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 143 industry peers in the Insurance industry. HCI scores excellent on profitability, but there are some minor concerns on its financial health. HCI has both an excellent growth and valuation score. This means it is growing and it is still cheap. This is a rare combination! With these ratings, HCI could be worth investigating further for value and growth investing!.
1. Profitability
1.1 Basic Checks
HCI had positive earnings in the past year.
HCI had a positive operating cash flow in the past year.
Of the past 5 years HCI 4 years were profitable.
Of the past 5 years HCI 4 years had a positive operating cash flow.
1.2 Ratios
HCI has a Return On Assets of 7.48%. This is amongst the best in the industry. HCI outperforms 95.10% of its industry peers.
Looking at the Return On Equity, with a value of 32.99%, HCI belongs to the top of the industry, outperforming 98.60% 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 94.41% 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's Profit Margin of 22.63% is amongst the best of the industry. HCI outperforms 93.71% of its industry peers.
HCI's Profit Margin has improved in the last couple of years.
HCI has a Operating Margin of 38.04%. This is amongst the best in the industry. HCI outperforms 96.50% of its industry peers.
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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), HCI is creating some value.
Compared to 1 year ago, HCI has more shares outstanding
HCI has more shares outstanding than it did 5 years ago.
HCI has a better debt/assets ratio than last year.
2.2 Solvency
HCI has an Altman-Z score of 1.52. This is a bad value and indicates that HCI is not financially healthy and even has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.52, HCI belongs to the top of the industry, outperforming 85.31% of the companies in the same industry.
The Debt to FCF ratio of HCI is 0.74, which is an excellent value as it means it would take HCI, only 0.74 years of fcf income to pay off 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 74.83% of its industry peers.
A Debt/Equity ratio of 0.43 indicates that HCI is not too dependend on debt financing.
The Debt to Equity ratio of HCI (0.43) is worse than 62.24% of its industry peers.
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 | 1.52 |
ROIC/WACC1.14
WACC8.59%
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.
The Current ratio of HCI (0.03) is better than 63.64% of its industry peers.
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 63.64% 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.
The Revenue has grown by 21.25% in the past year. This is a very strong growth!
HCI shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 25.22% yearly.
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 Y82.25%
EPS Next 2Y33.04%
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
HCI is valuated correctly with a Price/Earnings ratio of 15.07.
HCI's Price/Earnings ratio is in line with the industry average.
HCI's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.55.
The Price/Forward Earnings ratio is 10.12, which indicates a very decent valuation of HCI.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HCI is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of HCI to the average of the S&P500 Index (22.40), we can say HCI is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.07 | ||
| Fwd PE | 10.12 |
4.2 Price Multiples
83.92% of the companies in the same industry are more expensive than HCI, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, HCI is valued a bit cheaper than 66.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 5.82 | ||
| EV/EBITDA | 4.13 |
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.
HCI has a very decent profitability rating, which may justify a higher PE ratio.
HCI's earnings are expected to grow with 27.19% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.18
PEG (5Y)0.66
EPS Next 2Y33.04%
EPS Next 3Y27.19%
5. Dividend
5.1 Amount
HCI has a yearly dividend return of 0.95%, which is pretty low.
Compared to an average industry Dividend Yield of 3.10, HCI is paying slightly less dividend.
With a Dividend Yield of 0.95, HCI pays less dividend than the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.95% |
5.2 History
The dividend of HCI has a limited annual growth rate of 0.17%.
HCI has paid a dividend for at least 10 years, which is a reliable track record.
HCI has not decreased their dividend for at least 10 years, which is a reliable track record.
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.
HCI's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP9.81%
EPS Next 2Y33.04%
EPS Next 3Y27.19%
154.79
-1.09 (-0.7%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners90.68%
Inst Owner Change2.99%
Ins Owners17.54%
Ins Owner Change0%
Market Cap1.79B
Analysts84
Price Target206.55 (33.44%)
Short Float %13.44%
Short Ratio8.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.95% |
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)27.96%
PT rev (3m)32.57%
EPS NQ rev (1m)-1.13%
EPS NQ rev (3m)18.23%
EPS NY rev (1m)3.47%
EPS NY rev (3m)17.6%
Revenue NQ rev (1m)-1.06%
Revenue NQ rev (3m)-4.14%
Revenue NY rev (1m)0.59%
Revenue NY rev (3m)0.79%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.07 | ||
| Fwd PE | 10.12 | ||
| P/S | 2.35 | ||
| P/FCF | 5.82 | ||
| P/OCF | 5.73 | ||
| P/B | 3.42 | ||
| P/tB | 3.45 | ||
| EV/EBITDA | 4.13 |
EPS(TTM)10.27
EY6.63%
EPS(NY)15.29
Fwd EY9.88%
FCF(TTM)26.58
FCFY17.17%
OCF(TTM)27
OCFY17.44%
SpS65.95
BVpS45.25
TBVpS44.86
PEG (NY)0.18
PEG (5Y)0.66
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 | 1.52 |
F-Score7
WACC8.59%
ROIC/WACC1.14
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 Y82.25%
EPS Next 2Y33.04%
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%