AnalystConsensusTarget updated the narrative for HGTY

Analysts have modestly increased their fair value estimate for Hagerty from $13.17 to $13.29 per share, citing expectations for stronger profit margins and the potential for margin expansion as highlighted in recent research coverage.

Analyst Commentary

Recent Street research provides a mix of optimism and caution regarding Hagerty's growth outlook and valuation trajectory. The coverage reflects both the opportunities present in the company's business model and certain challenges that may impact near-term performance.

• Analysts highlight Hagerty's position as a global leader with a strong market share in specialty insurance for classic and enthusiast vehicles. This reinforces the company's "wide moat" and limited competition.
• Expectations call for mid-teens compounded premium growth, supported by an expanding relationship with State Farm and rising client retention as underwriting economics improve.
• Bullish analysts note that investments in operations and a growing non-insurance revenue stream from marketplace and media businesses could drive both top-line expansion and operating leverage over the next several years.
• EPS forecasts remain above consensus estimates through at least 2027 and point toward potential margin expansion and greater profitability as macro tailwinds support continued growth.

• Cautious views persist around Hagerty's current valuation, with some considering the shares fairly valued at current levels and requiring further margin expansion to justify upside.
• Analysts point out the potential for a 2026 "accounting-related air pocket," which could create temporary headwinds and limit near-term bullishness.
• Some believe that while premium growth is accelerating, execution against growth targets and realization of operating leverage will be critical to maintaining higher valuations.
• There is a consensus that catalysts are needed for the shares to move significantly higher, specifically through improved margins and successful integration of strategic partnerships.

What's in the News

• Hagerty has launched the Safe Storage Concierge program in partnership with Way, providing insured members in Tampa and Miami access to five days of secure, enclosed vehicle storage during severe weather at no additional charge. The program uses Way's digital platform for reservations and aims to aid customers facing hurricanes and tropical storms. (Key Developments)
• Motorlux, a Hagerty-affiliated event, delivered a sold-out opening night at Monterey Car Week. It showcased more than 275 collector cars and 15 aviation displays, and featured the record sale of a 2005 Maserati MC12 Stradale for $5.2 million at Broad Arrow Auctions. (Key Developments)
• Hagerty, Inc. completed a follow-on equity offering, raising $90.6 million through the sale of 9,700,000 shares of Class A Common Stock at $9.34 per share. (Key Developments)
• The company increased its 2025 earnings guidance and now expects total revenue growth of 13-14% and net income growth of 43-53% compared to prior estimates. (Key Developments)
• Multiple classes of Hagerty stock, including Class A Common Stock, Restricted Stock Units, and Series A Convertible Preferred Stock, are subject to a 91-day lock-up period ending November 6, 2025. (Key Developments)

Valuation Changes

• The Fair Value Estimate has risen slightly from $13.17 to $13.29 per share.
• The Discount Rate remains unchanged at 6.78%.
• The Revenue Growth projection has fallen moderately, decreasing from 4.43% to 3.96%.
• The Net Profit Margin has increased from 15.38% to 16.90%.
• The Future P/E has declined from 6.53x to 6.08x.