Core Viewpoint - Hippo Holdings Inc. (HIPO) has experienced a bearish trend recently, losing 6.1% over the past week, but the formation of a hammer chart pattern suggests a potential trend reversal as buying interest may be increasing [1][2]. Technical Analysis - The hammer chart pattern indicates a potential bottoming out, characterized by a small candle body and a long lower wick, suggesting that bears may be losing control over the price [4][5]. - This pattern typically forms during a downtrend when the stock opens lower, makes a new low, but then finds support and closes near its opening price, indicating a possible shift in momentum [4][5]. Fundamental Analysis - There is rising optimism among Wall Street analysts regarding HIPO's future earnings, with a significant increase of 56.2% in the consensus EPS estimate over the last 30 days, indicating a strong agreement on the company's potential for better earnings [7][8]. - HIPO currently holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks, which historically outperforms the market [9][10]. Conclusion - The combination of the hammer chart pattern and positive earnings estimate revisions enhances the prospects for a trend reversal in HIPO's stock price, supported by strong analyst sentiment [2][7][10].

Financial Data and Key Metrics Changes - Adjusted net income for Q3 2025 was $18 million, with gross written premium growing by 33% year over year to $311 million, up from $234 million in Q3 2024 [5][13] - Net written premium increased by 30% year over year to $118 million, up from $91 million in Q3 2024 [15] - Consolidated net income for Q3 was $98 million, or $3.77 per diluted share, a $107 million improvement year over year [19] - Total shareholders' equity at the end of the quarter was $422 million, up 14% from $362 million at year-end 2024 [19][20] Business Line Data and Key Metrics Changes - Casualty increased to 25% of gross written premium, up from 14% last year, while commercial and multi-peril increased to 21%, up from 13% [14] - Homeowners decreased from 47% of gross written premium in Q3 2024 to 32% in Q3 2025 [14] - Renters increased to 22% of net written premium, up from 10% last year, with a significant growth of 203% year over year [15][16] Market Data and Key Metrics Changes - The company bound its first new policies with Westwood Insurance Agency, which is expected to triple access to annual new home closings [7] - The underwriting results improved significantly, with a net loss ratio improving by 25 percentage points year over year to 48% [9][17] Company Strategy and Development Direction - The company is focusing on three strategic pillars: strategic diversification, unlocking market growth, and optimized risk management [6] - The introduction of a new reporting structure aligns with a unified way of managing the business, emphasizing gross and net premium by line of business [12] - The company anticipates growth in the homeowners market over the next three years, aiming for over $2 billion in premium by 2028 [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the underwriting discipline and the ability to maintain pricing standards amid increased competition [8] - The company raised its full-year 2025 guidance for gross written premium to a range of $1.09-$1.11 billion, reflecting expectations for continued growth in newer lines of business [20] - The consolidated net loss ratio guidance was improved to a range of 63%-64%, driven by positive loss trends [21] Other Important Information - The company appointed Robin Gordon as Chief Data Officer to enhance risk management and customer experience [10] - The consolidated combined ratio improved by 28 percentage points year over year to 100% [18] Q&A Session Summary Question: Growth in casualty business - Management noted that casualty growth is a combination of cyber, commercial general liability, and other lines, with a cautious approach to risk retention until profitability is established [25][26] Question: Competition in homeowners market - Management indicated that the admitted market is rebounding, leading to increased competition, but they feel confident in their pricing adequacy [27] Question: Future business mix by 2028 - Management expects to diversify further while anticipating growth in the homeowners market, aiming for over $2 billion in premium by 2028 [30][31] Question: Share repurchases and capital use - Management stated that capital will be used for portfolio growth and potential acquisitions to accelerate diversification [34]

Core Insights - Hippo Holdings Inc. reported quarterly earnings of $0.7 per share, significantly exceeding the Zacks Consensus Estimate of $0.04 per share, and compared to a loss of $0.34 per share a year ago, representing an earnings surprise of +1,650.00% [1] - The company achieved revenues of $120.6 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 1.77% and showing an increase from $95.5 million in the same quarter last year [2] - Hippo Holdings has outperformed the S&P 500, with shares increasing by approximately 34.1% since the beginning of the year, compared to the S&P 500's gain of 15.1% [3] Earnings Outlook - The future performance of Hippo Holdings' stock will largely depend on management's commentary during the earnings call and the company's earnings outlook, including current consensus earnings expectations for upcoming quarters [4][6] - The current consensus EPS estimate for the next quarter is $0.41 on revenues of $126.1 million, while for the current fiscal year, the estimate is -$0.23 on revenues of $472.2 million [7] Industry Context - The Zacks Industry Rank indicates that the Insurance - Multi line sector is currently in the top 28% of over 250 Zacks industries, suggesting a favorable environment for stocks in this sector [8] - Assured Guaranty, another company in the same industry, is expected to report quarterly earnings of $1.46 per share, reflecting a year-over-year decline of -39.7%, with revenues anticipated to be $178.9 million, down 12.3% from the previous year [9][10]

Financial Performance - Gross Written Premium (GWP) increased to $311.2 million[21] - Net Written Premium (NWP) reached $117.9 million[21] - Net Loss Ratio is 48%[4] - Net Combined Ratio is 100%[4] - Net income was $98.1 million[4] - Adjusted Net Income was $18.3 million[4] - Book Value Per Share (BVPS) grew 14% compared to year-end 2024, reaching $16.64[4, 27] Growth and Diversification - The company has a total of 36 programs, including 6 new programs[4, 11] - Westwood integration saw first policies bound in October 2025[12] - CMP & Casualty GWP grew by 130% compared to Q3 2024[12] Underwriting Improvements - Loss Ratio improved by 25 percentage points due to Westwood Integration[12] - Combined Ratio improved by 28 percentage points due to Westwood Integration[12] - Combined Ratio improved by 27.9 percentage points compared to Q3 2024[23] Future Outlook - The company projects 2025 Gross Written Premium between $1.09 billion and $1.11 billion[28] - The company projects 2025 Adjusted Net Income between $10 million and $14 million[28]

Core Insights - Hippo Holdings Inc. reported a strong performance in Q3 2025, achieving a net income of $98 million, or $3.77 per diluted share, compared to a net loss of $9 million in the same quarter last year [5][12][18] - The company experienced a 33% year-over-year increase in gross written premiums, reaching $311 million, driven by significant growth in the Casualty and Commercial Multi-Peril lines [3][7][12] - Hippo's net loss ratio improved by 25 percentage points to 48%, reflecting better underwriting results and a lack of significant catastrophe losses [10][12][11] Financial Performance - **Gross Written Premium**: Increased to $311.2 million in Q3 2025 from $234.4 million in Q3 2024, marking a 33% growth [4][12] - **Net Income**: Reported at $98.1 million for Q3 2025, a significant turnaround from a net loss of $8.5 million in Q3 2024 [5][12] - **Adjusted Net Income**: Reached $18.3 million, or $0.70 per diluted share, compared to an adjusted net loss of $1 million in the prior year [5][12][19] - **Total Revenue**: Increased by 26% to $120.6 million from $95.5 million in Q3 2024, primarily due to a 41% rise in net earned premiums [9][12] Underwriting and Loss Ratios - **Net Loss Ratio**: Improved to 48% from 73% year-over-year, driven by effective underwriting and diversification strategies [10][12][11] - **Combined Ratio**: Improved to 100% from 128% in the previous year, indicating enhanced operational efficiency [11][12] - **Expense Ratio**: Decreased to 52% from 55% year-over-year, contributing to the overall improvement in profitability [11][12] Shareholder Equity and Book Value - **Total Shareholder Equity**: Increased to $422 million, or $16.64 per share, up 14% from $362 million at year-end 2024 [6][12] - **Tangible Book Value Per Share**: Rose to $16.08 from $13.88 at the end of 2024, reflecting the company's strengthened financial position [21][12] Strategic Focus - Hippo is aligning its organizational structure to enhance efficiency and resilience, focusing on profitable growth and diversification across its insurance offerings [2][3] - The company has expanded its platform to 36 programs, indicating a commitment to scaling operations and adapting to market changes [3][12]

Financial Performance - Total revenue for the three months ended September 30, 2025, was $120.6 million, a 26.3% increase from $95.5 million in the same period of 2024[18] - Net earned premium increased to $99.7 million for Q3 2025, up 41.2% from $70.6 million in Q3 2024[18] - Net income attributable to Hippo for Q3 2025 was $98.1 million, compared to a net loss of $8.5 million in Q3 2024[18] - The company reported a comprehensive income of $99.4 million for Q3 2025, compared to a loss of $4.4 million in Q3 2024[18] - For the nine months ended September 30, 2025, net cash provided by operating activities was $6.0 million, a decrease from $53.9 million in the same period of 2024[26] - The company reported a net loss of $47.7 million for the three months ended March 31, 2025, compared to a net loss of $35.7 million for the same period in 2024[20] - Total comprehensive income for the three months ended June 30, 2025, was $99.4 million, driven by a net income of $98.1 million[20] - Net income attributable to common stockholders for the nine months ended September 30, 2025, was $51.7 million, compared to a net loss of $84.7 million in the same period of 2024[102] - Basic net income per share attributable to common stockholders was $2.04 for the nine months ended September 30, 2025, compared to a loss of $3.44 in the same period of 2024[102] Assets and Liabilities - Total assets as of September 30, 2025, were $1,873.6 million, an increase from $1,543.4 million as of December 31, 2024[15] - Total liabilities increased to $1,452.1 million as of September 30, 2025, compared to $1,178.2 million at the end of 2024[15] - As of September 30, 2025, total stockholders' equity was $421.5 million, with an accumulated deficit of $1,223.2 million[20] - Cash and cash equivalents rose to $247.7 million as of September 30, 2025, from $197.6 million at the end of 2024[15] - The total financial assets as of September 30, 2025, were $692.4 million, compared to $606.1 million as of December 31, 2024, indicating an increase of approximately 14.2%[55] Investments - The total fair value of fixed maturities available-for-sale securities as of September 30, 2025, was $245.5 million, with an amortized cost of $244.1 million, resulting in gross unrealized gains of $3.0 million and losses of $1.6 million[44] - The total fair value of short-term investments as of September 30, 2025, was $174.7 million, with an amortized cost of $174.7 million, indicating no unrealized gains or losses[44] - The company reported a total of $420.2 million in investments, which includes fixed maturities and short-term investments, as of September 30, 2025[44] - The carrying value of securities on deposit with state regulatory authorities totaled $13.2 million as of September 30, 2025, up from $12.2 million as of December 31, 2024[49] Reinsurance and Risk Management - The company maintained a comprehensive reinsurance program, with a mix of quota share and excess of loss structures, to manage risk exposure and reduce earnings volatility[71] - The company strategically retained more risk in recent periods by scaling back proportional reinsurance, reflecting confidence in the portfolio's underwriting performance[74] - The reserve for losses and loss adjustment expenses (LAE) net of reinsurance recoverables increased to $126.7 million as of September 30, 2025, compared to $122.5 million in 2024, reflecting a growth of 3.4%[66] - The net incurred losses and LAE showed favorable prior years development of $10.6 million for the nine months ended September 30, 2025, compared to $4.0 million in 2024, indicating a significant improvement[67] Stock and Compensation - The company issued 290,411 shares of common stock from stock plans and contingently issuable shares, resulting in an increase of $1.0 million in additional paid-in capital for the three months ended March 31, 2025[20] - The company repurchased 514,309 shares of common stock, resulting in a reduction of $14.5 million in total equity for the three months ended June 30, 2025[20] - The aggregate intrinsic value of options exercised during the nine months ended September 30, 2025, was $4.6 million, compared to $0.7 million in 2024, showing a substantial increase[88] - The company granted 42,244 performance restricted stock units (PRSUs) to its CEO, with a weighted-average grant-date fair value of $24.08 per unit, expecting total compensation expense of $1 million over three years[91] - Total stock-based compensation expense for the nine months ended September 30, 2025, was $22.6 million, a decrease from $29.3 million in the same period of 2024[96] Accounting and Regulatory - The company is currently evaluating the impact of new accounting standards on its financial statements, including ASU No. 2023-09, which requires detailed income tax disclosures effective for annual periods beginning after December 15, 2024[37] - The company has adopted ASU No. 2023-07 regarding reportable segment disclosures, which did not significantly impact its financial statements[36] - The company has determined that unrealized losses as of September 30, 2025, were due to the interest rate environment rather than creditworthiness issues, thus no allowance for credit losses was deemed necessary[46] Future Plans and Strategy - The company plans to expand its product offerings and enhance its technology to improve customer satisfaction and retention[10] - Hippo's strategy includes diversifying its distribution channels and entering new markets to drive future growth[10] - The company plans to leverage its proprietary technology and data to enhance risk management and improve underwriting accuracy[10]

Financial Results - Hippo Holdings Inc. announced financial results for Q3 2025, with a focus on non-GAAP financial information[4] - The report includes a reconciliation of non-GAAP financial measures to their nearest GAAP equivalents[5] - The financial results are part of the company's ongoing compliance with the Securities Exchange Act of 1934[6] - The report does not include specific performance metrics or future guidance as of the current document[4] Company Information - The company is classified as an emerging growth company under the Securities Act of 1933[3] - The company operates under the jurisdiction of Delaware and is listed on the New York Stock Exchange under the symbol HIPO[2] Reporting and Documentation - The company provided a press release, investor presentation, and historical supplemental financial information on November 5, 2025[4] - The quarterly investor presentation is dated November 5, 2025, highlighting key financial metrics[8] - The financial statements and exhibits are filed under Item 9.01 of the Current Report[7] - The report was signed by Guy Zeltser, Chief Financial Officer of Hippo Holdings Inc.[11]

Market Performance - The U.S. stock market showed strong performance last week, with major indices like the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average increasing by 0.82%, 0.84%, and 0.96% respectively [1] - Investor optimism was fueled by advancements in Artificial Intelligence and expectations for further interest rate cuts by the Federal Reserve, despite a partial government shutdown creating uncertainties [1] Consumer Confidence and Labor Market - The Conference Board's Consumer Confidence Index for September dropped by 3.6 points to 94.2, marking its lowest level since April, attributed to inflation and a weakening job market [2] - Job openings increased slightly by 19,000 to 7.227 million in August, while hiring decreased by 114,000 to 5.126 million according to the Job Openings and Labor Turnover Survey [2] Zacks Research Performance - Amneal Pharmaceuticals saw a stock increase of 29.9% since its Zacks Rank upgrade on July 25, outperforming the S&P 500's 5.5% increase [4][7] - Leidos Holdings experienced a 19.8% return following a Zacks Rank upgrade on July 28, also surpassing the S&P 500's 5.1% increase [5][7] - A hypothetical portfolio of Zacks Rank 1 stocks returned +8.64% in 2025 through September 1, compared to +7.60% for the S&P 500 index [5] Focus List and Model Portfolios - The Zacks Focus List portfolio returned 13.74% in 2025 through August 31, outperforming the S&P 500 index's 10.79% [12] - Intellia Therapeutics gained 85.9% and Shopify returned 38.3% over the past 12 weeks, significantly outperforming the S&P 500's 7% increase during the same period [11] Earnings Certain Admiral Portfolio (ECAP) - The ECAP returned +0.20% in Q2 2025, underperforming the S&P 500 index's +10.94% gain [16] - The portfolio aims to minimize capital loss by holding shares of companies with a proven track record of earnings stability over 20+ years [17] Earnings Certain Dividend Portfolio (ECDP) - Johnson & Johnson returned 20.9% and Home Depot increased by 6.3% over the past 12 weeks, benefiting from investor preference for quality dividend stocks amid market volatility [19] - The ECDP returned -3.17% in Q2 2025, compared to the S&P 500 index's +10.94% gain [20] Top 10 Stocks Performance - Goldman Sachs, part of the Zacks Top 10 Stocks for 2025, increased by 38% year-to-date, outperforming the S&P 500 index's 14.2% increase [22] - The Top 10 portfolio has produced a cumulative return of +2,369.7% since 2012, significantly outperforming the S&P 500 index's 522.5% [24]

Core Insights - Hippo has appointed Robin Gordon as Chief Data Officer to enhance its Data & Analytics function, focusing on predictive modeling, machine learning, and AI for improved risk management and growth opportunities [1][2][3] Company Strategy - The appointment of Robin Gordon emphasizes Hippo's commitment to being a technology-driven insurer, utilizing advanced data and analytics to diversify its insurance risk portfolio [2][3] - Gordon's experience includes leadership roles at major financial institutions, where she has driven digital transformation and AI adoption, which will be crucial for Hippo's risk management and customer experience initiatives [2][3] Leadership and Expertise - Robin Gordon has over a decade of experience in executive roles, including her tenure as Global Chief Data & Analytics Officer at MetLife, where she developed an enterprise data strategy supporting $65 billion in revenue across 60 countries [2] - Gordon holds an MBA from the McCombs School of Business and a bachelor's degree in Commerce, Economics, and Information Systems, highlighting her strong educational background [2] Company Overview - Hippo is a technology-enabled insurance group that diversifies risk across personal and commercial lines, offering tailored coverage through its Homeowners Insurance Program [4] - The company operates through various subsidiaries, including Hippo Insurance Services and Spinnaker Insurance Company, and focuses on proactive insurance solutions [4]

Summary of Hippo Conference Call - September 17, 2025 Company Overview - **Company Name**: Hippo (NYSE:HIPO) - **Industry**: Insurance, specifically a tech-enabled program carrier focusing on personal and commercial lines, with a legacy in homeowners insurance [3][4] Key Financial Metrics - **Gross Written Premium**: Approximately $950 million in the last 12 months, projected to reach $1.1 billion by the end of 2025 [4][5] - **Revenue**: $425 million in the last 12 months, expected to be between $460 million and $465 million by the end of 2025 [4][5] - **Net Income**: Achieved net income positive for the first time from net operating activities [4] - **Book Value**: $333 million as of the end of the quarter, projected to increase to about $420 million by the end of 2025 [5] Growth Projections - **Future Growth**: Expected to nearly double gross written premium from $1.1 billion to over $2 billion by 2028 [7] - **Adjusted Net Income**: Projected to quadruple from about $30 million in 2025 to more than $125 million in 2028 [7] - **Return on Equity**: Anticipated to be in the high-teens by 2028 [7] Strategic Initiatives - **Organic Growth**: Plans to grow existing programs by 10% to 15% annually, leveraging a history with managing general agents (MGAs) [9] - **New Programs**: Aiming to add $100 million to $150 million in gross written premium from new programs each year [10] - **Partnership with The Baldwin Group**: This strategic transaction will triple access to new homes closed annually, enhancing growth and underwriting profitability [11][24][25] Underwriting Approach - **Diligent Underwriting**: Reviewed over 140 program opportunities in 2024, approving only 4, which resulted in $130 million of new business [10] - **Legacy Homeowners Business**: Focused on newly constructed homes through builders, with a loss ratio significantly lower than the industry average [18][30] - **Rate Increases**: Implemented over 170 rate filings resulting in a cumulative rate increase of more than 80% [19] Risk Management - **Geographic Diversification**: Reduced concentration in high-risk areas like Harris County, Texas, and focused on states with lower catastrophic exposure [31][32] - **Portfolio Diversification**: Increased mix of commercial property and casualty lines to enhance predictability and reduce volatility [32] Market Resilience - **Interest Rate Sensitivity**: Business has shown resilience to interest rate changes, with partnerships with builders providing better mortgage terms [22][23] - **Performance in Challenging Markets**: Despite challenges in homeowners insurance, diversification into casualty and commercial lines has provided stability [32] Conclusion - **Execution Track Record**: The company has a strong history of meeting or exceeding ambitious goals set in previous investor communications [20] - **Future Outlook**: Focus on responsible growth, improved underwriting performance, and a diversified portfolio to achieve higher profitability with lower volatility [21][14]