Arch Capital price target lowered to $136 from $143 at BofA

BofA lowered the firm’s price target on Arch Capital (ACGL) to $136 from $143 and keeps a Buy rating on the shares. The firm is e decreasing its EPS forecast modestly due to the higher dividend causing a dip in investment income compared with its prior outlook, but notes that the lower capital base down can help to maintain operating ROE, which it estimates at 17% across 2024-2026. With inflation an increasing concern following the U.S. election, liability sensitive balance sheets run an increased risk and the firm thinks a smaller premium to the peer multiple is “arguably more merited,” the analyst added.