Palomar Q2 Earnings, Revenues Top Estimates, Premiums Rise Y/Y

Core Insights - Palomar Holdings Inc. (PLMR) reported a second-quarter 2025 operating income of $1.76 per share, exceeding the Zacks Consensus Estimate by 4.7%, with a year-over-year increase of 40.8% [2] - The company's total revenues rose 48.9% year over year to $195 million, driven by higher premiums and net investment income, also surpassing the Zacks Consensus Estimate by 4.7% [3] - Gross written premiums increased by 28.8% year over year to $496.3 million, while net earned premiums rose 47.2% to $164 million [3] Financial Performance - Net investment income surged 68% year over year to $13.4 million, primarily due to higher yields on invested assets and an increased average balance of investments [4] - Underwriting income reached $38.3 million, up 49.5% year over year, with adjusted underwriting income nearly at $48.4 million, reflecting a 47.1% increase [5] - Total expenses increased by 46.8% year over year to $143.3 million, attributed to higher loss and loss adjustment expenses, acquisition expenses, and other underwriting expenses [5] Ratios and Equity - The loss ratio was reported at 25.7, deteriorating by 80 basis points year over year, while the adjusted combined ratio, excluding catastrophe losses, was 73.1, deteriorating by 280 basis points [6] - Cash and cash equivalents increased by 1.1% from the end of 2024 to $81.3 million, and shareholder equity rose by 16.2% to $847.7 million [7] Capital Management - The board of directors approved a $150 million share repurchase program effective from July 31, 2025, to July 31, 2027 [8] Future Outlook - Palomar Holdings raised its 2025 adjusted net income guidance to a range of $198 million to $205 million, up from the previous outlook of $186 million to $200 million, factoring in estimated catastrophe losses of $8 million to $12 million for the remainder of the year [10]