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1. Company Snapshot

1.a. Company Description

HCI Group, Inc., together with its subsidiaries, engages in the property and casualty insurance, reinsurance, real estate, and information technology businesses in Florida.It provides residential insurance products, such as homeowners, fire, flood, and wind-only insurance to homeowners, condominium owners, and tenants for properties, as well as offers reinsurance programs.The company also owns and operates waterfront properties and retail shopping centers, and an office building, as well as commercial properties for investment purposes.


In addition, it designs and develops web-based applications and products for mobile devices, including SAMS, an online policy administration platform; Harmony, a policy administration platform; ClaimColony, an end-to-end claims management platform; and AtlasViewer, a mapping and data visualization platform.The company was formerly known as Homeowners Choice, Inc.and changed its name to HCI Group, Inc.


in May 2013.HCI Group, Inc.was incorporated in 2006 and is headquartered in Tampa, Florida.

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1.b. Last Insights on HCI

HCI Group's recent performance is driven by strong Q2 earnings, with EPS jumping 22% to $5.18 per share, surpassing estimates. The company's disciplined underwriting, prudent expansion, and robust balance sheet drive topline growth and operational efficiency, even in Florida's challenging insurance market. Analysts see a 31.2% upside potential, according to a consensus price target. HCI Group's exceptional liquidity, ample cash, and reinsurance recoverables ensure sustainability and dividend longevity. Its strong earnings and cash flow growth support continued appreciation.

1.c. Company Highlights

2. HCI Group's Q3 2025 Earnings Shine with Strong Profitability

HCI Group reported a robust third quarter in 2025, with earnings per share (EPS) of $4.90, significantly surpassing estimates of $2.44. The company's pretax income for the quarter was $90 million, a 70% year-over-year increase. The net combined ratio stood at 64%, indicating strong underwriting profitability, with a loss ratio of 22% reflecting lower claim frequency. Total shareholders' equity reached $821 million, and book value per share increased more than 50% year-to-date to $63.

Publication Date: Dec -02

📋 Highlights
  • Strong Pretax Income Growth:: Q3 pretax income surged 70% YoY to $90 million, driven by improved underwriting and operational efficiency.
  • Book Value Expansion:: Book value per share rose over 50% YTD to $63, with projections exceeding $80 by year-end due to Exzeo’s IPO proceeds ($155 million).
  • Exzeo IPO Impact:: Exzeo’s IPO generated $155 million in net proceeds, boosting HCI’s book value by $125 million and long-term equity to $821 million.
  • Real Estate & Debt Management:: Greenleaf Capital achieved full lease of Tampa campus and added a Pinellas County property, while long-term debt remained low at $32 million.
  • Policy Expansion:: Acquisition of 47,000 policies from Citizens added $175 million in annualized premium, with $105 million unearned (60%), to be recognized in Q4.

Business Segment Highlights

The company's real estate division, Greenleaf Capital, achieved a significant milestone with its three-building campus in Tampa being fully leased. Additionally, Greenleaf acquired a new complex in Pinellas County, Florida, expanding its portfolio. HCI Group's insurance platform, Exzeo, added a fifth carrier to its platform and successfully completed an initial public offering (IPO) earlier in the week, with HCI Group remaining a significant shareholder.

Financial Performance and Leverage

HCI Group's cash and investments increased by $334 million so far this year, and long-term debt stood at $32 million. Shareholder equity has almost doubled since the start of the year, now standing at $821 million. The company's new credit facility with Fifth Third Bank will significantly increase the amount of credit available to HCI, providing further financial flexibility.

Exzeo's IPO Impact

Exzeo's IPO resulted in net proceeds of $155 million, with HCI Group's book value expected to increase by $125 million and book value per share to increase by $10. This development is expected to push the company's book value to over $1 billion and book value per share to close to $80 by the end of the year.

Valuation and Growth Prospects

With a Price-to-Book Ratio (P/B) of 2.44, investors are pricing in HCI Group's strong profitability and growth prospects. Analysts estimate next year's revenue growth at 9.7%. The company's Return on Equity (ROE) stands at 32.28%, indicating efficient use of shareholder capital. As HCI Group continues to expand its insurance platform and real estate portfolio, its financial performance is likely to remain robust.

3. NewsRoom

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Is HCI Stock a Buy After One Hedge Fund Upped Its Stake by $9 Million?

Dec -03

Source: fool.com

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HCI Group (NYSE:HCI) vs. Stewart Information Services (NYSE:STC) Financial Contrast

Dec -02

Source: defenseworld.net

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3 P&C Insurance Stocks That Have Outperformed the S&P 500 YTD

Dec -01

Source:

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HCI Group (NYSE:HCI) versus Investors Title (NASDAQ:ITIC) Financial Review

Nov -29

Source: defenseworld.net

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Commonwealth of Pennsylvania Public School Empls Retrmt SYS Grows Position in HCI Group, Inc. $HCI

Nov -27

Source: defenseworld.net

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Tweedy Browne's Strategic Moves: Alphabet Inc. Sees a -1.43% Portfolio Impact

Nov -20

Source: gurufocus.com

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HCI Group: Strategic Underwriting, Well-Positioned Fundamentals Justify Valuation

Nov -19

Source: seekingalpha.com

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HCI Group (HCI) Reports Q3 Earnings: What Key Metrics Have to Say

Nov -08

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.23%)

6. Segments

Homeowners Choice Property & Casualty Insurance

Expected Growth: 10.0%

HCI Group's Homeowners Choice Property & Casualty Insurance segment growth of 10.0% is driven by increasing demand for homeowners insurance in Florida, expansion into new states, and a strong agent network. Additionally, the company's focus on technology and data analytics enables efficient underwriting and risk selection, contributing to premium growth and market share gains.

TypTap Group

Expected Growth: 9.0%

TypTap Group's 9.0% growth is driven by increasing demand for flood insurance, strategic partnerships, and geographic expansion. Additionally, HCI Group's investment in digital platforms and data analytics has enhanced underwriting capabilities, allowing TypTap to capitalize on market opportunities and improve operational efficiency.

Reclassification/Elimination

Expected Growth: 5.0%

HCI Group, Inc.'s 5.0% growth driven by reclassification/elimination is attributed to improved underwriting results, increased premiums earned, and a reduced loss ratio. Additionally, the company's strategic investments in technology and expansion into new markets have contributed to its growth. Furthermore, a favorable regulatory environment and effective cost management have also supported HCI Group's growth momentum.

Real Estate

Expected Growth: 8.0%

HCI Group, Inc.'s Real Estate segment growth of 8.0% is driven by increasing demand for insurance products, expansion into new markets, and strategic partnerships. Additionally, favorable regulatory environments, rising property values, and a growing need for catastrophe-exposed insurance products also contribute to this growth.

Corporate/Other

Expected Growth: 7.0%

HCI Group's Corporate/Other segment growth of 7.0% is driven by increased investment income, higher fees from affiliate companies, and a growing insurance-linked securities business. Additionally, the company's strategic investments in technology and expansion into new markets have contributed to the segment's growth.

7. Detailed Products

Homeowners Insurance

Provides financial protection to homeowners against damage to their homes and personal liability

Flood Insurance

Provides financial protection to homeowners and businesses against flood damage

Commercial Property Insurance

Provides financial protection to businesses against damage to their commercial properties

Reinsurance

Provides financial protection to insurance companies against large losses

Real Estate Services

Provides real estate services such as property management and title insurance

8. HCI Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for HCI Group, Inc. is medium due to the presence of alternative insurance providers and financial institutions that offer similar services.

Bargaining Power Of Customers

The bargaining power of customers is low due to the company's strong brand reputation and limited switching options for customers.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium due to the company's dependence on a few key suppliers for reinsurance and other services.

Threat Of New Entrants

The threat of new entrants is high due to the relatively low barriers to entry in the insurance industry and the potential for new competitors to disrupt the market.

Intensity Of Rivalry

The intensity of rivalry is high due to the highly competitive nature of the insurance industry and the presence of several established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 39.13%
Debt Cost 6.98%
Equity Weight 60.87%
Equity Cost 9.67%
WACC 8.62%
Leverage 64.27%

11. Quality Control: HCI Group, Inc. passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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A-Score: 6.6/10

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

173.01$

Current Price

173.01$

Potential

-0.00%

Expected Cash-Flows