Rating Change #5
Harleysville Group Inc (HGIC) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, solid stock price performance and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
Highlights from the ratings report include:
- HGIC's revenue growth has slightly outpaced the industry average of 5.0%. Since the same quarter one year prior, revenues rose by 14.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- HGIC's debt-to-equity ratio is very low at 0.16 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- Powered by its strong earnings growth of 89.47% and other important driving factors, this stock has surged by 79.42% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, HGIC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Insurance industry. The net income increased by 93.2% when compared to the same quarter one year prior, rising from $20.97 million to $40.51 million.
Harleysville Group Inc., through its subsidiaries, engages in the property and casualty insurance business primarily in the eastern and midwestern United States. The company has a P/E ratio of 71.8, below the average insurance industry P/E ratio of 719.1 and above the S&P 500 P/E ratio of 17.7. Harleysville Group has a market cap of $1.56 billion and is part of the financial sector and insurance industry. Shares are up 2.7% year to date as of the close of trading on Tuesday.You can view the full Harleysville Group Ratings Report or get investment ideas from our investment research center.