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Heritage Insurance Holdings
(NYSE:HRTG)
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Rating:87Outperform
Price Target:
$39.00
▲(40.19% Upside)
Action:Reiterated
Date:08/08/26
HRTG scores highly primarily on strengthened financial performance (high profitability/ROE, strong cash conversion, and sharply reduced leverage) and a very low P/E valuation. Technicals are supportive with the stock above major moving averages and positive momentum, while the earnings call reinforced improved underwriting and reinsurance economics but flagged that reserve releases were unusually favorable and near-term growth pressures remain.
Positive Factors
De-risked Balance Sheet
A materially de-levered balance sheet and expanded equity base increase the company's ability to absorb catastrophe losses and underwriting cycles without forced capital raises. Lower leverage supports disciplined underwriting, opportunistic buybacks, and long-term financial flexibility for reinsurance and growth initiatives.
Negative Factors
One-time Reserve Development
Significant favorable prior-year reserve releases materially improved recent loss ratios and earnings; because management characterizes this as largely one-time, a portion of the recent profitability and ROE may not recur, leaving reported metrics vulnerable to future reserve volatility and masking underlying underwriting trends.
Read all positive and negative factors
Positive Factors
Negative Factors
De-risked Balance Sheet
A materially de-levered balance sheet and expanded equity base increase the company's ability to absorb catastrophe losses and underwriting cycles without forced capital raises. Lower leverage supports disciplined underwriting, opportunistic buybacks, and long-term financial flexibility for reinsurance and growth initiatives.
Read all positive factors
Heritage Insurance Holdings (HRTG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$956.79M
Dividend YieldN/A
Average Volume (3M)358.02K
Price to Earnings (P/E)4.7
Beta (1Y)0.68
Revenue Growth1.45%
EPS Growth102.69%
CountryUS
Employees542
SectorFinancial
Sector Strength70
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)7.04
Shares Outstanding29,732,416
10 Day Avg. Volume240,180
30 Day Avg. Volume358,018
Financial Highlights & Ratios
PEG Ratio0.02
Price to Book (P/B)1.79
Price to Sales (P/S)1.07
P/FCF Ratio5.19
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$36.50Price Target Upside31.20% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)4.83
Revenue Forecast (FY)$864.19M
Heritage Insurance Holdings Business Overview & Revenue Model
Company Description
Heritage Insurance Holdings, Inc. (HRTG) operates through its subsidiaries, specializing in providing comprehensive insurance products for both personal and commercial residential properties. For individual policyholders, the company offers person...
How the Company Makes Money
Heritage Insurance Holdings makes money primarily through (1) underwriting revenue and (2) investment income. Underwriting revenue is generated by collecting insurance premiums from policyholders in exchange for providing coverage for insured loss...
Heritage Insurance Holdings Earnings Call Summary
Earnings Call Date:Aug 05, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 11, 2026
Earnings Call Sentiment Positive
The call conveyed a strongly positive operational and financial picture driven by record earnings, exceptionally strong cash flow, markedly improved underwriting results (lower loss and combined ratios), meaningful reinsurance cost savings (~$63M annualized), reserve development, and strengthened capital metrics (book value, statutory surplus, declining leverage). Challenges were noted but characterized as manageable: modest declines in premiums in force and gross written premiums, competitive pricing pressure—particularly in Florida commercial residential—short-term production drag from Guidewire implementation, modestly higher acquisition costs, and small unrealized fixed income losses. On balance, the positive developments—especially large earnings and cash generation, underwriting improvement, and reinsurance savings—substantially outweigh the highlighted headwinds.Positive Updates
Record Quarterly Earnings and EPS
Net income of $61.7 million in Q2 2026 (record) vs $48.0 million prior year; diluted EPS $2.05 vs $1.55 prior year; year-to-date net income $98.2 million, up 25% YoY.
Negative Updates
Premiums in Force and Gross Written Premium Contraction
Premiums in force totaled $1.41 billion at quarter end, down 1.4% YoY from $1.43 billion; gross premiums written were $380.4 million, down 5.5% quarter-over-quarter.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Quarterly Earnings and EPS
Net income of $61.7 million in Q2 2026 (record) vs $48.0 million prior year; diluted EPS $2.05 vs $1.55 prior year; year-to-date net income $98.2 million, up 25% YoY.
Read all positive updates
Company Guidance
Management guided that reinsurance improvements should drive Florida rate reductions in the ~3–5% range while outside Florida they expect modest rate increases to keep margins roughly flat, with the ceded premium ratio expected to decline about 1–2 points (to the low‑40% range); they stressed that accident‑year loss trends are stable and that the strong Q2 prior‑year reserve development ($23.4M vs $2.3M LY) was largely a one‑time benefit to results (Q2 net loss ratio 30.4%, combined ratio 64.9%, net expense ratio 34.5%). They expect the Guidewire rollout disruption to fade and policy‑count growth to resume in coming quarters, supported by strong cash generation (Q2 operating cash flow $166.5M; YTD net income $98.2M, up 25% Y/Y) and ongoing diversification (placed >$2.2B of reinsurance limit and ~$63M of annualized reinsurance savings). Capital allocation will remain balanced — opportunistic buybacks (YTD repurchases >1M shares for $24.6M, ~3% of shares outstanding, $37.4M of the $50M program remaining), organic growth, and disciplined underwriting — backed by $2.45B of assets, $1.39B cash & invested assets, $567.7M equity, book value per share $19.09 (up 16.5% YTD, 54.5% Y/Y), combined statutory surplus $439.5M (up $47M YTD) and an 11% debt‑to‑capital ratio.Heritage Insurance Holdings Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
90
Very Positive
Cash Flow
83
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 781.73M | 847.33M | 816.99M | 735.50M | 662.46M | 631.56M |
| Gross Profit | 460.66M | 534.08M | 178.75M | 141.76M | 4.99M | 58.22M |
| EBITDA | 304.51M | 279.85M | 103.16M | 71.90M | -149.00M | -59.62M |
| Net Income | 215.29M | 195.59M | 61.54M | 45.31M | -154.36M | -74.73M |
Balance Sheet | ||||||
| Total Assets | 2.45B | 2.20B | 2.47B | 2.12B | 2.39B | 1.98B |
| Cash, Cash Equivalents and Short-Term Investments | 587.60M | 658.68M | 544.00M | 553.17M | 394.56M | 1.03B |
| Total Debt | 106.09M | 99.81M | 141.34M | 148.19M | 160.19M | 151.93M |
| Total Liabilities | 1.88B | 1.69B | 2.18B | 1.90B | 2.26B | 1.64B |
| Stockholders Equity | 567.73M | 505.25M | 290.80M | 220.28M | 131.04M | 343.05M |
Cash Flow | ||||||
| Free Cash Flow | 302.57M | 174.16M | 78.86M | 60.52M | -46.64M | 59.12M |
| Operating Cash Flow | 304.66M | 182.24M | 87.09M | 70.42M | -34.26M | 60.13M |
| Investing Cash Flow | -132.55M | -32.67M | -91.60M | 100.81M | -37.86M | -124.48M |
| Financing Cash Flow | -57.41M | -40.63M | -5.19M | 14.55M | -5.06M | -17.28M |
Heritage Insurance Holdings Technical Analysis
Positive
27.82
Price Trends
26.36
Positive
26.15
Positive
26.61
Positive
Market Momentum
1.73
Negative
62.86
Neutral
49.72
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HRTG, the sentiment is Positive. The current price of 27.82 is below the 20-day moving average (MA) of 29.26, above the 50-day MA of 26.36, and above the 200-day MA of 26.61, indicating a bullish trend. The MACD of 1.73 indicates Negative momentum. The RSI at 62.86 is Neutral, neither overbought nor oversold. The STOCH value of 49.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HRTG.
Heritage Insurance Holdings Risk Analysis
Heritage Insurance Holdings disclosed 37 risk factors in its most recent earnings report. Heritage Insurance Holdings 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
Heritage Insurance Holdings Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
87 Outperform | $956.79M | 4.68 | 42.41% | ― | 1.45% | 102.69% | |
82 Outperform | $1.39B | 9.73 | 14.96% | 1.40% | 11.18% | 52.50% | |
81 Outperform | $1.19B | 5.34 | 38.78% | 1.85% | 3.96% | 234.26% | |
74 Outperform | $1.52B | 22.12 | 7.16% | 3.57% | 7.04% | -18.57% | |
71 Outperform | $716.51M | 9.47 | 11.01% | 3.94% | -3.10% | -18.44% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
61 Neutral | $475.92M | 4.73 | 30.43% | ― | 3.29% | 21.74% |
* Financial Sector Average
HRTG
Heritage Insurance Holdings
32.96
10.88
49.28%
DGICA
Donegal Group
18.65
1.72
10.19%
SAFT
Safety Insurance Group
103.52
33.26
47.33%
UFCS
United Fire Group
53.20
23.00
76.14%
UVE
Universal Insurance Holdings
42.24
18.20
75.68%
ACIC
American Coastal Insurance
9.83
-0.40
-3.94%
Heritage Insurance Holdings Corporate Events
Executive/Board ChangesShareholder Meetings
Heritage Insurance Shareholders Approve Directors and Governance Matters
Neutral
Jun 11, 2026
At its annual meeting of stockholders held on June 10, 2026, Heritage Insurance shareholders elected six directors, including Panagiotis Apostolou, Irini Barlas, Ernie Garateix, Joseph Vattamattam, Paul Whiting, and Richard Widdicombe, to serve un...
Business Operations and Strategy
Heritage Insurance Optimizes 2026-2027 Catastrophe Reinsurance Program
Positive
May 29, 2026
On May 28, 2026, Heritage Insurance Holdings announced it had fully placed its 2026-2027 indemnity-based catastrophe excess-of-loss reinsurance program covering Heritage Property Casualty Insurance Company, Narragansett Bay Insurance Company and Z...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.