Hippo Holdings Inc. Common Stock (HIPO)

FairStock Score: 49/100 — MIXED

Key Financials

Strengths

• Generates $45 million in annual free cash flow (6.0% yield on market cap)
• Solid return on equity of 15.6% above cost of capital
• Conservative balance sheet with debt-to-equity of just 0.12, providing financial flexibility
• Revenue growth of 18.2% demonstrates strong top-line momentum

Concerns

• Weak Piotroski F-Score of 3/9 suggests deteriorating financial quality across multiple dimensions
• Altman Z-Score of -0.5 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Hippo Holdings Inc. Common Stock is a micro-cap financial services company valued at $746 million. The business generates $469 million in annual revenue with a 1.3% net margin and $45 million in free cash flow. From a quality standpoint, Hippo shows weak Piotroski F-Score of 3/9 signaling deteriorating fundamentals and distressed Altman Z-Score of -0.5 warrants caution. On valuation, the stock is attractively valued at 12.8x earnings, with a modest 1% margin of safety vs Graham Number. Growth dynamics show revenue growing at 18.2% and profit growth of -86.4%. Our composite FairStock Score of 49/100 reflects mixed fundamentals overall. This combination of reasonable valuation, solid returns, and conservative leverage makes it worth a closer look for value-oriented portfolios.

Bull Case

Hippo's 18% revenue growth trajectory could accelerate as it captures additional market share in the financial services sector. With $45 million in annual free cash flow (6.0% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the financial services space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer