Opco affirms Outperform on HCI post Hurricane Milton selloff

Oppenheimer attributes the selloff today in shares of HCI Group to Hurricane Milton’s formation over the weekend, which was just upgraded to a Category 5 and is projected to make landfall overnight Wednesday near Tampa. The firm believes HCI is “well-capitalized, with conservative reinsurance structure in place.” The Florida market has also seen considerable litigation reform and price increases, which will result in a less severe impact for Milton relative to Hurricane Ian’s time, the analyst tells investors in a research note. Opco sees a worst-case impact to bottom line of $150M between Helene and Milton for the company. It still expects HCI to remain profitable on the full-year despite the two significant events. The firm affirms an Outperform rating on the shares with a $140 price target