In its concerted effort to enhance shareholder value, the
board of directors of
HCI Group Inc
) authorized the company to repurchase upto $40 million worth of
AMTRUST FIN SVC (AFSI): Free Stock Analysis
FIRST AMER FINL (FAF): Free Stock Analysis
HCI GROUP INC (HCI): Free Stock Analysis
XL GROUP PLC (XL): Free Stock Analysis Report
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The company will buy back the shares over the next one year.
The new authorization by HCI Group is duly supported by the
company's solid financial position, with cash and cash
equivalents of $293.4 million as of the end of 2013, improving
27.5% over 2012. A sustained solid operational performance
continues to cushion HCI Group's sturdy financial position. Share
repurchases are broadly intended to lower share count that in
turn boosts shareholders' value.
Earlier, the board of directors also approved a 22% increase in
the company's quarterly dividend. Its dividend currently yields
2.96% better than the industry average of 2.20%.
Several insurers are in the news presently for their efforts to
enhance shareholder value. Recently, the board of directors of
First American Financial Corporation
) increased the share repurchase authorization by $100 million to
$250 million. The board of directors of
XL Group plc
) approved a $1 billion buyback program while the same at
AmTrust Financial Services, Inc
) sanctioned a $150 million buyback program.
Early this month, HCI Group reported operating net income of
$1.31 per share for the fourth quarter of 2013. Though the figure
missed the Zacks Consensus Estimate by about 13%, it improved 10%
year over year largely on the strength of an improved top line.
HCI Group presently carries a Zacks Rank #3 (Hold). With the news
of the share buyback authorization poised to boost investor
confidence in the stock as well as add to the bottom line, we
expect analysts to raise their estimates and exert upward
pressure on the Zacks Rank. The stock witnessed no earnings
momentum over the last 60 days.