Piper Jaffray Neutral on Selective Insurance

Piper Jaffray is out with a research report on Selective Insurance SIGI and it has a Neutral rating and a $19 price target. In a note to clients, Piper Jaffray writes, "This morning, Selective announced the acquisition of Montpelier U.S. Insurance Company, an E&S lines subsidiary of Montpelier Re. With the transaction, SIGI gains a nationally licensed platform to grow their E&S business, leveraging the company's recent renewal rights deal with Alterra. The purchase price equates to ~$55M with consideration paid entirely in cash. We view the acquisition positively given the attractive valuation and strategic value to Selective. We maintain our Neutral rating on the shares as we continue to expect underwriting margin compression going forward." Shares of SIGI are up 15 cents to $13.85, a gain of 1.09%.