Progressive's (PGR) rating and price target have been raised by Morgan Stanley analysts, who said in a note to clients Friday that the insurance major's recent share price decline "represents a reset on valuation and thesis."

Although the insurance industry is experiencing challenging growth, with some firms seeing auto premiums decline, Progressive has premium growth that, while slowing, is "notably better" than the rest of the sector, the analysts said.

Progressive's growth is likely to remain structurally better than rivals given its flexibility between bundled and mono-line auto businesses, the analysts said, noting that some carriers have over-emphasized the home and auto bundling, which can restrict growth.

Morgan Stanley raised its rating on Progressive to equal-weight from underweight, and boosted its price target on the stock to $210 per share from $190.

Price: 211.26, Change: +4.19, Percent Change: +2.02