NASDAQ$GSHD

Goosehead Insurance Inc · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Reported a strong second quarter with revenue and earnings growth, driven by increased premiums and expense discipline.

Goosehead Insurance reported a strong second quarter in 2023, with a 31% increase in total revenue to $69.3 million. Net income improved to $7.2 million, and adjusted EBITDA reached $23.1 million, reflecting an 85% increase.

  • Total revenues grew organically 31% year-over-year to $69.3 million.
  • Core revenues increased 27% year-over-year to $61.0 million.
  • Net income improved to $7.2 million from $2.4 million in the prior year, with EPS increasing 825% and adjusted EPS increasing 161%.
  • Total written premiums placed increased 36% year-over-year to $767.3 million.

Headline financials

Total Revenue

$69.3M

Previous: $53M+30.7%
EPS (adj)

$0.41

Previous: $0.16+156.2%
Policies in Force

1.4M

Previous: 1.2M+20.8%
Client Retention

88.0%

Previous: 89.0%-1.1%
Capital Expenditures

-$3.53M

Previous: -$5.53M+36.1%
Free Cash Flow

$134K

Previous: -$5.19M+102.6%
Net Income

$3.67M

Previous: $342K+971.9%
Operating Income

$11.2M

Previous: $5.67M+97.5%
Gross Profit

$69.3M

Previous: $53M+30.7%
Cash & Equivalents

$19.1M

Previous: $31.1M-38.5%
Total Assets

$323M

Previous: $291M+10.9%
Stock-Based Comp

$5.87M

Previous: $5.17M+13.5%

Revenue & EPS history

Goosehead Insurance · Revenue · Quarterly

$69.3M

Q2 2023+30.7%vs Q2 2022
Beat estimate in 10 of 15 quarters(67%)
ActualEstimate

Revenue by segment

Goosehead Insurance · $58M total across 3 segments · Q1 2023

  • Core Revenue
    $52M+42.4%
  • Cost Recovery Revenue
    $3.46M+32.3%
  • Ancillary Revenue
    $2.51M+16.2%

Forward guidance

The Company is raising its outlook for full year 2023.

Tailwinds

  • Total written premiums placed for 2023 are expected to be between $2.87 billion and $2.99 billion, representing organic growth of 30% on the low end of the range to 35% on the high end of the range.
  • Total revenues for 2023 are expected to be between $260 million and $267 million, representing organic growth of 24% on the low end of the range to 28% on the high end of the range.
  • Adjusted EBITDA Margin is expected to expand for the full year 2023.
  • Company delivered outstanding second quarter results.
  • Restructuring of corporate sales team is now complete and is producing extraordinary results.

Headwinds

  • Adjusted EBITDA margin and a reconciliation to the most comparable GAAP metric are not provided because they cannot be calculated without unreasonable effort.
  • Conditions impacting insurance carriers or other parties with which Goosehead does business
  • The loss of one or more key executives or an inability to attract and retain qualified personnel
  • The failure to attract and retain highly qualified franchisees
  • There are risks and uncertainties described under the captions “1A. Risk Factors” in Goosehead’s Annual Report on Form 10-K for the year ended December 31, 2022

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

+1.7%

Avg return

Earnings day

+1.5%

Avg return

5 days after

+1.5%

Avg return

30 days after

43%

15 / 35 earnings

Positive

+25.8%

Q2 2024

Best reaction

-18.6%

Q4 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+11.5%+7.4%-8.6%
Q4 2025-6.4%-9.5%-16.2%
Q3 2025+8.1%+7.8%+3.9%
Q2 2025-0.5%+2.4%-6.7%
Q1 2025-12.0%-9.4%+2.7%
Q4 2024+15.9%+16.6%+14.2%
Q3 2024+13.2%+14.6%+32.2%
Q2 2024+25.8%+31.1%+19.0%
Q1 2024-11.5%-5.3%+7.2%
Q4 2023-18.6%-15.2%-19.7%
Q3 2023-5.8%-7.8%+4.3%
Q2 2023+4.5%+0.7%-10.1%
Q1 2023+7.3%+5.7%+0.6%
Q4 2022+17.5%+15.7%+29.4%
Q3 2022+15.2%+20.1%+15.0%
Q2 2022+20.4%+12.4%+10.8%
Q1 2022-3.2%+0.3%-9.4%
Q4 2021-0.8%+1.7%-10.8%
Q3 2021-4.2%-9.8%-12.3%
Q2 2021-6.5%-5.2%+8.1%
Q1 2021-3.2%-10.2%-20.9%
Q4 2020-10.6%-21.7%-30.6%
Q3 2020+14.5%+15.6%+14.8%
Q2 2020+21.7%+25.0%+18.9%
Q1 2020-0.1%+1.3%+4.3%
Q4 2019+1.7%+5.1%-6.9%
Q3 2019-16.9%-14.4%-20.8%
Q2 2019-3.7%-2.6%+2.7%
Q1 2019+16.6%+11.6%+22.3%
Q4 2018-7.6%-6.1%-0.1%
Q3 2017-11.9%-21.3%-26.3%
Q3 2018-11.6%-21.7%-29.6%
Q2 2017-4.8%-3.2%+15.6%
Q2 2018-3.2%-0.4%+10.8%
Q1 2018+7.7%+21.5%+43.5%
Q4 2017
Q1 2017

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