HGTY Earnings Prediction
The chart below shows how HGTY performed 10 days before and after its earnings report, based on data from the past quarters. Typically, HGTY sees a +1.71% change in stock price 10 days leading up to the earnings, and a +1.13% change 10 days following the report. On the earnings day itself, the stock moves by +2.25%. This data can give you a slight idea of what to expect for the next quarter's release.
HGTY Key Earning Data
2024/Q4
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HGTY Earnings Analysis
Hagerty Inc Corporation (HGTY.N) Earnings Conference Call
Positive
Earnings Surprise: Hagerty, Inc. beats earnings expectations with reported EPS of $0.02, exceeding expectations of $0.01.
Consistent Growth and Profitability: The company has achieved eight consecutive quarters of executing its strategy for top-line growth and profitability.
User Base Expansion: Hagerty added over half a million car lovers to its ecosystem and grew revenue by $412 million over the last two years.
Operating Income Surge: Operating income increased sixfold in 2024 to $66 million despite challenges from Hurricane Celine and Milton.
Record Revenue Growth: The company reported a 20% revenue growth in 2024, welcoming a record 279,000 new members.
Predictable Revenue Growth: Written premium gains of 15% align with a ten-year compound annual growth rate of 15%, demonstrating predictable revenue growth.
Cash Flow Improvement: Operating cash flow tripled to $177 million, showcasing improved cash generation capabilities.
Customer Loyalty Success: The company achieved an impressive 89% retention rate in 2024, indicating strong customer loyalty.
Technology Transformation Impact: Hagerty's technology transformation is expected to drive future efficiency gains and scalable growth.
Investment Income Surge: Investment income jumped 57% in 2024 to $36 million, reflecting a successful transition to a diversified investment portfolio.
Projected Revenue Growth: The company anticipates 12% to 13% total revenue growth in 2025, driven by record new business count and customer retention.
Net Income Projection: Net income is expected to increase by 30% to 40% in 2025, equating to $102 million to $110 million.
Negative
Limited Profitability Despite Growth: Operating profit for Q4 was only $3 million, indicating limited profitability despite revenue growth.
Net Income Stagnation: Net income for Q4 was $8 million, which is slightly below the prior year's result, suggesting stagnation in profit growth.
Hurricane Impact on Income: The company faced a $27 million impact from Hurricane Celine and Milton, which negatively affected operating income.
Combined Ratio Analysis: The combined ratio of 94% is slightly above the long-term target of 90%, indicating higher costs than desired due to hurricane impacts.
Technology Transition Costs: The transition to a new technology platform (Duck Creek) is complex and expensive, leading to elevated investments of over $20 million in 2025, which may strain short-term profitability.
Margin Expansion Outlook: The company anticipates a measured rate of margin expansion in 2025 due to ongoing investments, which could slow down profit growth in the near term.
Combined Ratio Challenges: The expected combined ratio in the risk-taking entity is 90%, which indicates potential challenges in managing costs effectively.
HGTY FAQs
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HGTY Earning Call Sentiment
Hagerty, Inc. (NYSE:HGTY) Q4 2024 Earnings Call Transcript
HGTY.N
-2.02%Positive
The earnings call summary presents a mixed picture. While there are positive aspects such as significant revenue growth and optimistic guidance, there are notable risks like technology transition challenges, regulatory issues, and natural disaster impacts. The Q&A session highlighted unclear management responses, especially regarding tariffs. Despite strong financial metrics, the lack of a share repurchase or dividend program limits positive sentiment. The overall balanced outlook suggests a neutral stock price movement, with potential volatility due to external factors and market competition.
