NasdaqGM:HALL

Stock Analysis Report

Hallmark Financial Services

Executive Summary

Hallmark Financial Services, Inc., through its subsidiaries, underwrites, markets, distributes, and services property/casualty insurance products to businesses and individuals in the United States.

Rewards

PE ratio (11.8x) is below the US market (18.5x)

Revenue is forecast to grow 11.53% per year

Earnings grew by 489.7% over the past year

Risk Analysis

Earnings are forecast to decline by an average of -5% per year for the next 3 years



Snowflake Analysis

Proven track record and fair value.


Similar Companies

Share Price & News

How has Hallmark Financial Services's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HALL has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-4.5%

HALL

-0.9%

US Insurance

-0.3%

US Market


1 Year Return

68.6%

HALL

20.2%

US Insurance

18.6%

US Market

Return vs Industry: HALL exceeded the US Insurance industry which returned 20.2% over the past year.

Return vs Market: HALL exceeded the US Market which returned 18.6% over the past year.


Shareholder returns

HALLIndustryMarket
7 Day-4.5%-0.9%-0.3%
30 Day7.5%0.8%2.2%
90 Day4.0%0.8%5.6%
1 Year68.6%68.6%23.1%20.2%21.1%18.6%
3 Year54.6%54.6%32.2%22.1%45.6%36.2%
5 Year57.5%57.5%67.6%47.6%71.1%52.2%

Price Volatility Vs. Market

How volatile is Hallmark Financial Services's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Hallmark Financial Services undervalued compared to its fair value and its price relative to the market?

11.76x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: HALL ($18.38) is trading above our estimate of fair value ($2.53)

Significantly Below Fair Value: HALL is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: HALL is good value based on its PE Ratio (11.8x) compared to the Insurance industry average (16.7x).

PE vs Market: HALL is good value based on its PE Ratio (11.8x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: HALL's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: HALL is good value based on its PB Ratio (1.1x) compared to the US Insurance industry average (1.2x).


Next Steps

Future Growth

How is Hallmark Financial Services forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

-5.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HALL's earnings are forecast to decline over the next 3 years (-5% per year).

Earnings vs Market: HALL's earnings are forecast to decline over the next 3 years (-5% per year).

High Growth Earnings: HALL's earnings are forecast to decline over the next 3 years.

Revenue vs Market: HALL's revenue (11.5% per year) is forecast to grow faster than the US market (7.4% per year).

High Growth Revenue: HALL's revenue (11.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HALL's Return on Equity is forecast to be low in 3 years time (9.4%).


Next Steps

Past Performance

How has Hallmark Financial Services performed over the past 5 years?

-5.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HALL has high quality earnings.

Growing Profit Margin: HALL's current net profit margins (6.4%) are higher than last year (1.2%).


Past Earnings Growth Analysis

Earnings Trend: HALL's earnings have declined by -5.7% per year over the past 5 years.

Accelerating Growth: HALL's earnings growth over the past year (489.7%) exceeds its 5-year average (-5.7% per year).

Earnings vs Industry: HALL earnings growth over the past year (489.7%) exceeded the Insurance industry -10.4%.


Return on Equity

High ROE: HALL's Return on Equity (9.5%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Hallmark Financial Services's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: HALL has a low level of unsold assets or inventory.

Debt Coverage by Assets: HALL's debt is covered by short term assets (assets are 5x debt).


Financial Institutions Analysis

Asset Level: HALL's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if HALL has a sufficient allowance for bad loans.

Low Risk Liabilities: HALL reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if HALL has an acceptable proportion of non-loan assets held.

Low Risk Deposits: HALL has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if HALL has an appropriate level of bad loans.


Next Steps

Dividend

What is Hallmark Financial Services's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage2.3%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate HALL's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate HALL's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if HALL's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if HALL's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of HALL's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Hallmark Financial Services's salary, the management and board of directors tenure and is there insider trading?

0.9yrs

Average management tenure


CEO

Naveen Anand (52yo)

5.3yrs

Tenure

US$1,028,566

Compensation

Mr. Naveen Anand serves as President of Hallmark County Mutual Insurance Company and has been its Director since 2014. Mr. Anand serves as President of American Hallmark Insurance Company of Texas and has  ...


CEO Compensation Analysis

Compensation vs Market: Naveen's total compensation ($USD1.03M) is below average for companies of similar size in the US market ($USD1.71M).

Compensation vs Earnings: Naveen's compensation has been consistent with company performance over the past year.


Management Age and Tenure

0.9yrs

Average Tenure

52yo

Average Age

Experienced Management: HALL's management team is not considered experienced ( 0.9 years average tenure), which suggests a new team.


Board Age and Tenure

16.1yrs

Average Tenure

64yo

Average Age

Experienced Board: HALL's board of directors are seasoned and experienced ( 16.1 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$106,49015 Aug 19
Naveen Anand
EntityIndividual
Role
Chief Executive Officer
President & CEO
Shares6,500
Max PriceUS$16.38
SellUS$102,38813 Mar 19
Scott Berlin
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares9,750
Max PriceUS$10.53
SellUS$61,09322 Jan 19
James Graves
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares6,140
Max PriceUS$9.95

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Mark Schwarz (59yo)

    Executive Chairman of the Board

    • Tenure: 13.3yrs
    • Compensation: US$210.89k
  • David Miller

    Senior VP & Head of Human Resources

    • Tenure: 0.9yrs
  • Jeffrey Passmore (51yo)

    Senior VP

    • Tenure: 0.7yrs
    • Compensation: US$409.89k
  • Blake Zipoy

    Director of Corporate Communications

    • Tenure: 0yrs
  • Naveen Anand (52yo)

    President & CEO

    • Tenure: 5.3yrs
    • Compensation: US$1.03m
  • Barbara Sinclair

    Senior VP & Healthcare Group Leader

    • Tenure: 4.1yrs
  • Tarek Timol

    Chief Information Officer & Head of Operations

    • Tenure: 0.9yrs
  • Charles Stauber

    Chief Claims Officer

    • Tenure: 3.7yrs
  • Elena Banfi

    Vice President of Group Counsel & Compliance

    • Tenure: 0.9yrs
  • David Webb

    Senior VP of Corporate Development & Strategy

    • Tenure: 0.9yrs

Board Members

  • Scott Berlin (49yo)

    Independent Director

    • Tenure: 18.9yrs
    • Compensation: US$44.25k
  • Mark Pape (69yo)

    Independent Director

    • Tenure: 3.5yrs
    • Compensation: US$44.25k
  • Jim Graves (70yo)

    Independent Director

    • Tenure: 24.9yrs
    • Compensation: US$51.75k
  • Mark Schwarz (59yo)

    Executive Chairman of the Board

    • Tenure: 13.3yrs
    • Compensation: US$210.89k

Company Information

Hallmark Financial Services, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Hallmark Financial Services, Inc.
  • Ticker: HALL
  • Exchange: NasdaqGM
  • Founded: 1987
  • Industry: Property and Casualty Insurance
  • Sector: Insurance
  • Market Cap: US$331.109m
  • Shares outstanding: 18.12m
  • Website: https://www.hallmarkgrp.com

Number of Employees


Location

  • Hallmark Financial Services, Inc.
  • Two Lincoln Centre
  • Suite 1100
  • Dallas
  • Texas
  • 75240
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HALLNasdaqGM (Nasdaq Global Market)YesCommon StockUSUSDSep 1989

Biography

Hallmark Financial Services, Inc., through its subsidiaries, underwrites, markets, distributes, and services property/casualty insurance products to businesses and individuals in the United States. The com ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/06 23:37
End of Day Share Price2019/12/06 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.