Increased Confidence in Guidance Upside, but Fog Persisting; Upcoming 5/29 Event

Research evidence excerpt

Increased Confidence in Guidance Upside, but Fog Persisting; Upcoming 5/29 Event

Hagerty - Block Summary Model

Income Statement 2025A 2026E 2027E 2028E

Total Revenues 1,426 1,308 1,463 1,664

Net Premiums Written 1,194 1,389 1,603 1,865 Valuation

Adjusted EBITDA 237 241 323 438 We value HGTY as a hybrid personal lines broker and carrier

with little CAT exposure. We place a 30% premium on Net Income 41 (21) 58 85

top of the regression-derived EV/EBITDA from the organic

Adjusted Net Income 150 (41) 210 300 growth trajectories of BWIN, GSHD, and TWFG, equal to

Adjusted EPS $0.42 $(0.11) $0.58 $0.83 ~13.4x. We use 2027 rather than 2026 due to the build-up

of their profitable State Farm relationship and resulting

Source: BMO Capital Markets, Company Reports accounting noise likely to impact 2026 GAAP financials.

Upside Scenario $16.00

In our upside scenario, HGTY drives upside on its State

Farm conversions and expands its TAM more meaningfully

than we expected via Enthusiast Plus. HGTY's marketplace

business grows well in excess of expectations, meaningfully

broadening the company's revenue stream.

Downside Scenario $8.00

In our downside scenario, HGTY experiences worse

conversion rates on the State Farm book, and its Enthusiast

Plus product does not meaningfully drive share gains.

in USD

-22% +17% +56%

Downside Current Target Upside

Scenario Price Price Scenario

8.00 10.28 12.00 16.00

Key Catalysts

Key catalysts include quarterly reporting of progress on

onboarding of State Farm policies and share gains from

Enthusiast Plus, as well continued growth in Marketplace.

Company Description

Hagerty is an insurer and managing general agent for

classic car insurance. It also provides ancillary services to

its car enthusiast customers to foster excitement for classic

cars.