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Is HCI Group (HCI) Still a Good Investment Pick?

Bernzott Capital Advisors, an investment management firm, published its "US Small Cap Value Fund" third-quarter 2022 investor letter – a copy of which can be downloaded here. During the third quarter of the year, the portfolio fell –9.48% (net), below the R2000V’s decline of –4.6% and the R2500V’s decline of –4.5%. Try to spare some time to check the fund’s top 5 holdings for you to have an idea about their best stock picks this 2022.

In its Q3 2022 investor letter, Bernzott Capital Advisors US Small Cap Value Fund mentioned HCI Group, Inc. (NYSE:HCI) and explained its insights for the company. Founded in 2006, HCI Group, Inc. (NYSE:HCI) is a Tampa, Florida-based insurance company with a $337.2 million market capitalization. HCI Group, Inc. (NYSE:HCI) delivered a -53.90% return since the beginning of the year, while its 12-month returns are down by -67.01%. The stock closed at $38.51 per share on November 23, 2022.

Here is what Bernzott Capital Advisors US Small Cap Value Fund has to say about HCI Group, Inc. (NYSE:HCI) in its Q3 2022 investor letter:

"HCI (HCI): The property and casualty insurer with significant Florida presence reported disappointing earnings causing the stock to fall. Inflationary pressures weighed on costs and hurt earnings. On a positive note, gross written premiums grew modestly overall with continued strength in its TypTap unit, now active in 12 states, which posted 20% growth. As the quarter closed, Hurricane Ian pressured the stock as investors feared significant losses. Despite these concerns, HCI faced this storm from a position of relative strength. Earlier in the quarter, the company finalized its reinsurance program with pricing and terms comparable to last year and with substantial limits. It also increased its financial flexibility by raising $170 million in convertible notes. Many of its peers have been crippled, in some cases to the point of liquidation, putting HCI in a position to capitalize on price increases amid an improving competitive position."


Our calculations show that HCI Group, Inc. (NYSE:HCI) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. HCI Group, Inc. (NYSE:HCI) was in 12 hedge fund portfolios at the end of the second quarter of 2022, compared to 14 funds in the previous quarter. HCI Group, Inc. (NYSE:HCI) delivered a -23.88% return in the past 3 months.

In September 2022, we also shared another hedge fund’s views on HCI Group, Inc. (NYSE:HCI) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q3 page.

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Disclosure: None. This article is originally published at Insider Monkey.