Heritage Insurance misses Q2 revenue estimates

Overview

• Heritage Insurance Q2 net income rises to $48 mln, driven by lower net loss ratio

• Revenue missed analyst expectations, despite strategic initiatives boosting profitability

• Co suspends quarterly dividend to prioritize strategic growth

Result Drivers

• UNDERWRITING DISCIPLINE - Improved net loss ratio attributed to disciplined underwriting and rate adequacy, per CEO Ernie Garateix

• EXPANSION - Reopening of profitable geographies led to 46.3% increase in new business premium compared to last year

• STRATEGIC INITIATIVES - Focus on rate adequacy and selective underwriting contributed to improved earnings trajectory

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the property & casualty insurance peer group is "buy"

• Wall Street's median 12-month price target for Heritage Insurance Holdings Inc is $29.00, about 26.9% above its August 4 closing price of $21.21

• The stock recently traded at 6 times the next 12-month earnings vs. a P/E of 7 three months ago

Press Release: ID:nPn3Jfwqwa