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American Coastal Insurance Corporation (ACIC)
:ACIC
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American Coastal Insurance
(NASDAQ:ACIC)
46Neutral
American Coastal Insurance (ACIC) vs. S&P 500 (SPY)
Market Cap
$561.13M
Dividend YieldN/A
Average Volume (3M)170.20K
Price to Earnings (P/E)7.4
Beta (1Y)0.78
Revenue Growth1.00%
EPS Growth-77.16%
CountryUS
Employees65
SectorFinancial
Sector Strength81
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)1.57
Shares Outstanding48,248,630
10 Day Avg. Volume180,075
30 Day Avg. Volume170,200
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.94
Price to Cash Flow (P/CF)89.80
P/FCF Ratio46.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$16.00Price Target Upside37.58% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering0
American Coastal Insurance Business Overview & Revenue Model
Company DescriptionAmerican Coastal Insurance Corporation operates as a property and casualty insurance holding company that sources, writes, and services residential personal and commercial property, and casualty insurance policies in the United States. The company offers structure, content, and liability coverage for standard single-family homeowners, renters, and condominium unit owners. It also provides commercial multi-peril property insurance for residential condominium associations and apartments, as well as loss or damage to buildings, inventory, and equipment caused by fire, wind, hail, water, theft, and vandalism. In addition, the company offers equipment breakdown, identity theft, cyber security, and flood policies. The company markets and distributes its products through a network of independent agencies. The company was formerly known as United Insurance Holdings Corp. and changed its name to American Coastal Insurance Corporation in August 2023. American Coastal Insurance Corporation was founded in 1999 and is headquartered in Saint Petersburg, Florida.
How the Company Makes MoneyACIC makes money through the premiums collected from its policyholders. These premiums are determined based on the risk assessments of insuring properties in coastal areas, which are influenced by factors such as location, property value, and susceptibility to natural disasters. The company employs underwriters to evaluate these risks and set premium rates accordingly. Additionally, ACIC invests the premiums it collects into various financial instruments to generate investment income, further contributing to its revenue. The company may also engage in reinsurance agreements to mitigate risk exposure, sharing premiums with reinsurance partners while reducing potential liabilities. These strategic financial operations and partnerships are critical in maintaining ACIC's profitability and stability in a high-risk insurance market.
American Coastal Insurance Financial Statement Overview
Summary
American Coastal Insurance faces significant financial challenges, including declining revenue trends and consistent negative income metrics. Despite some equity improvement, high leverage and operational inefficiencies in cash flow persist, impacting financial stability.Income Statement
American Coastal Insurance has experienced a significant decline in Total Revenue from 2019 to 2024, with revenue dropping to zero in 2024. The company has consistently struggled to maintain profitability as indicated by negative EBIT and EBITDA values over multiple years. These trends highlight challenges in generating and maintaining revenue streams, severely impacting profitability.20
Very Negative
Balance Sheet
The company's balance sheet reflects a high degree of leverage with a Debt-to-Equity Ratio indicating potential financial risks. However, the equity levels have shown some recovery in 2024, improving from negative equity in 2022. The company's Total Assets have generally declined, which may affect future growth potential.40
Negative
Cash Flow
American Coastal Insurance has faced continuous negative Free Cash Flow, suggesting challenges in generating cash from operations. The Operating Cash Flow to Net Income Ratio remains negative, indicating operational inefficiencies. Although there was a significant financing inflow in 2024, cash flow from operations remains poor.30
Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 0.00 | 286.54M | 455.42M | 634.53M | 846.66M | Gross Profit |
| 0.00 | 286.54M | 455.42M | 634.53M | 846.66M | EBIT |
| -509.70M | 246.81M | -459.97M | -106.10M | -229.89K | EBITDA |
| 0.00 | 107.69M | 1.95M | 10.32M | -111.81M | Net Income Common Stockholders |
| 75.72M | 309.91M | -468.00M | -57.92M | -131.31K |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 834.50M | 153.76M | 606.36M | 875.63M | 1.18B | Total Assets |
| 1.00B | 1.06B | 2.84B | 2.70B | 2.85B | Total Debt |
| 79.00M | 149.46M | 154.16M | 158.50M | 160.35M | Net Debt |
| 15.31M | -4.30M | -75.73M | -53.53M | -79.07M | Total Liabilities |
| 248.60M | 891.62M | 3.02B | 2.37B | 2.43B | Stockholders Equity |
| 752.60M | 168.76M | -180.18M | 312.41M | 395.75M |
| Cash Flow | Free Cash Flow | |||
| -450.60M | -136.20M | -176.16M | -300.66M | -21.32M | Operating Cash Flow |
| -368.60M | -136.00M | -173.11M | -295.39M | -10.47M | Investing Cash Flow |
| -82.00M | -2.54M | 236.84M | 251.38M | 36.57M | Financing Cash Flow |
| 820.40M | 26.77M | -25.39M | -12.21M | -11.65M |
American Coastal Insurance Technical Analysis
Negative
11.63
Price Trends
12.20
Negative
12.48
Negative
11.56
Positive
Market Momentum
-0.16
Positive
42.67
Neutral
27.68
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ACIC, the sentiment is Negative. The current price of 11.63 is below the 20-day moving average (MA) of 11.98, below the 50-day MA of 12.20, and above the 200-day MA of 11.56, indicating a neutral trend. The MACD of -0.16 indicates Positive momentum. The RSI at 42.67 is Neutral, neither overbought nor oversold. The STOCH value of 27.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ACIC.
American Coastal Insurance Risk Analysis
American Coastal Insurance disclosed 30 risk factors in its most recent earnings report. American Coastal Insurance reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
American Coastal Insurance Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $59.46B | 12.09 | 18.94% | 1.60% | 12.23% | 68.50% | |
72 Outperform | $55.46B | 12.25 | 23.80% | 1.76% | 12.28% | ― | |
72 Outperform | $1.59B | 16.35 | 28.26% | 1.10% | 36.21% | 18.17% | |
71 Outperform | $49.95B | 16.57 | 7.10% | 1.85% | -28.56% | 1.14% | |
64 Neutral | $14.53B | 10.25 | 8.67% | 4.22% | 16.51% | -12.20% | |
46 Neutral | $561.13M | 7.42 | 37.69% | ― | 1.00% | -77.16% |
* Financial Sector Average
Performance Comparison
ACIC
American Coastal Insurance
11.63
1.34
13.02%
ALL
Allstate
209.29
39.69
23.40%
AIG
American International Group
84.42
7.89
10.31%
TRV
Travelers Companies
262.68
36.55
16.16%
HCI
HCI Group
148.13
33.78
29.54%
American Coastal Insurance Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: -8.35% | Next Earnings Date: May 7, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong growth in revenue, successful launch of a new apartment program, and enhanced reinsurance protections, demonstrating resilience and strategic advancement. However, the impact of Hurricane Milton and increased operating expenses posed challenges. Overall, the highlights indicate a positive outlook with manageable lowlights.Highlights
New Apartment Program Launch
American Coastal launched a new apartment program in Florida, writing 19 new apartment risks totaling $2.3 million of premium, indicating early success in diversifying their risk portfolio.
Revenue and Growth Metrics
Total revenues grew nearly 55% year-over-year in Q4, supported by better-than-expected new business growth and renewal account retention.
Enhanced Reinsurance Protections
The company placed a new three-year catastrophe bond, increasing from $100 million to $200 million, priced below the expected range, and introduced a cascading feature for multiple hurricane events.
Strong Financial Performance
Pre-tax income for the full year 2024 was approximately $102 million, up nearly 6% year-over-year, despite $23 million more in net catastrophe losses.
Increased Stockholders' Equity
The company starts 2025 with approximately $236 million of stockholders' equity, a 39.6% increase, showcasing strong capitalization.
Lowlights
Impact of Hurricane Milton
Despite being profitable, the full retention loss from Hurricane Milton affected the quarter, contributing to a combined ratio of 91.9%.
Increased Operating Expenses
Operating expenses increased by $15.1 million, driven by a $13.4 million rise in policy acquisition costs and increased general and administrative expenses.
Decreased Core Income
Core income decreased by $12 million year-over-year due to tax retention from Hurricane Milton, despite other positive financial metrics.
Company Guidance
During the American Coastal Insurance Corporation's fourth-quarter 2024 earnings call, the company provided guidance for 2025, emphasizing several key metrics and strategic initiatives. Despite a full retention loss from Hurricane Milton, the company remained profitable, with a pre-tax income of approximately $102 million for the full year, up nearly 6% year-over-year. In Q4, total revenues grew nearly 55% year-over-year due to retaining more business and reducing the quota share. The company launched a new apartment program in Florida, writing 19 new apartment risks totaling approximately $2.3 million in premium. American Coastal also enhanced its reinsurance protections, placing a new three-year catastrophe bond upsized to $200 million, which includes a cascading feature for multiple hurricane events. The company successfully renewed its All Other Perils (AOPCAT) and Excess Per Risk reinsurance programs, reducing retention levels significantly. For 2025, American Coastal expects a net income range between $70 million and $90 million, with an anticipated return on beginning equity of over 30%. The company starts 2025 with approximately $236 million of stockholders' equity and remains focused on underwriting profit as its primary business objective.American Coastal Insurance Corporate Events
M&A TransactionsBusiness Operations and Strategy
American Coastal Insurance Announces Strategic Transformation
Neutral
Mar 3, 2025
American Coastal Insurance Corporation announced its strategic transformation, focusing on its profitable commercial lines and divesting from its struggling personal lines business. The company aims to enhance its market positioning by increasing rates, reducing exposure, and leveraging its exclusive partnership with AmRisc, while maintaining strong reinsurance support to manage catastrophe risks.
Financial Disclosures
American Coastal Insurance Reports Significant Income Decline
Negative
Feb 27, 2025
American Coastal Insurance Corporation reported its financial results for the fourth quarter and year ended December 31, 2024. The company experienced a decline in consolidated net income, which fell by 65.4% compared to the previous year, despite an increase in gross premiums written and earned. The results indicate challenges in maintaining profitability, impacting stakeholders’ expectations.
Executive/Board ChangesBusiness Operations and Strategy
American Coastal Insurance Announces Leadership Transition
Positive
Feb 12, 2025
American Coastal Insurance Corporation announced a leadership transition effective February 11, 2025. B. Bradford Martz has been appointed as the new Chief Executive Officer while retaining his position as President, a role he has held since July 2020. Mr. Martz, previously Chief Financial Officer, is expected to enhance ACIC’s market position and shareholder value. Concurrently, R. Daniel Peed will transition to Executive Chairman of the Board of Directors, focusing on strategic guidance and long-term growth. The company also approved increases in Mr. Martz’s compensation, reflecting his expanded responsibilities.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.