Greenhaven Road Investment Management, LP on Hagerty, Inc.
Thesis
Hagerty's collectible-car insurance franchise benefits from strong customer loyalty, proprietary data, scale and unusually efficient distribution partnerships. Revenue compounded materially faster than salaries and administrative expenses from 2020 through 2025, while EBITDA increased roughly eightfold despite significant investment in technology and the State Farm partnership. Greenhaven believes management's 2026 guidance is conservative and expects operating leverage to resume more quickly than consensus assumes. State Farm-related written premiums are accelerating sharply as more states activate, while a nascent Geico referral relationship provides additional optionality. The fund's base-case 2027 EPS estimate is nearly 30% above consensus and its bull case is nearly 60% higher.
“The statutory data supports a rapid acceleration that consensus appears not to reflect.”
Key risks
- A severe hurricane season could impair underwriting results
- The State Farm rollout could continue to take longer than expected
- The Geico trial may not develop into a meaningful partnership