On April 23, 2025, Goosehead Insurance Inc (GSHD, Financial) released its 8-K filing for the first quarter of 2025, showcasing a robust financial performance. The company, a rapidly growing independent personal lines insurance agency, reported a 17% increase in total revenue to $75.6 million compared to the same period last year. Net income rose to $2.6 million from $1.8 million, reflecting a 46% increase year-over-year.
Company Overview
Goosehead Insurance Inc operates as an insurance agency offering a wide range of products, including homeowner's, auto, flood, wind, earthquake, excess liability, specialty lines, commercial lines, and life insurance. The company operates across various regions, including Texas, California, Illinois, and Florida.
Financial Achievements and Challenges
The company's total written premium increased by 22% to $1.0 billion, indicating strong growth potential. However, the adjusted earnings per share (EPS) of $0.26 fell short of the prior year's $0.28, despite an increase in basic EPS from $0.07 to $0.09. This discrepancy highlights the impact of non-cash charges and adjustments on the company's profitability metrics.
Income Statement and Key Metrics
Goosehead Insurance Inc's core revenue, which excludes contingent commissions and other non-recurring income, grew by 17% to $69.1 million. This growth was driven by improved franchise productivity and a client retention rate of 84%. The company's adjusted EBITDA increased by 32% to $15.5 million, with an adjusted EBITDA margin of 21%, up from 18% in the prior-year period.
| Metric | Q1 2025 | Q1 2024 |
|---|---|---|
| Total Revenue | $75.6 million | $64.5 million |
| Net Income | $2.6 million | $1.8 million |
| Adjusted EBITDA | $15.5 million | $11.7 million |
| EPS | $0.09 | $0.07 |
Balance Sheet and Cash Flow
As of March 31, 2025, Goosehead Insurance Inc reported cash and cash equivalents of $70.2 million, with an unused line of credit of $75.0 million. The company's total liabilities stood at $558.1 million, with a significant portion attributed to a term note payable balance of $300.0 million.
Strategic Initiatives and Outlook
Goosehead Insurance Inc announced a new $100 million share repurchase authorization, reflecting confidence in its financial position and future growth prospects. The company continues to invest in its production force, technology initiatives, and AI-driven tools to enhance the personal lines experience for its stakeholders.
“At Goosehead, our strong growth comes from delivering exceptional value to clients, agents, and partners,” said Mark Miller, President and CEO. “We believe our runway is enormous and our competitive moat in the marketplace continues to expand.”
Overall, Goosehead Insurance Inc's Q1 2025 results demonstrate solid revenue growth and improved profitability, positioning the company well for future expansion in the competitive insurance market. Value investors may find the company's strategic initiatives and financial health appealing as it aims to capture a larger share of the U.S. personal lines market.
Explore the complete 8-K earnings release (here) from Goosehead Insurance Inc for further details.
