Goosehead Insurance's fair value estimate has been revised downward to $93.70 from $98.10. Analysts cite lower renewal commission retention, increased investment-related expenses, and reduced revenue growth and profit margin projections following recent price target cuts.

Analyst Commentary

Recent analyst updates for Goosehead Insurance reflect a cautious yet balanced outlook, with a mixture of optimism regarding the company’s long-term execution and concerns around near-term headwinds impacting growth and profitability. Below, key bullish and bearish perspectives are summarized based on the latest research notes and coverage initiations.

• Some analysts remain confident in Goosehead’s positioning within the personal lines insurance brokerage sector. They highlight its potential to outperform peers even as market conditions soften.
• Goosehead continues to earn Overweight ratings in the sector. Certain analysts have initiated coverage at comparatively high price targets, indicating expectations of sustainable long-term growth.
• Despite the challenging pricing environment, there is optimism around the company's strategy of investing for future gains, which is expected to support strong sales growth and market share expansion over time.
• Even as the broader property and casualty sector enters a transition period, Goosehead’s business model is viewed as resilient and less sensitive to cyclical fluctuations compared to direct underwriters.

• Several analysts have recently lowered price targets, citing weaker-than-expected Q3 results and revised projections for revenue growth and profit margins over the coming years.
• Concerns are being raised about lower renewal commission retention rates, which could weigh on profitability if not addressed through operational improvements.
• Higher investment-related expenses, as discussed on recent earnings calls, are anticipated to put pressure on margins in the near term and may impact earnings forecasts through at least 2026.
• New sales growth is being modeled at mid-teen percentages, which trails consensus expectations and suggests some execution risk in 2024 and beyond.

What's in the News

• Truist lowered its price target for Goosehead Insurance from $85 to $72 and maintained a Hold rating, citing a Q3 earnings miss, a trimmed long-term EPS forecast, and an additional $8 million in projected expenses from new investments (Periodicals).
• Goosehead Insurance repurchased 685,000 shares between July and September 2025, completing a buyback totaling 691,000 shares for $59.19 million as part of a program announced in April 2025 (Key Developments).
• Goosehead expanded its strategic franchise arrangement with Nan & Company Properties, creating Altivo Insurance. This move streamlines access to home insurance within real estate transactions in the Houston market and enhances service for luxury real estate clients (Key Developments).

Valuation Changes

• Fair Value Estimate: Decreased to $93.70 from $98.10. This change reflects recent revisions to outlook and financial projections.
• Discount Rate: Remained unchanged at 6.776%. This indicates no adjustment to the risk profile or cost of capital assumptions.
• Revenue Growth: Lowered modestly to 19.27% from 20.49%. This suggests a tempered view on future top-line expansion.
• Net Profit Margin: Reduced to 11.75% from 12.62%. This points to expectations of slightly diminished profitability.
• Future P/E: Declined to 42.13x from 44.46x. This indicates a marginally less robust earnings multiple for projection purposes.