Will Palomar Holdings Pull Off a Surprise This Earnings Season?

Core Viewpoint - Palomar Holdings, Inc. (PLMR) is anticipated to show improvements in both revenue and earnings for the second quarter of 2025, with a revenue estimate of $186.21 million, reflecting a 42.1% year-over-year increase [1] Revenue and Earnings Estimates - The consensus estimate for PLMR's earnings per share is $1.68, indicating a year-over-year increase of 34.4% [2] - The earnings estimate has decreased by 1.2% over the past 60 days [2] Earnings Prediction Model - The earnings prediction model suggests a likely earnings beat for PLMR, supported by a positive Earnings ESP of +0.25% and a Zacks Rank of 3 (Hold) [3][4] Factors Influencing Q2 Results - PLMR's second-quarter earnings are expected to benefit from a fee-based revenue stream and increased policy volumes across various business lines, driven by new business with existing partners and strong premium retention [5] - The focus on the crop business is likely to have positively impacted performance, with premiums earned estimated at $172.4 million [6] Revenue Drivers - Total revenues are expected to be driven by premium increases, higher net investment income, and commission income [7] - The Zacks Consensus Estimate for premiums earned is $174 million, while investment income is estimated at $12.06 million [6] Expense and Loss Ratios - Total expenses are projected to rise due to higher losses, interest, and acquisition expenses, with an estimated total expense of $136.9 million [8] - The combined ratio is expected to be 78.9, aided by a reinsurance policy that limits catastrophe losses [7][9] - The expense ratio is estimated to be slightly higher at 43.4 [10]