Company Overview - Horace Mann Educators Corporation (HMN) is experiencing significant attention from investors due to high implied volatility in its options market, particularly the Feb 21, 2025 $35.00 Call option [1] Implied Volatility Insights - Implied volatility indicates the market's expectation of future price movement, suggesting that investors anticipate a significant price change for Horace Mann Educators shares [2] - High implied volatility may also signal an upcoming event that could lead to a substantial rally or sell-off [2] Analyst Sentiment - Currently, Horace Mann Educators holds a Zacks Rank 2 (Buy) within the Insurance-Multi line industry, which is in the top 28% of the Zacks Industry Rank [3] - Over the past 60 days, no analysts have raised their earnings estimates for the current quarter, while two have lowered their estimates, resulting in a decrease of the Zacks Consensus Estimate from $1.10 to $0.99 per share [3] Trading Strategy Implications - The high implied volatility may indicate a developing trading opportunity, as options traders often seek to sell premium on options with elevated implied volatility to capture decay [4] - Seasoned traders typically hope that the underlying stock does not move as much as initially expected by expiration [4]

Company Overview - Horace Mann Educators Corporation (HMN) has a market capitalization of $1.5 billion and is the largest multiline financial services company focused on America's educators, operating in a niche market with a diversified earnings model [2] - HMN's share price as of January 8, 2025, was $37.76, down 12.7% from its 52-week high of $43.26, indicating a short-term bearish trend as it trades below its 50-day simple moving average [1][3] Performance Metrics - HMN shares have gained 8.7% over the past three months, outperforming its industry's decrease of 2.3%, the sector's rise of 2.6%, and the S&P 500 composite's gain of 3.2% during the same period [5] - The Zacks average price target for HMN is $44 per share, suggesting a potential upside of 15.6% from the recent closing price [8] Growth Projections - The Zacks Consensus Estimate for HMN's 2025 earnings is $3.82, reflecting a year-over-year improvement of 11.1% on revenues projected to be about $10 billion, which is a 6.1% increase [9] - HMN aims to achieve a combined ratio of 97% to 98% in 2025, supported by solid retention and a well-planned approach to auto rate increases [10] Financial Health - The company estimates generating about $50 million in excess capital annually to support growth initiatives, share buybacks, and dividend increases, with free cash flow conversion remaining above 100% [13] - HMN's return on invested capital (ROIC) has improved but was 1.2% in the trailing 12 months, below the industry average of 2.4% [15] - The return on equity (ROE) for HMN was 8.1% in the trailing 12 months, also below the industry average of 15.3%, with a target of achieving double-digit ROE by 2025 [16] Valuation - HMN shares are trading at a discount with a book-to-price ratio of 1.2X compared to the industry average of 2.3X, earning a Value Score of A [17] - Despite being cheaper than the industry average, HMN shares are still considered expensive compared to competitors like Brighthouse Financial, Inc. and Lincoln National Corporation [17] Dividend Policy - HMN has increased dividends for 16 consecutive years at a compound annual growth rate (CAGR) of 14%, with a current dividend yield of 3.6%, higher than the industry average of 2.5% [19] - The company targets a 50% dividend payout over the medium term, indicating a strong commitment to returning value to shareholders [19] Market Position - The K-12 educator market presents substantial growth potential for HMN, which is well-positioned to capitalize on strategic initiatives aimed at profitability and maintaining a solid capital position [18]

| --- | --- | --- | --- | |-----------------------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Third Quarter 2024 | | | | | | | | | | Investor Presentation | | | | | | | | | | | | | | | November 4, 2024 | | | | | | | | | | | | | | | | | | | | | | | | Information as of September 30, 2024, unless otherwise noted Safe Harbor Statement and Non-GAAP Measures Certain statements included in this presentation, including those regarding our earnings outlook, expected catast ...

Horace Mann (HMN) came out with quarterly earnings of $0.76 per share, in line with the Zacks Consensus Estimate. This compares to earnings of $0.44 per share a year ago. These figures are adjusted for non-recurring items.A quarter ago, it was expected that this provider of auto and homeowners' insurance for teachers and other educators would post earnings of $0.18 per share when it actually produced earnings of $0.20, delivering a surprise of 11.11%.Over the last four quarters, the company has surpassed co ...

Wall Street expects a year-over-year increase in earnings on higher revenues when Horace Mann (HMN) reports results for the quarter ended September 2024. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates. The earnings report, which is expected to be released on November 4, 2024, might help the stock move higher if these key numbers are better than ...

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and ...

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies. Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that ...

Horace Mann Educators Corporation (HMN) shares are trading at a discount to the Zacks Multiline Insurance industry. Its forward price-to-earnings of 1.21X is lower than the industry average of 2.78X. This company has a market capitalization of $1.5 billion. The average volume of shares traded in the last three months was 0.2 million. Image Source: Zacks Investment Research The stock, however, remains expensive compared with other players like Brighthouse Financial, Inc. (BHF) and Lincoln National Corporatio ...

GRAND FORKS, N.D. and ROCHESTER, Minn., Sept. 26, 2024 (GLOBE NEWSWIRE) -- Alerus Financial Corporation (Nasdaq: ALRS) and its wholly owned subsidiary, Alerus Financial, National Association, (together, "Alerus") announced today they have received all regulatory approvals necessary to complete the previously announced acquisition of HMN Financial, Inc. (Nasdaq: HMNF) and its wholly owned subsidiary, Home Federal Savings Bank (together, "Home Federal"). The merger was unanimously approved by the board of dir ...

Financial Data and Key Metrics Changes - The company reported second quarter core earnings of $0.20 per diluted share, a significant increase from $0.03 a year ago [4][16] - Total revenues increased by 9%, with net premiums and contract deposits earned rising by 8% [4] - The pre-tax investment yield rose to 4.46%, with new money rates exceeding the portfolio book yield by 163 basis points [5] Business Line Data and Key Metrics Changes - Property and Casualty (P&C) sales increased by 37%, while supplemental and group benefit sales rose by 20% [4] - In the P&C segment, net written premiums rose nearly 17% to $199 million, with a combined ratio of 111.5, improving by 13 points over the prior year [21] - Life and retirement core earnings were $12 million, down 29% year-over-year due to lower income from commercial mortgage loan funds [23] - Worksite direct sales increased by 14%, with employer-sponsored sales also up, although overall sales volume in the second quarter was generally light [12][24] Market Data and Key Metrics Changes - The number of covered lives in the employer-sponsored business reached 830,000, a 2% increase over the prior year [12] - Catastrophe losses in the second quarter amounted to $41 million, slightly lower than the previous year but above historical averages [8][21] Company Strategy and Development Direction - The company aims to achieve an underwriting profit in the P&C segment in 2024 and target profitability in 2025, with a goal of a double-digit return on equity [4][13] - The diversified business model is expected to generate about $50 million in excess capital annually above dividends and interest expenses [25] - Share repurchases are part of a thoughtful capital management strategy, with $7.7 million spent on buybacks year-to-date [14][40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving target profitability across all segments by 2025, despite challenges in the commercial mortgage loan portfolio [14][25] - The company anticipates a recovery in investment income as market conditions improve, particularly in the commercial real estate sector [6][20] - Management noted that the agency force is more engaged and productive, contributing to strong retail sales growth [11] Other Important Information - The company has implemented new roof rating schedules in six wind-prone states, with initial estimates showing close to $1 million in cost savings [9] - The company has been actively engaging with educators through appreciation activities, resulting in doubled website traffic [14] Q&A Session Summary Question: Discussion on auto accident frequency and severity trends - Management noted that elevated accident frequency in the quarter was due to seasonal factors, with overall frequency flat year-over-year [27][28] Question: Inquiry about the delta between filed rate increases - Management indicated that while rate increases have been broad, future adjustments may align more closely with underlying coverage inflation [29] Question: Timeline for recovery in unrealized marks in the CML portfolio - Management stated that two-thirds of the CML portfolio will mature over the next 18 months, which is expected to provide a tailwind for investment income [30][31] Question: Interest rates and their impact on CML portfolio valuation - Management explained that the portfolio primarily consists of floating-rate loans, which have helped cash yields but put pressure on valuations [32][33] Question: Favorable prior year developments and their sustainability - Management expressed confidence in the favorable trends observed in auto claims, although future developments cannot be guaranteed [34][36][37] Question: Share repurchase strategy and expectations - Management reiterated that share repurchases are opportunistic and part of a broader capital management strategy, with confidence in excess capital production capabilities [38][40]