Goosehead Insurance, Inc (GSHD) Bundle
A Brief History of Goosehead Insurance, Inc.
Company Overview
Goosehead Insurance, Inc. (GSHD) is a property and casualty insurance agency that operates through a network of corporate agents and franchisees. The company focuses on providing personal lines insurance and has seen substantial growth since its inception.
Financial Performance
As of September 30, 2024, Goosehead reported total revenue of $78.0 million for the third quarter, representing a 10% increase from $71.0 million in Q3 2023. For the nine months ended September 30, 2024, total revenue reached $220.6 million, an 11% increase from $198.3 million in the same period of the previous year.
| Financial Metrics | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Total Revenue | $78.0 million | $71.0 million | $220.6 million | $198.3 million |
| Net Income | $12.6 million | $11.3 million | $25.3 million | $18.3 million |
| Adjusted EBITDA | $26.1 million | $22.4 million | $62.5 million | $55.7 million |
| Basic EPS | $0.31 | $0.29 | $0.63 | $0.44 |
Revenue Streams
Goosehead's revenue is derived from various streams, primarily categorized as Core Revenue, Cost Recovery Revenue, and Ancillary Revenue. The following table outlines the revenue breakdown for Q3 and the first nine months of 2024.
| Revenue Stream | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Renewal Commissions | $20.2 million | $19.0 million | $56.8 million | $53.4 million |
| New Business Commissions | $6.2 million | $6.1 million | $18.6 million | $17.9 million |
| Agency Fees | $2.0 million | $2.0 million | $6.0 million | $6.6 million |
| Contingent Commissions | $2.5 million | $4.8 million | $7.4 million | $10.7 million |
| Total Commissions and Agency Fees | $30.9 million | $31.9 million | $88.8 million | $88.6 million |
Growth Metrics
Goosehead has experienced significant growth in key performance indicators. As of September 30, 2024, the total written premiums placed by the company were $1.03 billion, up 28% from $802.9 million in Q3 2023. The number of policies in force increased to 1.636 million, representing a 12% growth from the previous year.
| Growth Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Written Premiums | $1.03 billion | $802.9 million |
| Policies in Force | 1.636 million | 1.5 million |
| Corporate Sales Headcount | 458 | 315 |
Client Retention and NPS
Goosehead's client retention rate has shown resilience, standing at 84% as of September 30, 2024. The Net Promoter Score (NPS) decreased slightly to 90, down from 92 a year earlier, indicating strong customer loyalty despite the competitive landscape.
| Client Metrics | As of September 30, 2024 | As of September 30, 2023 |
|---|---|---|
| Client Retention Rate | 84% | 87% |
| Net Promoter Score (NPS) | 90 | 92 |
Equity and Stock Performance
As of September 30, 2024, Goosehead has issued 24,369 shares of Class A common stock and 12,722 shares of Class B common stock. The company’s stock performance reflects its growth trajectory and financial health.
| Equity Metrics | As of September 30, 2024 | As of December 31, 2023 |
|---|---|---|
| Class A Common Stock Issued | 24,369 | 24,966 |
| Class B Common Stock Issued | 12,722 | 12,954 |
| Total Stockholders' Equity | $58.3 million | $56.6 million |
Liquidity and Cash Flow
As of September 30, 2024, Goosehead reported cash and cash equivalents of $50.1 million. The company generated net cash from operating activities of $59.0 million for the nine months ended September 30, 2024, reflecting strong operational performance.
| Cash Flow Metrics | 9M 2024 | 9M 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | $59.0 million | $37.4 million |
| Net Cash Used for Investing Activities | ($9.3 million) | ($14.6 million) |
| Net Cash Used for Financing Activities | ($43.7 million) | ($16.1 million) |
A Who Owns Goosehead Insurance, Inc (GSHD)
Ownership Structure
As of 2024, Goosehead Insurance, Inc. (GSHD) has a diversified ownership structure that includes both institutional and individual investors, as well as management. The management team retains approximately 35% of the company's equity, reflecting their commitment to the long-term success of the firm.
Major Shareholders
Below is a table detailing the major shareholders of Goosehead Insurance, Inc. as of 2024:
| Shareholder Type | Shareholder Name | Ownership Percentage | Shares Owned |
|---|---|---|---|
| Management | Management Team | 35% | ~12.5 million shares |
| Institutional Investor | BlackRock, Inc. | 10% | ~3.6 million shares |
| Institutional Investor | The Vanguard Group, Inc. | 8% | ~2.9 million shares |
| Institutional Investor | JPMorgan Chase & Co. | 5% | ~1.8 million shares |
| Other | Public Float | 42% | ~15.1 million shares |
Stock Performance
Goosehead Insurance, Inc. has shown significant stock performance over the past year. As of September 30, 2024, the company's stock price was approximately $32.50, reflecting a year-to-date increase of 25%.
Financial Highlights
The following table summarizes key financial metrics for Goosehead Insurance, Inc. as of Q3 2024:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Revenue | $78.0 million | $71.0 million |
| Net Income | $12.6 million | $11.3 million |
| Adjusted EBITDA | $26.1 million | $22.4 million |
| Earnings Per Share (Basic) | $0.31 | $0.29 |
| Policies in Force | 1,636,000 | 1,460,000 |
Market Position
Goosehead Insurance, Inc. is recognized as a rapidly growing personal lines independent insurance agency, with its market position strengthened by a comprehensive technology platform and innovative distribution strategies. The company has successfully placed total written premiums of $2.85 billion for the nine months ended September 30, 2024, marking a 29% increase year-over-year.
Franchise Performance
As of September 30, 2024, Goosehead operates 1,116 franchises, a decrease of 13% compared to the previous year. The corporate sales headcount has increased by 45% to 458 agents, indicating a strategic focus on enhancing corporate sales capabilities.
Conclusion
The ownership structure of Goosehead Insurance, Inc. reflects a blend of management commitment and institutional investment, positioning the company for continued growth and strong financial performance.
Goosehead Insurance, Inc (GSHD) Mission Statement
Goosehead Insurance, Inc. aims to provide consumers with superior insurance coverage at the best available price in a timely manner. By leveraging a differentiated business model and innovative technology platform, Goosehead seeks to enhance the insurance experience for its clients.
Financial Performance Overview
As of September 30, 2024, Goosehead Insurance reported significant financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $78.0 million | $71.0 million | 10% |
| Core Revenue | $73.5 million | $63.3 million | 16% |
| Total Written Premiums | $1.03 billion | $802.9 million | 28% |
| Net Income | $12.6 million | $11.3 million | 11% |
| Adjusted EBITDA | $26.1 million | $22.3 million | 17% |
Key Performance Indicators
The following are key operating metrics for Goosehead Insurance as of September 30, 2024:
| Metric | Value | Change (%) |
|---|---|---|
| Policies in Force | 1,636,000 | 12% |
| Corporate Sales Headcount | 458 | 45% |
| Total Franchises | 1,149 | -27% |
| Operating Franchises | 1,116 | -13% |
Revenue Streams
Goosehead Insurance categorizes its revenue into three main streams:
- Core Revenue: Comprises Renewal Commissions, New Business Commissions, Agency Fees, and Royalty Fees.
- Cost Recovery Revenue: Represents amounts recovered directly related to the cost of providing services.
- Ancillary Revenue: Includes Contingent Commissions and other ancillary fees.
For the nine months ended September 30, 2024, the following revenue breakdown was reported:
| Revenue Stream | Amount (in millions) | Percentage of Total Revenue |
|---|---|---|
| Renewal Revenue | $160.7 | 72% |
| New Business Revenue | $45.0 | 20% |
| Ancillary Revenue | $7.4 | 8% |
Client Retention and Satisfaction
Client retention metrics as of September 30, 2024, indicate a slight decrease:
| Metric | Value | Change (%) |
|---|---|---|
| Client Retention Rate | 84% | -3% |
| Net Promoter Score (NPS) | 90 | -2% |
Liquidity and Capital Resources
As of September 30, 2024, Goosehead Insurance reported:
| Metric | Amount (in millions) |
|---|---|
| Cash and Cash Equivalents | $47.5 |
| Total Liabilities | $355.8 |
| Total Stockholders' Equity | $58.3 |
Goosehead Insurance continues to focus on enhancing its mission of providing superior insurance solutions through growth and innovation.
How Goosehead Insurance, Inc (GSHD) Works
Business Model
Goosehead Insurance, Inc. operates as a personal lines independent insurance agency, leveraging technology to streamline the distribution of insurance products. The company focuses on providing superior insurance coverage at competitive prices through a network of corporate agents and franchisees.
Financial Performance
As of September 30, 2024, Goosehead reported total revenue of $78.0 million, marking a 10% increase from $71.0 million in the same quarter of 2023. For the nine months ended September 30, 2024, total revenue reached $220.6 million, up 11% from $198.3 million in the prior year.
| Period | Total Revenue ($ millions) | Net Income ($ millions) | Adjusted EBITDA ($ millions) | EPS (Basic) | EPS (Diluted) |
|---|---|---|---|---|---|
| Q3 2024 | 78.0 | 12.6 | 26.1 | 0.31 | 0.29 |
| Q3 2023 | 71.0 | 11.3 | 22.4 | 0.29 | 0.28 |
| 9M 2024 | 220.6 | 25.3 | 62.5 | 0.63 | 0.58 |
| 9M 2023 | 198.3 | 18.3 | 55.7 | 0.44 | 0.43 |
Revenue Streams
Goosehead's revenue consists of several streams, primarily categorized into Core Revenue, Cost Recovery Revenue, and Ancillary Revenue.
- Core Revenue: Includes Renewal Commissions, New Business Commissions, and Agency Fees.
- Cost Recovery Revenue: Primarily involves fees related to operational costs.
- Ancillary Revenue: Comprises Contingent Commissions and other fees.
| Revenue Stream | Q3 2024 ($ millions) | Q3 2023 ($ millions) |
|---|---|---|
| Core Revenue | 73.5 | 63.5 |
| Cost Recovery Revenue | 4.5 | 5.0 |
| Ancillary Revenue | 2.5 | 5.5 |
Key Performance Indicators
Goosehead tracks several key performance indicators to assess its operational efficiency and market position.
- Total Written Premium: Increased to $1.03 billion for Q3 2024 from $0.80 billion in Q3 2023.
- Policies in Force: Reached 1.636 million as of September 30, 2024, up 12% year-over-year.
- Client Retention Rate: Maintained at 84% as of September 30, 2024.
- Net Promoter Score (NPS): Decreased to 90 from 92 in the prior year.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Written Premium ($ billions) | 1.03 | 0.80 |
| Policies in Force (millions) | 1.636 | 1.5 |
| Client Retention Rate (%) | 84 | 82 |
| Net Promoter Score | 90 | 92 |
Liquidity and Cash Flow
As of September 30, 2024, Goosehead reported cash and cash equivalents of $47.5 million. Net cash provided by operating activities for the nine months was $59.0 million, compared to $37.4 million in the previous year.
| Cash Flow Activity | 9M 2024 ($ thousands) | 9M 2023 ($ thousands) |
|---|---|---|
| Net Cash Provided by Operating Activities | 59,043 | 37,369 |
| Net Cash Used for Investing Activities | (9,278) | (14,609) |
| Net Cash Used for Financing Activities | (43,700) | (16,086) |
| Net Increase in Cash and Cash Equivalents | 6,065 | 6,674 |
Debt and Equity Structure
As of September 30, 2024, Goosehead’s total liabilities stood at $355.8 million. The company has a share repurchase program authorized for up to $100 million, with approximately $36.8 million remaining for future buybacks.
| Debt Maturity Schedule | 2024 ($ thousands) | 2025 ($ thousands) | 2026 ($ thousands) |
|---|---|---|---|
| Term Note Payable | 2,516 | 10,063 | 83,015 |
| Total | 95,594 |
How Goosehead Insurance, Inc (GSHD) Makes Money
Revenue Streams
Goosehead Insurance generates revenue primarily through three distinct categories: Core Revenue, Cost Recovery Revenue, and Ancillary Revenue.
Core Revenue
Core Revenue is derived from several key components:
- Renewal Commissions: These are highly predictable, higher-margin revenues managed by the service team. For Q3 2024, Renewal Commissions were $20.2 million, representing 26% of total Core Revenue.
- Renewal Royalty Fees: Also highly predictable, these fees increased significantly, reaching $38.1 million in Q3 2024, accounting for 49% of total Core Revenue.
- New Business Commissions: These commissions amounted to $6.2 million in Q3 2024, making up 20% of total Core Revenue.
- New Business Royalty Fees: This revenue was $7.0 million in Q3 2024, contributing 15% to total Franchise Revenues.
- Agency Fees: These fees were $2.0 million in Q3 2024, representing 6% of total Core Revenue.
The total Core Revenue for Q3 2024 was $73.5 million, a 16% increase from $63.1 million in Q3 2023.
Cost Recovery Revenue
Cost Recovery Revenue primarily consists of Initial Franchise Fees and Interest Income:
- Initial Franchise Fees: In Q3 2024, these fees were $1.4 million, down from $2.4 million in Q3 2023.
- Interest Income: This revenue was $0.2 million in Q3 2024, compared to $0.3 million in Q3 2023.
Total Cost Recovery Revenue for Q3 2024 was $1.6 million.
Ancillary Revenue
Ancillary Revenue includes less predictable sources such as Contingent Commissions and Other Franchise Revenues:
- Contingent Commissions: These commissions totaled $2.5 million in Q3 2024, a decline from $4.8 million in Q3 2023.
- Other Franchise Revenues: These revenues were $0.4 million in Q3 2024, slightly up from $0.3 million in Q3 2023.
Total Ancillary Revenue for Q3 2024 was $2.9 million.
Financial Performance Metrics
Goosehead's financial performance is also highlighted by the following metrics for Q3 2024:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Revenue | $78.0 million | $71.0 million |
| Net Income | $12.6 million | $11.3 million |
| Adjusted EBITDA | $26.1 million | $22.4 million |
| Policies in Force | 1,636,000 | 1,459,000 |
| Corporate Sales Headcount | 458 | 316 |
For the nine months ended September 30, 2024, total revenue was $220.6 million, an 11% increase from $198.3 million in the same period of 2023.
Written Premiums
Total Written Premiums, a crucial leading indicator of future revenue, increased significantly to $1.03 billion for Q3 2024, up from $0.80 billion in Q3 2023, marking a 28% increase.
The breakdown of Total Written Premiums for Q3 2024 was:
| Sales Channel | Q3 2024 | Q3 2023 |
|---|---|---|
| Corporate Sales | $204.0 million | $182.5 million |
| Franchise Sales | $824.7 million | $620.5 million |
Client Metrics
Client retention remained strong at 84% as of September 30, 2024. Additionally, Goosehead's Net Promoter Score (NPS) was recorded at 90, indicating high customer satisfaction.
Operating Expenses
Operating expenses for Q3 2024 totaled $61.6 million, reflecting an increase from $57.4 million in Q3 2023. Key components included:
- Employee Compensation and Benefits: $43.2 million
- General and Administrative Expenses: $15.2 million
- Depreciation and Amortization: $2.6 million
The net income attributable to Goosehead Insurance, Inc. for Q3 2024 was $7.6 million.
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Article updated on 8 Nov 2024
Resources:
- Goosehead Insurance, Inc (GSHD) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Goosehead Insurance, Inc (GSHD)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Goosehead Insurance, Inc (GSHD)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.