Company Overview
Goosehead Insurance, Inc. functions as a holding company for Goosehead Financial, LLC, which specializes in providing personal lines insurance agency services across the United States market. The company operates within the Financial Services sector, specifically classified under the Insurance Brokers industry, a classification that defines its role as an intermediary connecting policyholders with insurance carriers rather than underwriting risk directly. Goosehead Insurance holds a market capitalization of $1.55B and reports an annual revenue of $364.63M, supported by an operational workforce of 1600 employees. These valuation and revenue figures indicate that the company maintains a significant position within the specialized insurance brokerage landscape, reflecting a substantial asset base relative to its peer group in the personal lines insurance space.
Financial Health
The company reported a revenue of $364.63M for the trailing twelve months, generating a net income of $27.83M and an EBITDA of $89.74M during the same period. The substantial gap between the $364.63M revenue and the $27.83M net income reveals a cost structure where operating expenses, including commissions, acquisition costs, and administrative overhead, consume approximately 92.4% of total revenue before arriving at the bottom line. Goosehead Insurance produced a free cash flow of $57.33M, which provides the organization with significant financial flexibility to manage capital expenditures or service its debt obligations without relying on external financing. The company's gross margin stands at 46.1%, indicating that it retains nearly half of its revenue as gross profit before accounting for operating costs. The operating margin is 29.3%, demonstrating that the company successfully covers its core operating expenses to generate nearly one-third of revenue as operating profit, while the profit margin of 7.6% reflects the final efficiency of the business model in converting sales into net earnings. On the balance sheet, Goosehead holds $34.39M in cash against $352.29M in total debt, and the debt-to-equity ratio is listed as N/A, suggesting a capital structure heavily reliant on debt or where equity is minimal relative to liabilities. The current ratio is 1.60, which indicates that the company possesses $1.60 in current assets for every $1.00 of current liabilities, signifying a healthy short-term liquidity position sufficient to meet immediate obligations. Return on Equity is N/A due to the specific accounting presentation, whereas Return on Assets is 12.1%, revealing that management effectively utilizes the company's total asset base to generate earnings.
Valuation Assessment
The trailing twelve-month P/E ratio is 40.38, while the forward P/E ratio is 15.78, a significant disparity that implies the market expects earnings growth in the future to drastically reduce the valuation multiple from current levels. The price-to-book ratio is -10.84, which indicates a market premium or valuation disconnect relative to book value, often seen in capital-light service businesses where assets do not fully reflect the intangible value of the agency network. The price-to-sales ratio is 4.24, and the EV/EBITDA stands at 14.33; these alternative metrics suggest that the market values the company based on its revenue generation and cash flow potential rather than traditional asset backing. The stock has a 52-week high of $127.99 and a 52-week low of $40.32, providing a wide trading range that highlights the asset's historical volatility. Although the exact current price is not explicitly listed in the provided facts, the metrics imply that the stock trades well below the 52-week high of $127.99 and above the 52-week low of $40.32, capturing a significant portion of the recent trading range. The beta value is 1.62, meaning the stock price is expected to exhibit 62% higher volatility than the broader market, reflecting its sensitivity to market movements and specific sector risks.
Growth & Income
Goosehead Insurance experienced a revenue growth rate of 12.2% year over year, whereas earnings growth was -15.7% for the same period. This divergence indicates that while top-line sales are expanding rapidly, profitability is currently contracting, implying that the company may be facing increased cost pressures, lower margins on new business, or one-time charges that are dampening net income growth despite revenue expansion. The company does not pay a dividend, evidenced by a dividend yield of N/A and a payout ratio of 0.0%, which means that earnings are retained entirely within the company to fund operations, expansion of the agency network, or debt reduction rather than being distributed to shareholders. Consequently, the overall growth and income profile is characterized by strong top-line expansion coupled with a lack of current income distribution, relying on future profitability improvements to support shareholder value creation.