Is Heritage Insurance Holdings, Inc. overvalued or undervalued?

As of 7 May 2025, the valuation grade for Heritage Insurance Holdings, Inc. has moved from attractive to very attractive. The company is currently considered undervalued, particularly given its P/E ratio of 14, which is notably lower than the industry average P/E of approximately 13.47 for HCI Group, Inc. and 18.74 for AMERISAFE, Inc. Additionally, the PEG ratio stands at an impressive 0.23, indicating strong growth potential relative to its price.
In comparison to its peers, Heritage Insurance demonstrates a favorable position with a higher ROE of 23.80%, while competitors like Lemonade, Inc. show a negative P/E ratio, and HCI Group, Inc. has a fair valuation with a P/E of 13.47. The company's recent performance has also outpaced the S&P 500, with a remarkable 1-year return of 223.06% compared to the index's 10.26%. This combination of strong financial ratios and competitive positioning suggests that Heritage Insurance is indeed undervalued in the current market.