HomeMost PopularThe Hartford Financial Stock: Riding High With a 19% YTD Surge

The Hartford Financial Stock: Riding High With a 19% YTD Surge

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Market Performance and Valuation

The Hartford Financial’s stock (NYSE: HIG) has outshone the S&P500 index with a robust 19% YTD growth, soaring to $96 per share. Interestingly, this places it at a 6% discount relative to its fair value of $102, as evaluated by Trefis.

Striving Amidst Market Waves

In a volatile financial climate, HIG stock has displayed remarkable resilience, surging by 90% since January 2021, in contrast to the S&P’s 35% increase. Although the stock couldn’t consistently outpace the market, its three-year returns paint a mixed picture: 41% (2021), 10% (2022), and 6% (2023). The contrasts with the S&P’s performance highlight the challenges stocks like HIG faced in recent times.

Outstanding Q4 Performance

Defying market odds, the insurance powerhouse exceeded Q4 2023 estimates with a 6% y-o-y jump in total revenues amounting to $6.4 billion, primarily driven by an 8% surge in earned premiums. Notable growth in the property & casualty and group benefits segments propelled the premiums. Lower expenses led to a 30% y-o-y spike in adjusted net income, reaching $766 million.

Financial Fortitude in Focus

Bolstering its fiscal strength, Hartford Financial’s FY2023 revenues notched up by 9% to $24.5 billion, majorly attributed to an 8% leap in earned premiums and a 6% rise in net investment income. Cost optimizations resulted in an operating margin rise to 12.6%, propelling adjusted net income up by 38% to $2.48 billion.

Projected Growth Trajectory

Heading into Q1, momentum is expected to persist. Projections suggest Hartford Financial’s revenues could hit $26.36 billion in FY2024 with an approximated adjusted net income of $3.06 billion and an annual GAAP EPS of $10.09. Coupled with a P/E just above 10x, the company is poised for a valuation of $102.

Returns Mar 2024 MTD [1] 2024 YTD [1] 2017-24 Total [2]
HIG Return 0% 19% 101%
S&P 500 Return 0% 6% 126%
Trefis Reinforced Value Portfolio 0% 4% 640%

[1] Returns as of 3/1/2024
[2] Cumulative total returns since the end of 2016

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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