HGTY · Hagerty, Inc.

The thesis

Hagerty's collector-car insurance business is growing well, but at the $17.97 close on 6 November 2026 the shares already reflect the raised 2026 outlook. The 2027 guidance due on the fourth-quarter call decides whether profit keeps growing without a $52 million benefit that management says will not recur.

The third-quarter report on 3 November 2026 was strong on its face. Policies in force rose 18.1% to 1,909,254, and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) rose 63.5% to $97.1 million. Hagerty raised its 2026 adjusted EBITDA guidance to $305–$315 million from $270–$280 million.

The quality of that raise is mixed. Earnings Whispers attributes about $26 million of the $35 million increase to a reserve reduction, leaving about $9 million from operations. Written premium growth also slowed to 16% in the third quarter from 19% in the second.

The narrative is maturing: the State Farm and Markel story is well known, and premium, membership and marketplace growth all cooled in the 3 November 2026 report even as the shares rose to a new high. Reported revenue fell 9.5% to $354.2 million, an accounting effect of Hagerty's reinsurer now taking all of the US risk under the Markel arrangement.

Bullish and bearish views on Hagerty, Inc.

The bull case on Hagerty, Inc. (HGTY), in brief: Policy growth remains in the double digits. The bear case: Reserve help drove much of the raise.

Bull case

• Policy growth remains in the double digits. Policies in force rose 18.1% and vehicles in force rose 13.4% to 3,105,819 at 30 September 2026, per the third-quarter release. Management repeated its goal of 3 million policies by 2030 on the 3 November 2026 call.
• State Farm distribution is still widening. State Farm's captive agents sold Classic Plus policies in 41 states at the third-quarter report, up from 37, according to Earnings Whispers. Conversion of State Farm's existing 525,000-policy Classic book was underway in 26 states at quarter-end, per call coverage from MarketBeat.
• Underwriting margins improved sharply. Hagerty Re, the company's reinsurer, posted a combined ratio of 79.7% in the third quarter against 89.6% a year earlier, and 85.2% for nine months against 89.3%. The combined ratio measures claims and expenses per premium dollar, so a reading under 100% is an underwriting profit.
• Markel transition costs are nearly finished. Pre-tax costs fell from $89 million in the first quarter to $64 million in the second and $36 million in the third, with about $10 million expected in the fourth. Hagerty raised its 2026 net income guidance to $48–$60 million from $18–$30 million on 3 November 2026.
• Cash exceeds debt by a wide margin. Unrestricted cash was $460.8 million at 30 September 2026 against about $247 million of debt, of which $103 million funds Broad Arrow Capital's collector-car loans. Nine-month operating cash flow rose 48% to $280.1 million.

Bear case

• Reserve help drove much of the raise. Year-to-date favorable loss development totaled $32 million, including $26 million in the third quarter, per the 3 November 2026 release. Hagerty Re has carried 100% of the US quota share, its share of premiums and losses, since 1 January 2026, up from 80%, so claims swings now reach results more directly.
• A $52 million benefit will not repeat. Management said on 3 November 2026 that the benefit from capitalizing acquisition costs is included in 2026 adjusted EBITDA guidance and "will not recur in 2027." That sets a harder comparison for next year's guidance.
• Growth rates are cooling across the business. Written premium growth slowed to 16% in the third quarter from 18% and 19% in the prior two quarters, and it came from policy count more than pricing. Hagerty Drivers Club paid-member growth cooled to 6.2% from 10%, and policy retention slipped to 88.2% from 88.6%.
• Collector-car prices may be peaking. Monterey auction sales across the industry reached a record $756 million in August 2026, up 75%. Management said on 3 November 2026 that it would be prudent not to assume high-end valuations keep rising. Marketplace revenue fell 6.4% to $32.2 million in the third quarter despite a 65.3% rise in auction sales, because inventory sales were lower.
• Partner carriers face a soft market. Management said on 3 November 2026 that soft personal auto and home markets are slowing new business at partner carriers. New insurance business rose 7.7% in the third quarter, against 56.1% for the nine months.
• Large holders have sold into strength. Hagerty Holding Corp. sold an upsized 9.25 million Class A shares at $11.95 in a September 2026 secondary offering, with net proceeds funding a share redemption for the Kim Hagerty Revocable Trust. Class V shares numbered 223,078,245 at 30 September 2026, against 120,569,434 Class A shares.

Price setup

The shares closed at $17.97 on 6 November 2026, 4.0% below the 52-week high of $18.71, after rising 40.6% over three months in adjusted daily closes. The 14-day relative strength index, a momentum gauge on a 0–100 scale, stood at 71.8. Readings above 70 are commonly treated as stretched.

Earnings Whispers put the last close before the report at $15.89, close to the prior 52-week high of $16.00 set on 27 October 2026. It also measured the shares at nearly 32% above their 200-day moving average before the report, a wide gap that the later rise has not closed. The stock trades as a less-followed growth story that re-rates on each report.

Analysts moved targets up after the report, on 4 November 2026. Wells Fargo's target rose to $17 from $14 with an Equal-Weight rating, and Truist's rose to $16 from $13 with a Hold rating. Citizens' target rose to $19 with a Market Outperform rating, the only one of the three above the close.

Catalysts, next 30 days

No company-scheduled report or investor event was found for the 30 days to 7 December 2026. A further stock sale by a large holder could come without notice, as the September offering did.

• ~4 March 2027, est. Fourth-quarter report and first 2027 guidance. Hagerty has not announced a date. Management said on 3 November 2026 that 2027 guidance will come on this call, and the case turns on it.

What would change the view

The business case breaks if Hagerty guides 2027 written premium growth below 10%, against 16%–17% guided for 2026. It also weakens if policy retention falls below 88.0% or if State Farm conversions remain in 26 states at the next report. A Hagerty Re combined ratio back above 89.6%, the third-quarter 2025 level, would show that the 2026 margin gain did not last.

On price, a daily close below $15.89 would erase the entire gain since the last close before the 3 November 2026 report and put the shares back under the prior $16.00 high.

The cautious read on the shares is wrong if 2027 adjusted EBITDA guidance reaches or exceeds the 2026 range of $305–$315 million without the $52 million benefit. Written premium growth guidance at or above 16% would point the same way.

What it trades with

The drivers are mostly specific to the company. High-end collector-car values feed Broad Arrow auction and private-sale activity, and insured values over time. The personal auto and home insurance cycle affects new business at partner carriers, as management said on 3 November 2026.

Interest rates also matter at the margin. Net investment income rose 25.3% to $12.7 million in the third quarter. Share supply is a separate influence, because the September 2026 secondary offering came from a large holder and brought Hagerty no proceeds.