woods noted, “We are increasing our price targets for RDN and MTG to incorporate a higher P/E multiple on our normalized EPS estimates. We are also lowering the discount rate we use to present value our normalized EPS estimates to 10% from 11%. We take our target for RDN to $18.50 from $17 and our target for MTG to $10 from $9. We upgrade MTG to Outperform from Market Perform on valuation as our new price target equates to roughly 23% of upside in the shares. We are also adjusting our longer-term (2016-2018) estimates for RDN to incorporate dilution from its outstanding converts and lower loss ratios.”

Radian Group closed on Monday at $14.74.