HCI Group (HCI) Stock Drops Despite Market Gains: Important Facts to Note

HCI Group (HCI) closed at $175.25 in the latest trading session, marking a -1.77% move from the prior day. The stock fell short of the S&P 500, which registered a gain of 0.79% for the day. Meanwhile, the Dow gained 0.26%, and the Nasdaq, a tech-heavy index, added 1.52%.

Prior to today's trading, shares of the property and casualty insurance holding company had gained 18% outpaced the Finance sector's gain of 2.74% and the S&P 500's loss of 1.82%.

Analysts and investors alike will be keeping a close eye on the performance of HCI Group in its upcoming earnings disclosure. The company is predicted to post an EPS of $5.08, indicating a 1.93% decline compared to the equivalent quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $240.67 million, indicating a 8.45% growth compared to the corresponding quarter of the prior year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $18.07 per share and revenue of $959.64 million. These totals would mark changes of -20.47% and +6.51%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for HCI Group. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 1.4% increase. At present, HCI Group boasts a Zacks Rank of #2 (Buy).

Looking at valuation, HCI Group is presently trading at a Forward P/E ratio of 9.87. Its industry sports an average Forward P/E of 11.68, so one might conclude that HCI Group is trading at a discount comparatively.

The Insurance - Property and Casualty industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 94, which puts it in the top 39% of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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This article originally published on Zacks Investment Research (zacks.com).

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