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HCI Group (HCI) Q4 Earnings Beat Estimates, Revenues In Line

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HCI Group, Inc.’s HCI fourth-quarter 2017 net earnings per share of $1.14 beat the Zacks Consensus Estimate of 82 cents by 39.02%. Also, the bottom line more than doubled year over year on lower expenses.

HCI Group, Inc. Price, Consensus and EPS Surprise

HCI Group, Inc. Price, Consensus and EPS Surprise | HCI Group, Inc. Quote


Behind the Headlines

Total operating revenues of $62 million declined 13.9% year over year. This downside can be attributed to lower net investment income and a decrease in premiums earned. The top line met the Zacks Consensus Estimate.

Gross premiums earned of $87.9 million fell 4.9% year over year, primarily due to policy attrition.

Net investment income of $2.9 million declined 5.5% year over year.

Losses and loss adjustment expenses dropped nearly 49% year over year to $23.2 million, resulting from the impact of Hurricane Matthew and reserve strengthening during the fourth quarter of 2016.

Total operating expenses declined 32.8% year over year to $44.7 million.

Loss ratio contracted 3010 basis points to 41.6% while expense ratio expanded 530 basis points to 38.5% in the reported period. Combined loss and expense ratio improved 2480 basis points to 80.1%.

Full-Year Highlights

HCI Group incurred loss of 75 cents per share against $2.92 earned in 2016.

Total revenues of $244.4 million decreased 7.6% year over year.

Combined ratio to gross premiums earned was 72.6% compared with 57.5% in 2016.

Financial Update

As of Dec 31, 2017, HCI Group had cash and investments of $255.9 billion, down 8.8% from $280.5 million at 2016-end.

Long-term debt of $237.8 million at 2017-end increased 71.2% from 2016-end level.

Stockholders’ equity decreased 20.4% from 2016-end level to $194 million at the end of 2017.

Book value per share of $22.14 as of Dec 31, 2017 lessened 12.2% year over year.

Zacks Rank    

HCI Group carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Insurers

Among other players from the insurance industry that have reported fourth-quarter earnings so far, the bottom line of The Progressive Corporation PGR, The Travelers Companies, Inc. TRV and RLI Corp. RLI topped the respective Zacks Consensus Estimate.

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