HCI GROUP INC (HCI) Stock Fundamental Analysis
NYSE:HCI - New York Stock Exchange, Inc. - US40416E1038 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to HCI. HCI was compared to 144 industry peers in the Insurance industry. While HCI has a great profitability rating, there are some minor concerns on its financial health. An interesting combination arises when we look at growth and value: HCI is growing strongly while it also seems undervalued. This makes HCI very considerable for value and growth investing!
1. Profitability
1.1 Basic Checks
In the past year HCI was profitable.
HCI had a positive operating cash flow in the past year.
HCI had positive earnings in 4 of the past 5 years.
HCI had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 7.48%, HCI belongs to the best of the industry, outperforming 94.44% of the companies in the same industry.
Looking at the Return On Equity, with a value of 32.99%, HCI belongs to the top of the industry, outperforming 97.92% of the companies in the same industry.
HCI has a Return On Invested Capital of 9.82%. This is amongst the best in the industry. HCI outperforms 94.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.48% | ||
| ROE | 32.99% | ||
| ROIC | 9.82% |
ROA(3y)1.97%
ROA(5y)1.77%
ROE(3y)4.34%
ROE(5y)5.31%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
HCI has a Profit Margin of 22.63%. This is amongst the best in the industry. HCI outperforms 93.06% of its industry peers.
HCI's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 38.04%, HCI belongs to the top of the industry, outperforming 96.53% of the companies in the same industry.
In the last couple of years the Operating Margin of HCI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 38.04% | ||
| PM (TTM) | 22.63% | ||
| GM | N/A |
OM growth 3Y83.48%
OM growth 5Y3.9%
PM growth 3Y215.92%
PM growth 5Y6.5%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so HCI is still creating some value.
HCI has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, HCI has more shares outstanding
Compared to 1 year ago, HCI has an improved debt to assets ratio.
2.2 Solvency
HCI has an Altman-Z score of 1.48. This is a bad value and indicates that HCI is not financially healthy and even has some risk of bankruptcy.
With an excellent Altman-Z score value of 1.48, HCI belongs to the best of the industry, outperforming 84.72% of the companies in the same industry.
HCI has a debt to FCF ratio of 0.74. This is a very positive value and a sign of high solvency as it would only need 0.74 years to pay back of all of its debts.
HCI has a Debt to FCF ratio of 0.74. This is in the better half of the industry: HCI outperforms 75.00% of its industry peers.
A Debt/Equity ratio of 0.43 indicates that HCI is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.43, HCI is not doing good in the industry: 62.50% of the companies in the same industry are doing better.
Although HCI does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | 0.74 | ||
| Altman-Z | 1.48 |
ROIC/WACC1.05
WACC9.33%
2.3 Liquidity
HCI has a Current Ratio of 0.03. This is a bad value and indicates that HCI is not financially healthy enough and could expect problems in meeting its short term obligations.
With a decent Current ratio value of 0.03, HCI is doing good in the industry, outperforming 63.89% of the companies in the same industry.
HCI has a Quick Ratio of 0.03. This is a bad value and indicates that HCI is not financially healthy enough and could expect problems in meeting its short term obligations.
HCI has a better Quick ratio (0.03) than 63.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.03 | ||
| Quick Ratio | 0.03 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 8.11% over the past year.
HCI shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 22.91% yearly.
HCI shows a strong growth in Revenue. In the last year, the Revenue has grown by 21.25%.
Measured over the past years, HCI shows a very strong growth in Revenue. The Revenue has been growing by 25.22% on average per year.
EPS 1Y (TTM)8.11%
EPS 3Y342.08%
EPS 5Y22.91%
EPS Q2Q%44.66%
Revenue 1Y (TTM)21.25%
Revenue growth 3Y22.37%
Revenue growth 5Y25.22%
Sales Q2Q%4.75%
3.2 Future
The Earnings Per Share is expected to grow by 20.02% on average over the next years. This is a very strong growth
Based on estimates for the next years, HCI will show a quite strong growth in Revenue. The Revenue will grow by 10.48% on average per year.
EPS Next Y78.23%
EPS Next 2Y34.57%
EPS Next 3Y27.19%
EPS Next 5Y20.02%
Revenue Next Year17.27%
Revenue Next 2Y10.48%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 14.16, HCI is valued correctly.
The rest of the industry has a similar Price/Earnings ratio as HCI.
Compared to an average S&P500 Price/Earnings ratio of 27.28, HCI is valued a bit cheaper.
HCI is valuated reasonably with a Price/Forward Earnings ratio of 9.30.
HCI's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 21.76. HCI is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.16 | ||
| Fwd PE | 9.3 |
4.2 Price Multiples
HCI's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. HCI is cheaper than 85.42% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HCI indicates a somewhat cheap valuation: HCI is cheaper than 68.06% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 5.47 | ||
| EV/EBITDA | 3.8 |
4.3 Compensation for Growth
HCI's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of HCI may justify a higher PE ratio.
A more expensive valuation may be justified as HCI's earnings are expected to grow with 27.19% in the coming years.
PEG (NY)0.18
PEG (5Y)0.62
EPS Next 2Y34.57%
EPS Next 3Y27.19%
5. Dividend
5.1 Amount
HCI has a Yearly Dividend Yield of 1.06%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.51, HCI is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.42, HCI's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
5.2 History
The dividend of HCI has a limited annual growth rate of 0.17%.
HCI has been paying a dividend for at least 10 years, so it has a reliable track record.
HCI has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)0.17%
Div Incr Years0
Div Non Decr Years14
5.3 Sustainability
HCI pays out 9.81% of its income as dividend. This is a sustainable payout ratio.
The dividend of HCI is growing, but earnings are growing more, so the dividend growth is sustainable.
DP9.81%
EPS Next 2Y34.57%
EPS Next 3Y27.19%
145.43
-1.05 (-0.72%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners85.54%
Inst Owner Change2.99%
Ins Owners15.97%
Ins Owner Change0%
Market Cap1.68B
Analysts84
Price Target198.9 (36.77%)
Short Float %4.07%
Short Ratio2.83
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
Yearly Dividend1.62
Dividend Growth(5Y)0.17%
DP9.81%
Div Incr Years0
Div Non Decr Years14
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)59.85%
Min EPS beat(2)7.78%
Max EPS beat(2)111.92%
EPS beat(4)4
Avg EPS beat(4)53.2%
Min EPS beat(4)7.78%
Max EPS beat(4)111.92%
EPS beat(8)8
Avg EPS beat(8)137.84%
EPS beat(12)11
Avg EPS beat(12)191.27%
EPS beat(16)13
Avg EPS beat(16)107.02%
Revenue beat(2)0
Avg Revenue beat(2)-1.22%
Min Revenue beat(2)-2.17%
Max Revenue beat(2)-0.28%
Revenue beat(4)1
Avg Revenue beat(4)-1.96%
Min Revenue beat(4)-8.88%
Max Revenue beat(4)3.48%
Revenue beat(8)5
Avg Revenue beat(8)2.19%
Revenue beat(12)7
Avg Revenue beat(12)8.53%
Revenue beat(16)11
Avg Revenue beat(16)14.34%
PT rev (1m)23.22%
PT rev (3m)23.22%
EPS NQ rev (1m)-4.61%
EPS NQ rev (3m)-5.69%
EPS NY rev (1m)-2.2%
EPS NY rev (3m)1.19%
Revenue NQ rev (1m)0.22%
Revenue NQ rev (3m)-1.06%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)0.79%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.16 | ||
| Fwd PE | 9.3 | ||
| P/S | 2.21 | ||
| P/FCF | 5.47 | ||
| P/OCF | 5.39 | ||
| P/B | 3.21 | ||
| P/tB | 3.24 | ||
| EV/EBITDA | 3.8 |
EPS(TTM)10.27
EY7.06%
EPS(NY)15.65
Fwd EY10.76%
FCF(TTM)26.58
FCFY18.28%
OCF(TTM)27
OCFY18.56%
SpS65.95
BVpS45.25
TBVpS44.86
PEG (NY)0.18
PEG (5Y)0.62
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.48% | ||
| ROE | 32.99% | ||
| ROCE | 13.39% | ||
| ROIC | 9.82% | ||
| ROICexc | 14.92% | ||
| ROICexgc | 24.94% | ||
| OM | 38.04% | ||
| PM (TTM) | 22.63% | ||
| GM | N/A | ||
| FCFM | 40.3% |
ROA(3y)1.97%
ROA(5y)1.77%
ROE(3y)4.34%
ROE(5y)5.31%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y65.67%
ROICexcg growth 5Y7.68%
ROICexc growth 3Y52.3%
ROICexc growth 5Y4.65%
OM growth 3Y83.48%
OM growth 5Y3.9%
PM growth 3Y215.92%
PM growth 5Y6.5%
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover0.33
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | 0.74 | ||
| Debt/EBITDA | 0.77 | ||
| Cap/Depr | 91.03% | ||
| Cap/Sales | 0.64% | ||
| Interest Coverage | 24.5 | ||
| Cash Conversion | 105.68% | ||
| Profit Quality | 178.05% | ||
| Current Ratio | 0.03 | ||
| Quick Ratio | 0.03 | ||
| Altman-Z | 1.48 |
F-Score7
WACC9.33%
ROIC/WACC1.05
Cap/Depr(3y)84.29%
Cap/Depr(5y)77.24%
Cap/Sales(3y)1%
Cap/Sales(5y)1.23%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)8.11%
EPS 3Y342.08%
EPS 5Y22.91%
EPS Q2Q%44.66%
EPS Next Y78.23%
EPS Next 2Y34.57%
EPS Next 3Y27.19%
EPS Next 5Y20.02%
Revenue 1Y (TTM)21.25%
Revenue growth 3Y22.37%
Revenue growth 5Y25.22%
Sales Q2Q%4.75%
Revenue Next Year17.27%
Revenue Next 2Y10.48%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y62.84%
EBIT growth 3Y124.51%
EBIT growth 5Y30.1%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y757.55%
FCF growth 3Y52.08%
FCF growth 5Y45.02%
OCF growth 1Y646.94%
OCF growth 3Y50.93%
OCF growth 5Y43.78%