HERITAGE INSURANCE HOLDINGS (HRTG) Stock Fundamental Analysis
NYSE:HRTG - New York Stock Exchange, Inc. - US42727J1025 - Common Stock - Currency: USD
HRTG gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 144 industry peers in the Insurance industry. There are concerns on the financial health of HRTG while its profitability can be described as average. An interesting combination arises when we look at growth and value: HRTG is growing strongly while it also seems undervalued.
1. Profitability
1.1 Basic Checks
HRTG had positive earnings in the past year.
In the past year HRTG had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: HRTG reported negative net income in multiple years.
HRTG had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of 3.04%, HRTG is doing good in the industry, outperforming 64.08% of the companies in the same industry.
Looking at the Return On Equity, with a value of 25.84%, HRTG belongs to the top of the industry, outperforming 90.14% of the companies in the same industry.
HRTG has a Return On Invested Capital of 3.68%. This is in the better half of the industry: HRTG outperforms 71.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.04% | ||
| ROE | 25.84% | ||
| ROIC | 3.68% |
ROA(3y)-2.71%
ROA(5y)-1.24%
ROE(3y)-39.69%
ROE(5y)-22.12%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
The Profit Margin of HRTG (9.10%) is comparable to the rest of the industry.
In the last couple of years the Profit Margin of HRTG has grown nicely.
Looking at the Operating Margin, with a value of 12.38%, HRTG is in line with its industry, outperforming 54.23% of the companies in the same industry.
In the last couple of years the Operating Margin of HRTG has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.38% | ||
| PM (TTM) | 9.1% | ||
| GM | N/A |
OM growth 3Y71.69%
OM growth 5Y-9.68%
PM growth 3Y57.82%
PM growth 5Y1.69%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so HRTG is destroying value.
The number of shares outstanding for HRTG has been increased compared to 1 year ago.
Compared to 5 years ago, HRTG has more shares outstanding
The debt/assets ratio for HRTG is higher compared to a year ago.
2.2 Solvency
The Debt to FCF ratio of HRTG is 0.58, which is an excellent value as it means it would take HRTG, only 0.58 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of HRTG (0.58) is better than 75.35% of its industry peers.
A Debt/Equity ratio of 0.49 indicates that HRTG is not too dependend on debt financing.
The Debt to Equity ratio of HRTG (0.49) is worse than 67.61% of its industry peers.
Even though the debt/equity ratio score it not favorable for HRTG, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 0.58 | ||
| Altman-Z | N/A |
ROIC/WACC0.46
WACC8.01%
2.3 Liquidity
HRTG has a Current Ratio of 0.12. This is a bad value and indicates that HRTG is not financially healthy enough and could expect problems in meeting its short term obligations.
HRTG's Current ratio of 0.12 is fine compared to the rest of the industry. HRTG outperforms 65.49% of its industry peers.
HRTG has a Quick Ratio of 0.12. This is a bad value and indicates that HRTG is not financially healthy enough and could expect problems in meeting its short term obligations.
With a decent Quick ratio value of 0.12, HRTG is doing good in the industry, outperforming 65.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.12 | ||
| Quick Ratio | 0.12 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 138.10% over the past year.
The Earnings Per Share has been growing slightly by 4.35% on average over the past years.
The Revenue has grown by 9.76% in the past year. This is quite good.
Measured over the past years, HRTG shows a quite strong growth in Revenue. The Revenue has been growing by 8.90% on average per year.
EPS 1Y (TTM)138.1%
EPS 3Y75.17%
EPS 5Y4.35%
EPS Q2Q%196.43%
Revenue 1Y (TTM)9.76%
Revenue growth 3Y7.42%
Revenue growth 5Y8.9%
Sales Q2Q%13.71%
3.2 Future
The Earnings Per Share is expected to grow by 12.48% on average over the next years. This is quite good.
The Revenue is expected to grow by 8.19% on average over the next years. This is quite good.
EPS Next Y12.93%
EPS Next 2Y6.83%
EPS Next 3Y12.48%
EPS Next 5YN/A
Revenue Next Year9.94%
Revenue Next 2Y9.24%
Revenue Next 3Y8.19%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
HRTG is valuated cheaply with a Price/Earnings ratio of 4.43.
Based on the Price/Earnings ratio, HRTG is valued cheaply inside the industry as 81.69% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 29.62. HRTG is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 5.64, the valuation of HRTG can be described as very cheap.
78.87% of the companies in the same industry are more expensive than HRTG, based on the Price/Forward Earnings ratio.
HRTG's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.70.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.43 | ||
| Fwd PE | 5.64 |
4.2 Price Multiples
Based on the Price/Free Cash Flow ratio, HRTG is valued cheaper than 87.32% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 1.44 | ||
| EV/EBITDA | -0.31 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as HRTG's earnings are expected to grow with 12.48% in the coming years.
PEG (NY)0.34
PEG (5Y)1.02
EPS Next 2Y6.83%
EPS Next 3Y12.48%
5. Dividend
5.1 Amount
HRTG has a Yearly Dividend Yield of 2.84%. Purely for dividend investing, there may be better candidates out there.
HRTG's Dividend Yield is a higher than the industry average which is at 3.17.
Compared to an average S&P500 Dividend Yield of 2.27, HRTG pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.84% |
5.2 History
The dividend of HRTG decreases each year by -73.43%.
HRTG has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)-73.43%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
0.02% of the earnings are spent on dividend by HRTG. This is a low number and sustainable payout ratio.
DP0.02%
EPS Next 2Y6.83%
EPS Next 3Y12.48%
11.08
-0.7 (-5.94%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners57.28%
Inst Owner Change-91.56%
Ins Owners26.71%
Ins Owner Change-1.54%
Market Cap339.93M
Analysts80
Price Target16.32 (47.29%)
Short Float %3.03%
Short Ratio3.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.84% |
Yearly Dividend0
Dividend Growth(5Y)-73.43%
DP0.02%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)189.14%
Min EPS beat(2)44.34%
Max EPS beat(2)333.94%
EPS beat(4)3
Avg EPS beat(4)125.84%
Min EPS beat(4)-21.81%
Max EPS beat(4)333.94%
EPS beat(8)6
Avg EPS beat(8)179.63%
EPS beat(12)8
Avg EPS beat(12)147.84%
EPS beat(16)9
Avg EPS beat(16)98.73%
Revenue beat(2)1
Avg Revenue beat(2)0.18%
Min Revenue beat(2)-1.06%
Max Revenue beat(2)1.41%
Revenue beat(4)1
Avg Revenue beat(4)-0.35%
Min Revenue beat(4)-1.06%
Max Revenue beat(4)1.41%
Revenue beat(8)5
Avg Revenue beat(8)2.05%
Revenue beat(12)7
Avg Revenue beat(12)1.43%
Revenue beat(16)11
Avg Revenue beat(16)2.16%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)1005.92%
EPS NQ rev (3m)1005.92%
EPS NY rev (1m)48.93%
EPS NY rev (3m)85.07%
Revenue NQ rev (1m)-4.08%
Revenue NQ rev (3m)-4.08%
Revenue NY rev (1m)-1.04%
Revenue NY rev (3m)-1.84%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.43 | ||
| Fwd PE | 5.64 | ||
| P/S | 0.43 | ||
| P/FCF | 1.44 | ||
| P/OCF | 1.4 | ||
| P/B | 1.22 | ||
| P/tB | 1.41 | ||
| EV/EBITDA | -0.31 |
EPS(TTM)2.5
EY22.56%
EPS(NY)1.96
Fwd EY17.71%
FCF(TTM)7.68
FCFY69.35%
OCF(TTM)7.92
OCFY71.45%
SpS25.87
BVpS9.11
TBVpS7.87
PEG (NY)0.34
PEG (5Y)1.02
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.04% | ||
| ROE | 25.84% | ||
| ROCE | 4.23% | ||
| ROIC | 3.68% | ||
| ROICexc | 4.71% | ||
| ROICexgc | 9.34% | ||
| OM | 12.38% | ||
| PM (TTM) | 9.1% | ||
| GM | N/A | ||
| FCFM | 29.7% |
ROA(3y)-2.71%
ROA(5y)-1.24%
ROE(3y)-39.69%
ROE(5y)-22.12%
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 3Y78.14%
ROICexcg growth 5Y-6.49%
ROICexc growth 3Y81.14%
ROICexc growth 5Y-4.34%
OM growth 3Y71.69%
OM growth 5Y-9.68%
PM growth 3Y57.82%
PM growth 5Y1.69%
GM growth 3YN/A
GM growth 5YN/A
F-Score8
Asset Turnover0.33
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 0.58 | ||
| Debt/EBITDA | 1.28 | ||
| Cap/Depr | 80.22% | ||
| Cap/Sales | 0.9% | ||
| Interest Coverage | 10.09 | ||
| Cash Conversion | 226.61% | ||
| Profit Quality | 326.54% | ||
| Current Ratio | 0.12 | ||
| Quick Ratio | 0.12 | ||
| Altman-Z | N/A |
F-Score8
WACC8.01%
ROIC/WACC0.46
Cap/Depr(3y)48.66%
Cap/Depr(5y)40.78%
Cap/Sales(3y)0.59%
Cap/Sales(5y)0.57%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)138.1%
EPS 3Y75.17%
EPS 5Y4.35%
EPS Q2Q%196.43%
EPS Next Y12.93%
EPS Next 2Y6.83%
EPS Next 3Y12.48%
EPS Next 5YN/A
Revenue 1Y (TTM)9.76%
Revenue growth 3Y7.42%
Revenue growth 5Y8.9%
Sales Q2Q%13.71%
Revenue Next Year9.94%
Revenue Next 2Y9.24%
Revenue Next 3Y8.19%
Revenue Next 5YN/A
EBIT growth 1Y129.58%
EBIT growth 3Y84.42%
EBIT growth 5Y-1.64%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y810.03%
FCF growth 3Y-29.04%
FCF growth 5Y-8.43%
OCF growth 1Y961.31%
OCF growth 3Y-25.49%
OCF growth 5Y-6.07%