1. Goosehead Insurance, Inc (NASDAQ:GSHD)
RSI: 33.45
Estimated average analysts’ upside: 25.90%
Last 5 years revenue CAGR: 32.77%
Number of Hedge Fund Holders: 25
Goosehead Insurance, Inc. (NASDAQ:GSHD) is an independent personal lines insurance agency that operates in the US through a hybrid model of corporate agents and franchises. The company offers a broad range of insurance products – including homeowners, auto, flood, umbrella, and specialty lines – by partnering with over 140 insurance carriers. GSHD’s advantage is based on a proprietary digital platform to streamline policy quoting and enhance agent productivity and client experience.
Goosehead Insurance, Inc. (NASDAQ:GSHD) delivered solid financial performance in Q1 2025, with total revenue growing 17%, Core Revenue growing 17%, Premium growing 22%, and adjusted EBITDA growing 32% on a YoY basis. The company has built a vast distribution network, including more than 400 corporate agents, 1,000 franchises, 2,500 total licensed agents in 48 states, and 200-plus carriers, with a current premium base of approximately $4 billion. Despite operating in what experts consider the hardest product market in 50 years, the company has shown steady growth in Premium, Revenue, and Earnings over the past 3 years, using the challenging market conditions as an opportunity to strengthen every aspect of their operations.
Goosehead Insurance, Inc. (NASDAQ:GSHD) is seeing tangible improvements in product availability and price stability in many geographies, with auto carriers showing an aggressive rebound in product availability and new home products beginning to reenter multiple key markets. Management has implemented strategic initiatives, including narrowing its franchise owner criteria, focusing on selected geographies, and targeting business professionals with capital to build multi-agent, multi-location businesses. The company has also made significant technological advancements, including rolling out their mobile app and implementing new technologies that allow their systems to ingest lead flow from multiple partners and route it to the best available agents. These improvements, combined with their strong carrier relationships and diversified geographic footprint, position them well for meaningful improvement in both product availability and price stability over the next 6 to 24 months.
Overall, GSHD ranks first on our list of oversold growth stocks to buy now. While we acknowledge the potential of GSHD to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than GSHD but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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