Heritage Insurance Holdings

HRTG

Market cap $719M

Heritage Insurance has had a strong recovery from 2021-2022 losses through improved exposure management, underwriting discipline, and geographic diversification. My multi-stage residual income modeling suggests the current price is well below the intrinsic value, which presents a potential gain of 47% if bought at the current price of $25.35. Relative valuation metrics reveal the stock trades 40-80% below sector medians, reflecting overcaution from previous years of losses.

Heritage Insurance (HRTG) was a big mover last session on higher-than-average trading volume. The latest trend in earnings estimate revisions might not help the stock continue moving higher in the near term.

HRTG's commercial residential segment fuels premium growth, margin gains, and diversification beyond Florida.

Heritage Insurance's sharper focus on managing losses, rate adequacy, and tech investments is driving stronger underwriting profitability.

Heritage Insurance (HRTG) remains a Buy with a revised price target of $35, reflecting strong earnings momentum and favorable weather trends. HRTG's geographic diversification and a quiet storm season reduce near-term catastrophe results impiarment, supporting a positive outlook for 2025 earnings. Despite recent insider selling and  2 notch analyst downgrade to Hold, consensus analyst targets suggest 23% upside, with Q3 EPS likely to beat expectations.

Heritage Insurance climbs above its 50-day average as disciplined underwriting, tech upgrades and selective growth fuel investor optimism.

Heritage is undergoing an operational transformation that is improving profitability and margins. The company has a strong niche in specialty insurance with technological advancements and risk management. Improved financial metrics include a 33.36% ROE and a forward P/E of 5.3x, indicating undervaluation.

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Despite higher catastrophe losses, HRTG, PRA, and HCI not only outperform the industry but also crush the Zacks S&P 500 composite and Finance sector.

HRTG's profitability hinges on keeping its combined ratio below 100% and recent gains show it's on track.