HCI Group (HCI) AI Stock Analysis

• Market Cap: $1.79B
• Dividend Yield: 1.03%
• Average Volume (3M): 120.42K
• Price to Earnings (P/E): 15.0
• Beta (1Y): 0.54
• Revenue Growth: 20.89%
• EPS Growth: 3.25%
• Country: US
• Employees: 552
• Sector: Financial
• Sector Strength: 78
• Industry: Insurance - Property & Casualty
• EPS (TTM): 5.35
• Shares Outstanding: 11,547,697
• 10 Day Avg. Volume: 138,599
• 30 Day Avg. Volume: 120,418
• PEG Ratio: <0.01
• Price to Book (P/B): 2.15
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -34.38
• Enterprise Value/Market Cap: 0.18
• Enterprise Value/Revenue: 0.11
• Enterprise Value/Gross Profit: 0.50
• Enterprise Value/Ebitda: 0.36
• 1Y Price Target: $206.67
• Price Target Upside: 32.75% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 78 Outperform
• Price Target: $195.00 ▲(25.26%Upside)

HCI's strong earnings call and positive technical indicators are the primary drivers of its high score. While valuation is reasonable, the negative cash flow trend poses a potential risk. Strategic initiatives, such as debt reduction and the Exio spinoff, further enhance the outlook.

Positive Factors

Growth Potential

The company is well positioned to achieve high levels of profitable growth.

Market Position

HCI's strong presence, expertise, and reputation among regulators, reinsurers, and the insurer of last resort in Florida place it in a unique position to take advantage of the high level of opportunity in the state's homeowners market.

Technology Advantage

HCI's technology is producing significantly better underwriting results than the market average, with a normalized CR of around 75% compared to higher averages in Florida and nationwide.

Negative Factors

Long-term Partnerships

Management has received several inbound inquiries from other companies interested in partnerships to use its technology, indicating potential for lucrative long-term opportunities.

Spin-off Uncertainty

The spin-off would help clear conflict-of-interest concerns as Exzeo seeks homeowners insurance customers beyond HCI, and the move could unlock significant value for HCI shareholders if Exzeo can hold its own as a standalone company.

Valuation Concerns

The stock is currently trading at 10 times our 2025 EPS estimate, which we believe does not take into account the near-term earnings growth potential.

HCI Group Business Overview & Revenue Model

Company Description

HCI Group, Inc., together with its subsidiaries, engages in the property and casualty insurance, reinsurance, real estate, and information technology businesses in Florida. It provides residential insurance products, such as homeowners, fire, flood, and wind-only insurance to homeowners, condominium owners, and tenants for properties, as well as offers reinsurance programs. The company also owns and operates waterfront properties and retail shopping centers, and an office building, as well as commercial properties for investment purposes. In addition, it designs and develops web-based applications and products for mobile devices, including SAMS, an online policy administration platform; Harmony, a policy administration platform; ClaimColony, an end-to-end claims management platform; and AtlasViewer, a mapping and data visualization platform. The company was formerly known as Homeowners Choice, Inc. and changed its name to HCI Group, Inc. in May 2013. HCI Group, Inc. was incorporated in 2006 and is headquartered in Tampa, Florida.

How the Company Makes Money

HCI Group generates revenue through multiple streams, primarily driven by its property and casualty insurance segment. This involves underwriting insurance policies and collecting premiums from policyholders, which serves as the main income source. Additionally, HCI capitalizes on its technology services, offering IT solutions to businesses, which contributes to its earnings through service fees and contracts. The company's real estate ventures also add to its revenue by leasing or selling properties and earning rental income. Strategic partnerships and acquisitions in these sectors further bolster HCI's financial performance by expanding its market reach and operational capabilities.

HCI Group Financial Statement Overview

Summary

HCI's financial performance shows strong revenue growth and improved profitability, but concerns arise from negative operating cash flow and declining free cash flow, which could impact future operations. The balance sheet is stable with moderate leverage.

Income Statement

The income statement shows strong revenue growth with a notable increase from $550.67 million in 2023 to $750.05 million in 2024, representing a growth rate of 36.14%. The gross profit margin stands at a solid 100% due to the company's revenue equating to gross profit. The net profit margin improved significantly to 17.00%, indicating enhanced profitability. However, the absence of EBITDA in 2024 suggests a potential area of concern in operational efficiency.

Balance Sheet

The balance sheet highlights a high debt-to-equity ratio of 0.41, suggesting moderate leverage that is manageable but could pose risks if liabilities continue to rise. The return on equity is healthy at 28.13%, reflecting effective utilization of shareholder funds. However, the equity ratio of 60.11% suggests a solid capital structure, indicating strong financial stability.

Cash Flow

Cash flow analysis reveals a concerning trend with operating cash flow turning negative in 2024, contrasting sharply with positive cash flows in previous years. The free cash flow growth rate is also negative, reflecting decreased liquidity. The operating cash flow to net income ratio is negative, indicating a disconnect between reported earnings and cash generation.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
759.36M	749.45M	550.67M	496.45M	407.92M	274.08M
	Gross Profit
658.46M	749.45M	528.04M	471.47M	386.07M	260.28M
	EBIT
284.98M	186.77M	474.17M	-64.68M	-600.00K	35.07M
	EBITDA
218.16M	186.77M	136.95M	-52.64M	340.64M	57.41M
	Net Income Common Stockholders
132.03M	109.95M	79.03M	-54.60M	7.24M	27.58M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
0.00	1.05B	770.50M	718.76M	671.53M	503.06M
	Total Assets
0.00	754.20M	1.81B	1.80B	1.18B	941.31M
	Total Debt
185.33M	186.44M	209.90M	212.41M	62.71M	184.28M
	Net Debt
185.33M	-346.03M	-326.57M	-22.45M	-566.24M	-247.07M
	Total Liabilities
1.76B	1.76B	1.39B	1.55B	762.40M	740.18M
	Stockholders Equity
522.68M	453.33M	324.84M	162.60M	323.37M	201.14M
Cash Flow		Free Cash Flow
311.56M	327.76M	225.50M	-10.15M	93.19M	70.87M
	Operating Cash Flow
312.50M	335.41M	230.66M	-12.00K	96.50M	77.31M
	Investing Cash Flow
47.58M	-260.11M	4.27M	-434.54M	36.85M	143.22M
	Financing Cash Flow
-16.92M	-75.17M	67.12M	41.07M	64.30M	-16.70M

HCI Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 155.68
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HCI, the sentiment is Positive. The current price of 155.68 is below the 20-day moving average (MA) of 163.86, above the 50-day MA of 154.21, and above the 200-day MA of 126.07, indicating a neutral trend. The MACD of 0.80 indicates Positive momentum. The RSI at 44.35 is Neutral, neither overbought nor oversold. The STOCH value of 12.73 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HCI.

HCI Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HCI	78 Outperform	$1.79B	14.97	28.75%	1.03%	20.89%	3.25%
NIC	78 Outperform	$1.79B	14.13	11.47%	1.08%	10.78%	28.31%
CUBI	74 Outperform	$1.67B	13.04	8.14%	―	-5.61%	-44.11%
FCF	70 Outperform	$1.67B	11.81	9.91%	3.40%	6.42%	-15.95%
Sector *	64 Neutral	$12.93B	9.70	7.85%	78.03%	12.07%	-7.83%
FBNC	63 Neutral	$1.73B	19.74	6.03%	2.11%	-2.00%	-23.83%
CLBK	48 Neutral	$1.50B	97.23	-0.15%	―	4.29%	-109.93%

HCI Group Corporate Events

HCI Group Secures Comprehensive Reinsurance Program

HCI Group has secured a comprehensive reinsurance program for its subsidiaries and sponsored reciprocal insurers for the 2025-2026 treaty year, covering risks from hurricanes, tornados, and other catastrophes. The program involves three reinsurance towers, each tailored to specific regions and perils, with participation from multiple private reinsurers and the Florida Hurricane Catastrophe Fund. This strategic move ensures adequate coverage for catastrophic losses and reflects HCI’s proactive approach to risk management, potentially strengthening its market position and providing reassurance to stakeholders.

The most recent analyst rating on (HCI) stock is a Buy with a $205.00 price target. To see the full list of analyst forecasts on HCI Group stock, see the HCI Stock Forecast page.

HCI Group Director Lauren Valiente Steps Down

On April 9, 2025, Lauren Valiente, a director at HCI Group, informed the chairman of the board of directors that she will not seek reelection. This decision marks a significant change in the board’s composition, potentially impacting the company’s governance and strategic direction.