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American Coastal Insurance (ACIC)
NASDAQ:ACIC
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American Coastal Insurance
(NASDAQ:ACIC)
Rating:56Neutral
Price Target:
$12.50
▲(6.38%Upside)
American Coastal Insurance (ACIC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$578.31M
Dividend YieldN/A
Average Volume (3M)219.04K
Price to Earnings (P/E)7.8
Beta (1Y)0.48
Revenue Growth12.19%
EPS Growth5.12%
CountryUS
Employees65
SectorFinancial
Sector Strength83
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)0.42
Shares Outstanding48,353,413
10 Day Avg. Volume276,802
30 Day Avg. Volume219,037
Financial Highlights & Ratios
PEG Ratio0.42
Price to Book (P/B)2.27
Price to Sales (P/S)0.00
P/FCF Ratio2.21
Enterprise Value/Market Cap0.96
Enterprise Value/Revenue0.50
Enterprise Value/Gross ProfitN/A
Enterprise Value/Ebitda1.20
Forecast
1Y Price Target
$15.00Price Target Upside27.66% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
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 Earnings Call Summary
Earnings Call Date:May 08, 2025
(Q1-2025)
| % Change Since: -1.43%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong performance in the first quarter with significant growth in premiums, improved financial metrics, and enhanced reinsurance program. Despite some increased costs and competitive market challenges, the positive aspects, including strong equity growth and reduced reinsurance rates, outweigh the negatives.Q1-2025 Updates
Positive Updates
Strong First Quarter Performance
American Coastal achieved a target combined ratio of 65% and a core return on equity of over 34%.
Growth in Policies and Premiums
Policies in-force grew approximately 6% since year-end, with gross premiums written increasing by over 7% year-over-year.
Reinsurance Program Improvements
The core catastrophe reinsurance program renewal is 100% placed except for a new top layer, increasing first event limit by approximately 16% and aggregate protection by about 32% year-over-year.
Decrease in Risk-Adjusted Reinsurance Rate
Risk-adjusted reinsurance rate decreased estimated at approximately 12%, with variations between layers from 10% to 22%.
Strong Financial Metrics
Net income for the first quarter was $21.3 million, with net premium earned growing by 9% to $68.3 million.
Improved Cash Position
Cash investments grew by 5.2% to $540.8 million, bolstered by higher-than-expected proceeds from the Interboro sale.
Increase in Stockholders’ Equity
Stockholders’ equity increased by 10.7% to $260.9 million, with a 10.4% increase in book value per share from year-end 2024.
Negative Updates
Decrease in Core Income
Core income decreased by $3.7 million year-over-year due to increased policy acquisition costs.
Increased Operating Expenses
Operating expenses increased by $12.1 million, primarily due to a 144.8% increase in policy acquisition costs.
Competitive Apartment Market
The apartment market is more competitive than expected, limiting hyper-growth opportunities.
Company Guidance
During the first quarter of fiscal year 2025, American Coastal Insurance Corporation achieved several key metrics that highlight its strong performance. The company reported a target combined ratio of 65% and a core return on equity exceeding 34%. It saw a 6% growth in policies in-force since year-end, with premiums totaling approximately $661 million as of March 31, 2025. Gross premiums written increased by over 7% compared to the previous year, supported by a renewal account retention rate of 88%. The company's catastrophe reinsurance program, effective June 1, 2025, is projected to increase its first event limit by approximately 16%, from $1.16 billion to around $1.35 billion, and aggregate protection for multiple events is expected to rise by about 32%. Additionally, the first event retention is anticipated to increase from approximately $20.5 million to $29.75 million. The risk-adjusted reinsurance rate decreased by approximately 12%, with variations across layers ranging from 10% to 22%. Overall, the company is well-positioned to continue its growth initiatives in 2025, supported by a 10.7% increase in stockholders’ equity and a book value per share growth of 10.4% from the previous year-end.American Coastal Insurance Financial Statement Overview
Summary
American Coastal Insurance faces significant challenges in revenue generation and profitability, with a declining revenue trend and consistent negative income metrics. The balance sheet shows high leverage, although there is some improvement in equity levels. Cash flow analysis indicates ongoing operational struggles.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 | |||
| 296.66M | 286.54M | 455.42M | 634.53M | 846.66M | Gross Profit |
| 296.66M | 286.54M | 455.42M | 634.53M | 846.66M | EBIT |
| 111.59M | 246.81M | -459.97M | -106.10M | -229.89K | EBITDA |
| 113.66M | 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 | |||
| 285.04M | 153.76M | 606.36M | 875.63M | 1.18B | Total Assets |
| 1.22B | 1.06B | 2.84B | 2.70B | 2.85B | Total Debt |
| 152.34M | 149.46M | 154.16M | 158.50M | 160.35M | Net Debt |
| 15.31M | -4.30M | -75.73M | -53.53M | -79.07M | Total Liabilities |
| 980.45M | 891.62M | 3.02B | 2.37B | 2.43B | Stockholders Equity |
| 235.66M | 168.76M | -180.18M | 312.41M | 395.75M |
| Cash Flow | Free Cash Flow | |||
| 243.49M | -136.20M | -176.16M | -300.66M | -21.32M | Operating Cash Flow |
| 243.51M | -136.00M | -173.11M | -295.39M | -10.47M | Investing Cash Flow |
| -179.21M | -2.54M | 236.84M | 251.38M | 36.57M | Financing Cash Flow |
| -13.84M | 26.77M | -25.39M | -12.21M | -11.65M |
American Coastal Insurance Technical Analysis
Positive
11.75
Price Trends
11.21
Positive
11.72
Positive
11.68
Positive
Market Momentum
0.02
Negative
60.12
Neutral
89.78
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ACIC, the sentiment is Positive. The current price of 11.75 is above the 20-day moving average (MA) of 11.15, above the 50-day MA of 11.21, and above the 200-day MA of 11.68, indicating a bullish trend. The MACD of 0.02 indicates Negative momentum. The RSI at 60.12 is Neutral, neither overbought nor oversold. The STOCH value of 89.78 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 1 New Risks
1.
We have identified a material weakness in our internal control over financial reporting, and our management has concluded that our internal control over financial reporting and disclosure controls and procedures were not effective as of the end of the period covered by this report. While we are working to remediate the identified material weakness, we cannot assure you that additional material weaknesses or significant deficiencies will not occur in the future. If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. As a result, our stockholders could lose confidence in our financial reporting, which could harm our business and the trading price of our common stock. Q3, 2023
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 |
|---|---|---|---|---|---|---|---|
78 Outperform | $780.73M | 12.14 | 16.95% | 2.31% | 7.24% | -9.28% | |
78 Outperform | $582.73M | 12.01 | 13.78% | 2.93% | 17.35% | -13.53% | |
76 Outperform | $789.40M | 9.72 | 27.59% | ― | 11.41% | 53.85% | |
65 Neutral | $498.98M | 10.74 | 7.04% | ― | 7.75% | -49.93% | |
65 Neutral | $444.51M | 15.59 | 4.14% | 4.50% | -10.61% | -19.48% | |
64 Neutral | $12.80B | 9.71 | 7.59% | 16985.66% | 12.07% | -7.53% | |
56 Neutral | $578.31M | 7.75 | 31.11% | ― | 12.19% | 5.12% |
* Financial Sector Average
Performance Comparison
ACIC
American Coastal Insurance
11.75
1.03
9.61%
GBLI
Global Indemnity
31.22
1.23
4.10%
GLRE
Greenlight Capital Re
14.13
1.55
12.32%
UVE
Universal Insurance Holdings
27.56
9.48
52.43%
HRTG
Heritage Insurance Holdings
24.05
15.90
195.09%
FSBC
Five Star
27.26
4.87
21.75%
American Coastal Insurance Corporate Events
Business Operations and Strategy
American Coastal Insurance Renews Reinsurance Program
Positive
May 29, 2025
On June 1, 2025, American Coastal Insurance Corp. renewed its core catastrophe reinsurance program, increasing its occurrence-based limit by 3.9% to approximately $1.676 billion for the 2025/26 period. This renewal enhances ACIC’s coverage, ensuring sufficient protection against significant events, including a 1-in-201-year event, and reflects a strategic adjustment in retention levels, impacting stakeholders by increasing financial resilience against future catastrophic losses.
The most recent analyst rating on (ACIC) stock is a Buy with a $16.00 price target. To see the full list of analyst forecasts on American Coastal Insurance stock, see the ACIC Stock Forecast page.
Executive/Board ChangesShareholder Meetings
American Coastal Insurance Holds 2025 Annual Meeting
Neutral
May 22, 2025
American Coastal Insurance held its 2025 Annual Meeting where stockholders voted on four proposals. The meeting resulted in the election of Class A directors for a two-year term and the ratification of Deloitte & Touche, LLP as the independent registered public accounting firm for the fiscal year ended December 31, 2025. Additionally, stockholders recommended the compensation of the Company’s named executive officers.
The most recent analyst rating on (ACIC) stock is a Buy with a $16.00 price target. To see the full list of analyst forecasts on American Coastal Insurance stock, see the ACIC Stock Forecast page.
Financial Disclosures
American Coastal Insurance Reports Q1 2025 Financial Results
Neutral
May 8, 2025
American Coastal Insurance Corporation reported its financial results for the first quarter ended March 31, 2025, showing a 7.2% increase in gross premiums written compared to the previous year. However, despite the growth in premiums, the company experienced a 9.5% decline in consolidated net income, reflecting challenges in maintaining profitability.
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.