Value
9.9/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 10.0 |
| P/S | 9.7 |
| EV/EBITDA | 10.0 |
| Fwd P/E | 9.9 |
| PEG | 10.0 |
- ▸Forward P/E: 5.8x
- ▸PEG: 0.29
- ▸Attractively valued
HRTG · Why this verdict
Why Heritage Insurance Holdings, In (HRTG) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score6.5/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The stock is attractively valued, with a forward price/earnings multiple of just 5.7x and a PEG ratio of 0.29, alongside an excellent 47% return on equity and strong 24% margins. Valuation breakdown | The valuation discount should narrow toward fair value as the market credits the strong return-on-equity and margin profile over the next 12 months. | →Stable |
| CounterShares have already reached their resistance-based price target from the current price, per the data's own target-reached flag, so a low forward multiple may already be reflected in a fully priced stock rather than signaling further room to run. | ||
The sizing framework applies a deep-value margin-of-safety bonus of 72%, supporting a medium-conviction starter position despite the stock's near-term risk/reward being currently unfavorable. Position-sizing math | The margin-of-safety bonus should continue to support sizing as long as the underlying value case remains intact over the next 12 months. | →Stable |
| CounterThe position is only sized as a starter rather than a full position, reflecting that the deep-value bonus is being weighed against a currently negative asymmetry reading. | ||
The company has beaten earnings in three of the last four quarters, with an average surprise near 64%, though the most recent quarter missed estimates by 22.5%. Earnings track record | The beat streak should resume at the next report in 31 days, sustaining a positive average surprise. | →Stable |
| CounterThe most recent quarter's 22.5% miss breaks the prior three-quarter beat streak, raising the question of whether execution is starting to falter. | ||
Shares are technically overbought at an RSI of 80 and have already reached their resistance-based price target from the current price, producing a negative near-term risk/reward that the guidance frames as waiting for a pullback rather than exiting. Engine gate (failed) | A pullback toward the suggested entry level near the 50-day moving average would restore a favorable setup, with roughly 11% upside to resistance against about 7% downside to the stop from that lower entry point. | →Stable |
| CounterThe stock is still showing volume accumulation and trading above its 200-day moving average, so a pullback deep enough to reach the suggested entry level is not guaranteed to materialize. | ||
Insiders have shown modest net selling, with $343,559 in net sales over the past 90 days, a level the engine classifies as producing a bearish signal but not a severe one. Insider transaction read | Insider selling should remain modest or ease further for the bearish signal to not become a larger concern over the next 12 months. | →Stable |
| CounterThe same 90-day window includes $376,950 of insider buying alongside the selling, showing insider activity has been two-directional rather than one-sided. | ||
The stock is attractively valued, with a forward price/earnings multiple of just 5.7x and a PEG ratio of 0.29, alongside an excellent 47% return on equity and strong 24% margins.
→StableValuation breakdown
- Expectation
- The valuation discount should narrow toward fair value as the market credits the strong return-on-equity and margin profile over the next 12 months.
CounterShares have already reached their resistance-based price target from the current price, per the data's own target-reached flag, so a low forward multiple may already be reflected in a fully priced stock rather than signaling further room to run.
The sizing framework applies a deep-value margin-of-safety bonus of 72%, supporting a medium-conviction starter position despite the stock's near-term risk/reward being currently unfavorable.
→StablePosition-sizing math
- Expectation
- The margin-of-safety bonus should continue to support sizing as long as the underlying value case remains intact over the next 12 months.
CounterThe position is only sized as a starter rather than a full position, reflecting that the deep-value bonus is being weighed against a currently negative asymmetry reading.
The company has beaten earnings in three of the last four quarters, with an average surprise near 64%, though the most recent quarter missed estimates by 22.5%.
→StableEarnings track record
- Expectation
- The beat streak should resume at the next report in 31 days, sustaining a positive average surprise.
CounterThe most recent quarter's 22.5% miss breaks the prior three-quarter beat streak, raising the question of whether execution is starting to falter.
Shares are technically overbought at an RSI of 80 and have already reached their resistance-based price target from the current price, producing a negative near-term risk/reward that the guidance frames as waiting for a pullback rather than exiting.
→StableEngine gate (failed)
- Expectation
- A pullback toward the suggested entry level near the 50-day moving average would restore a favorable setup, with roughly 11% upside to resistance against about 7% downside to the stop from that lower entry point.
CounterThe stock is still showing volume accumulation and trading above its 200-day moving average, so a pullback deep enough to reach the suggested entry level is not guaranteed to materialize.
Insiders have shown modest net selling, with $343,559 in net sales over the past 90 days, a level the engine classifies as producing a bearish signal but not a severe one.
→StableInsider transaction read
- Expectation
- Insider selling should remain modest or ease further for the bearish signal to not become a larger concern over the next 12 months.
CounterThe same 90-day window includes $376,950 of insider buying alongside the selling, showing insider activity has been two-directional rather than one-sided.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Heritage Insurance Holdings pairs a cheap valuation and strong return on equity with a deep-value sizing bonus, but shares are overbought and have already reached their near-term resistance target, so the setup favors waiting for a pullback rather than adding at current levels.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 5.4 |
| Gross margin | 4.7 |
| Op margin | 9.6 |
| Net margin | 10.0 |
| Current ratio | 3.1 |
| FCF quality | 6.0 |
| Moat | 7.1 |
| Piotroski F | 8.9 |
- ▸Excellent ROE: 47%
- ▸Strong margins: 24%
- ▸Earnings quality warning: 79% FCF/NI
- ▸Strong Piotroski F-Score: 8/9
Growth
4.3/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.6 |
| EPS growth | 6.0 |
Momentum
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.1 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 0.0 |
- ▸Overbought (RSI 78)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 7.2 |
| erm sentiment | 5.0 |
Insider
6.2/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 4.0 |
| holder change | 10.0 |
- ▸Modest insider selling — $343,559 (0.041% of mkt cap)
- ▸Institutions accumulating
Peer rank
6.6/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 8.3 |
| quality rank | 9.0 |
| growth rank | 2.3 |
- ▸Attractive P/E vs peers
- ▸Superior ROE vs peers
Technical
3.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.8 |
| support resistance | 1.1 |
| 52w position | 7.0 |
Risk (lower is worse)
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.3 |
| days to cover | 8.9 |
| volatility | 2.5 |
| put call | 0.0 |
| implied vol | 1.1 |
| beta | 7.7 |
| debt equity | 9.2 |
- ▸Elevated put/call: 2.33
- ▸High IV: 74%
Catalyst
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Strong earnings: 3B/1M
How the verdict was assembled
Engine trigger
Downgraded from BUY WAIT — price $27.25 has reached target $27.42. No upside to wait for.
Engine technical detail
verdict_path:
L4:PATH_A_DEEP_VALUE|V8:TARGET_REACHED|SANITY:WAIT+price>=TPPassed (7)
- MOMENTUM:6.6>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:28d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.1=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.12
Upside
-1.7%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeCatalyst-Driven — Earnings in 28d with 3/4 beat streak
SuitabilitySpeculative — Binary industry: Insurance - Property & Casualty
Investment implication
The HOLD_IF_HOLDING verdict reflects the ASYMMETRY gate's -0.1=NEGATIVE outcome against Value at 9.9 and asymmetric R:R of -0.12.
The strongest dimensions are Value at 9.9, Quality at 7.2, and Catalyst at 6.7; the weakest are Technical at 3.3, Growth at 4.3, and Risk (lower is worse) at 5.4. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -0.12 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Quality Cheap Valuation
Trip ifReturn on equity falls below 20%, down from the current 47% level.
- P2Deep Value Margin Of Safety Bonus
Trip ifThe asymmetry ratio falls below -1.0, down from the current -0.08 reading, prompting the margin-of-safety sizing bonus to be removed.
- P3Beat Streak With Recent Miss
Trip ifEPS surprise falls below 0% (a miss) for 2 consecutive quarters, extending the recent miss into a losing streak.
- P4Overbought Wait For Pullback Setup
Trip ifRelative strength index falls below 40, reversing sharply from the current overbought reading of 80.
- P5Modest Two Directional Insider Activity
Trip ifInsider transactions flip to net buying exceeding $200,000 over a 90-day window, reversing the current $343,559 in net selling.