Shares of Palomar (PLMR) have gained 1.7% over the past four weeks to close the last trading session at $121.68, but there could still be a solid upside left in the stock if short-term price targets of Wall Street analysts are any indication. Going by the price targets, the mean estimate of $165.67 indicates a potential upside of 36.2%.The average comprises six short-term price targets ranging from a low of $151.00 to a high of $183.00, with a standard deviation of $11.96. While the lowest estimate indicate ...

Catastrophe Risk and Reinsurance - The company has incurred significant losses from catastrophe events multiple times in its history, with the unpredictability of such events posing a risk to earnings and stockholders' equity [127]. - The company's reinsurance coverage currently exhausts at $3.1 billion for earthquake events and $100 million for continental U.S. hurricane events, with a retention of $20 million for earthquake events and $11 million for hurricane events [131]. - As of December 31, 2025, the company had $468.7 million of aggregate reinsurance recoverables, indicating reliance on reinsurance for risk management [133]. - The company closed a $525 million catastrophe bond in Q2 2025, effective June 1, 2025 through June 1, 2028, to enhance its reinsurance coverage for earthquake events [143]. - The company may face increased costs or limitations in purchasing reinsurance during hard market cycles, which could adversely impact its business and results of operations [142]. - The company is exposed to risks from unpredictable catastrophe events, including those caused by climate change, which could limit its ability to underwrite new insurance policies [124]. Competition and Market Position - The company faces intense competition in the insurance industry, which may result in pricing pressure and reduced underwriting margins [124]. - The company faces intense competition from larger specialty insurance companies and public enterprises, which may result in pricing pressure and reduced underwriting margins [170]. - Increased competition in the insurance industry may arise from new entrants and federal regulatory reforms, potentially affecting pricing and business retention [172]. Financial Performance and Risk Management - The reserve for losses and loss adjustment expenses is based on estimates and assumptions, which may prove inadequate, potentially impacting net income and stockholders' equity [134]. - The company relies on third-party data for risk modeling, which may lead to materially higher actual losses if estimates are incorrect [149]. - The company’s risk management approach relies on subjective variables and models that may not accurately predict actual outcomes, introducing uncertainty into loss estimates [151]. - The concentration of business in California exposes the company to greater regulatory and economic risks compared to insurers with a more diversified premium base [160]. - The company’s written premium in future years could be materially adversely affected if actual renewals of existing policies do not meet expectations [174]. Growth and Expansion - The company’s employee base has approximately doubled in the last twelve months, indicating significant growth and potential challenges in managing this expansion [181]. - Recent acquisitions include Gray Surety in January 2026 and FIA and AAP in 2025, which are part of the company’s strategy to expand its business [182]. - The company faces risks related to the evaluation and integration of acquired businesses, which could impact financial performance and operational efficiency [183]. Economic and Regulatory Environment - Economic downturns, particularly in California, could adversely affect the company’s financial condition and results of operations [196]. - The company is subject to extensive regulations that may adversely affect its ability to achieve business objectives and could result in penalties for non-compliance [224]. - U.S. insurance subsidiaries must maintain risk-based capital at required levels to avoid regulatory actions, including supervision or liquidation [228]. - The Bermuda subsidiary is subject to the Economic Substance Act 2018, which may require changes to business operations to comply with regulations [229]. Investment Risks - The company’s investment portfolio performance is subject to various risks, including interest rate fluctuations and credit quality considerations [199]. - The company faces risks from potential investment losses due to economic downturns, which could lead to impairments in the fixed income portfolio [207]. - The company may need to sell investments to meet liquidity requirements, which could result in significant realized losses depending on market conditions [210]. - The estimated fair value of the company's fixed maturities was $1.2 billion, with a 100-basis point increase in interest rates potentially causing a 3.8% decline in value [454]. - The company's fixed maturity portfolio has an average rating of "AA−," with approximately 71.3% rated "A−" or better, indicating a focus on high credit quality investments [452]. Cybersecurity and Compliance - Increased regulatory scrutiny around cybersecurity incidents could exacerbate potential harm to the company's business and reputation [217]. - The company is required to comply with cybersecurity regulations, which mandate the establishment and maintenance of a cybersecurity program [238]. - Compliance with the Sarbanes-Oxley Act and Dodd-Frank Act has increased regulatory demands and operating costs for the company [255]. - The company incurs significant costs as a public company, including legal and accounting expenses, which divert management's time from revenue-generating activities [253]. Legal and Tax Risks - The company faces risks associated with litigation, which could have an adverse effect on its business and financial condition [247]. - Changes in tax laws could negatively impact the company's results of operations and profitability by increasing tax expenses [241]. - The use of credit scoring in pricing and underwriting is subject to legal and regulatory scrutiny, which could decrease profitability if restrictions are enacted [248]. Dividend Policy - The company does not intend to declare and pay cash dividends in the foreseeable future, relying on its insurance subsidiaries for any potential dividends [244].

LA JOLLA, Calif., Feb. 23, 2026 (GLOBE NEWSWIRE) -- Palomar Holdings, Inc. (NASDAQ: PLMR) (“Palomar”) today announced that Mac Armstrong, Chairman and Chief Executive Officer, and Chris Uchida, Chief Financial Officer, will host a fireside chat at the 47th Annual Raymond James Institutional Investors Conference on Monday, March 2, 2026, at 2:15 pm ET. Management will also be available for one-on-one and small group meetings with investors. Interested investors and other parties can access a live webcast of ...

Investor Presentation February 2026 plmr.com Disclaimer This presentation contains forward-looking statements about Palomar Holdings, Inc. (the "Company"). These statements involve known and unknown risks that relate to the Company's future events or future financial performance and the actual results could differ materially from those discussed in this presentation. This presentation also includes financial measures which are not prepared in accordance with generally accepted accounting principles ("GAAP") ...

Financial Data and Key Metrics Changes - In 2025, the company achieved record levels of gross written premium and adjusted net income, with gross written premium increasing by 32% and adjusted net income rising by 62% to $216 million, exceeding initial guidance of $180 million-$192 million [4][31] - The adjusted return on equity for the full year was 26%, with an adjusted combined ratio of 72.7%, an improvement from 73.7% in 2024 [30][31] - For Q4 2025, adjusted net income was $61.1 million, or $2.24 per share, representing a 48% increase from Q4 2024 [23][24] Business Line Data and Key Metrics Changes - The earthquake franchise saw a 2% decline year-over-year, attributed to a one-time headwind from a large unearned premium transfer in Q4 2024, while the residential earthquake book performed well with a premium retention rate of 97% [8][9] - The Inland Marine and other property group grew by 30% year-over-year, driven by strong performance in admitted and E&S Builders Risk products [10] - The casualty business experienced a 120% year-over-year growth in gross written premium, ending 2025 at 20% of total gross written premium [13][14] Market Data and Key Metrics Changes - The commercial earthquake book faced a 15% rate decrease due to elevated competition, while the residential earthquake book continued to grow, expected to achieve high single digits to double digits growth [9][48] - The crop franchise generated $248 million in gross written premium, exceeding expectations, with a projected growth of over 30% in 2026 [16][17] Company Strategy and Development Direction - The company executed four strategic imperatives in 2025: integrate and operate, build new market leaders, remember preferences, and generate consistent earnings [5] - For 2026, the company aims to leverage scale for profitable growth, curate a distinct portfolio, deepen market positions, and integrate AI for operational efficiency [21][22] - The acquisition of Gray Surety is expected to strengthen the surety franchise and provide diversification to the earnings base [19][34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining growth momentum, with 2026 adjusted net income guidance set at $260 million-$275 million, implying a 24% growth [20][32] - The company anticipates modest premium growth and margin expansion in the earthquake book despite ongoing commercial pressure [10][49] - Management remains conservative in managing casualty exposure and reserves, with a focus on maintaining balance sheet strength [15] Other Important Information - The company reported a net investment income of $16 million for Q4 2025, a 41.3% increase year-over-year, driven by higher yields on invested assets [28][29] - The company plans to reconstitute product groups, with fronting no longer being a standalone category, and will report on five product categories going forward [18][35] Q&A Session Summary Question: Higher retention on crop and its contribution to earnings - Management indicated that retaining more in crop could add approximately $8 million of pre-tax income for every $100 million retained, with a combined ratio expected in the low 90s [38] Question: 10% reduction in reinsurance costs - The reduction is on a risk-adjusted basis, assuming like-for-like exposure [39] Question: Growth expectations from new underwriting hires - Management noted that growth contributions from new hires depend on the market they enter, with a focus on moderate growth and strong reinsurance support [42][44] Question: Breakdown of earthquake growth - The residential earthquake book is expected to grow while the commercial book faces pressure, with management anticipating high single digits to double digits growth for residential [48] Question: Loss ratio expectations - Management expects the loss ratio to be in the mid- to upper 30s for 2026, influenced by increased retention in crop and growth in that segment [50][54] Question: Capital deployment opportunities - Management indicated a focus on organic growth, increased retention, and opportunistic share buybacks, with a balanced approach to capital allocation [71][73]

Financial Data and Key Metrics Changes - In 2025, the company achieved record levels of gross written premium and adjusted net income, with gross written premium increasing by 32% and adjusted net income rising by 62% to $216 million, exceeding initial guidance of $180 million-$192 million [4][31] - The adjusted return on equity for the full year was 26%, with an adjusted combined ratio of 72.7%, compared to 73.7% in 2024 [30][31] - For Q4 2025, adjusted net income was $61.1 million, or $2.24 per share, representing a 48% increase from Q4 2024 [23][24] Business Line Data and Key Metrics Changes - The earthquake franchise saw a 2% decline year-over-year, attributed to a one-time headwind from a large unearned premium transfer in Q4 2024, while the residential earthquake book grew, maintaining a premium retention rate of 97% [8][9] - The Inland Marine and other property group grew by 30% year-over-year, driven by strong performance in admitted and E&S Builders Risk products [10] - The casualty business experienced a 120% year-over-year growth in gross written premium, ending 2025 at 20% of total gross written premium [13][14] Market Data and Key Metrics Changes - The commercial earthquake book faced a 15% rate decrease due to elevated competition, while the residential earthquake book showed strong retention and new business growth [9][10] - The crop franchise generated $248 million in gross written premium, exceeding expectations, with a projected growth of over 30% in 2026 [16][17] Company Strategy and Development Direction - The company executed four strategic imperatives in 2025: integrate and operate, build new market leaders, remember preferences, and generate consistent earnings [5][6] - For 2026, the company aims to leverage scale for profitable growth, curate a distinct portfolio, deepen market positions, and integrate AI for operational efficiency [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining growth and profitability, with a 2026 adjusted net income guidance of $260 million-$275 million, implying a 24% growth [20][32] - The company anticipates modest premium growth and margin expansion in the earthquake book despite ongoing commercial pressure [10][49] Other Important Information - The company closed the acquisition of Gray Surety, which is expected to strengthen its surety franchise and contribute to long-term growth [19][34] - The company plans to reconstitute product groups, with fronting no longer being a standalone category [18] Q&A Session Summary Question: Higher retention on crop and its contribution to earnings - Management indicated that retaining more in crop could add approximately $8 million of pre-tax income for every $100 million retained, with a combined ratio expected in the low 90s [38] Question: 10% reduction in reinsurance costs - The reduction is on a risk-adjusted basis, assuming like-for-like exposure [39] Question: New hires and their expected contribution to growth - Management noted that new hires are expected to contribute to growth, but the impact will depend on the market conditions they enter [42][43] Question: Breakdown of earthquake growth - The residential earthquake book is expected to grow in the high single digits to double digits, offsetting pressure in the commercial segment [48][49] Question: Loss ratio expectations - Management expects the loss ratio to be in the mid- to upper 30s for 2026, influenced by the growth in the crop business [50][52] Question: Capital deployment opportunities - Management indicated a focus on organic growth, increased retention, and opportunistic M&A, with share buybacks also being considered [69][70]

Financial Data and Key Metrics Changes - In 2025, the company achieved record levels of gross written premium and adjusted net income, with gross written premium increasing by 32% to $2 billion and adjusted net income growing by 62% to $216 million [4][28][29] - The adjusted return on equity for the full year was 25.9%, compared to 22.2% in 2024, indicating strong profitability [29] - For Q4 2025, adjusted net income was $61.1 million, or $2.24 per share, representing a 48% increase from $41.3 million, or $1.52 per share, in Q4 2024 [22][24] Business Line Data and Key Metrics Changes - The earthquake franchise saw a 2% decline year-over-year, primarily due to a one-time headwind from a large unearned premium transfer in Q4 2024 [7] - The Inland Marine and other property group grew by 30% year-over-year in Q4, driven by strong performance in Builders Risk and flood products [9] - The casualty business experienced a 120% year-over-year growth in gross written premium in Q4, ending 2025 at 20% of total gross written premium [11][12] Market Data and Key Metrics Changes - The commercial earthquake book faced a 15% rate decrease, with competition remaining elevated, while the residential earthquake book maintained a healthy premium retention rate of 97% [8][9] - The crop franchise generated $248 million in gross written premium in 2025, exceeding expectations, with a projected growth of over 30% in 2026 [14][15] Company Strategy and Development Direction - The company executed four strategic imperatives in 2025: integrate and operate, build new market leaders, remember preferences, and generate consistent earnings [5] - For 2026, the company aims to leverage scale for profitable growth, curate a distinct portfolio, deepen market positions, and integrate AI for operational efficiency [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining the Palomar 2X target, with adjusted net income guidance for 2026 set at $260 million-$275 million, implying a 24% growth [18][30] - The company anticipates modest premium growth and margin expansion in the earthquake book despite ongoing commercial pressure [9][46] Other Important Information - The company successfully integrated two specialty franchises and closed the acquisition of Gray Casualty & Surety, which is expected to strengthen its surety franchise [5][17] - The adjusted combined ratio for the full year was 72.7%, with expectations for it to be in the mid-70s for 2026 [31] Q&A Session Summary Question: Higher retention on crop and its contribution to earnings - Management indicated that retaining more crop business will add approximately $8 million of pre-tax income for every $100 million retained, with a combined ratio expected in the low 90s [35][36] Question: 10% reduction in reinsurance costs - The 10% reduction is on a risk-adjusted basis, assuming like-for-like exposure [37] Question: Growth expectations from new underwriting hires - Management noted that growth contributions from new hires depend on the market they enter, with a focus on moderate growth and strong reinsurance support [40][42] Question: Breakdown of earthquake growth - The residential earthquake book is expected to grow in the high single digits to double digits, while commercial earthquake will face continued pressure [45][46] Question: Long-term returns on equity with changing business mix - Management believes it can maintain an ROE above 20% while achieving the Palomar 2X target, despite changes in the business mix [80]

Core Insights - Palomar Holdings, Inc. (PLMR) reported a strong fourth-quarter 2025 performance with operating income of $2.24 per share, exceeding the Zacks Consensus Estimate by 9% and reflecting a year-over-year increase of 47.4% [1][9] - Total revenues surged 59.9% year over year to $251 million, driven by higher premiums, commissions, and other income, surpassing the Zacks Consensus Estimate by 13.1% [1][2] Financial Performance - Gross written premiums increased by 31.8% year over year to $492.6 million, although this fell short of the estimate of $590.6 million [5] - Net earned premiums rose 61.1% year over year to $233.5 million, exceeding both the estimate of $197.9 million and the Zacks Consensus Estimate of $205.6 million [5] - Net investment income climbed 41.3% year over year to $16 million, driven by higher yields and a larger average investment balance, surpassing estimates [6] - Adjusted underwriting income reached $62.3 million, a 51.8% increase from the prior year, while reported underwriting income rose 55.7% to $54.4 million, exceeding the estimate of $46.5 million [7] - Total expenses increased by 63.1% year over year to $180.7 million, driven by higher losses and acquisition costs, exceeding the estimate of $152.1 million [7] Ratios and Guidance - The loss ratio improved to 30.4%, down 470 basis points year over year, better than the estimate of 37.9% [8] - The adjusted combined ratio worsened by 170 basis points year over year to 73.4%, slightly above the Zacks Consensus Estimate of 73.1% [10] - For the full year 2025, Palomar reported operating revenues of $876 million, a 58.2% increase from 2024, and adjusted earnings of $7.86 per share, a 54.4% increase year over year [11] - The company raised its 2026 adjusted net income guidance to $260-$275 million from a previous range of $210-$215 million, factoring in expected catastrophe losses of $8-$12 million [13] Financial Position - Cash and cash equivalents rose 32.9% year over year to $106.9 million, while shareholders' equity increased by 29.3% to $942.7 million [12] - The annualized adjusted return on equity for 2025 was 25.9%, representing an expansion of 100 basis points year over year [12]

Core Insights - Palomar Holdings, Inc. reported a significant increase in net income, rising 60.6% to $56.2 million for Q4 2025 compared to $35 million in Q4 2024 [1] - The company achieved strong underwriting results, with gross written premiums (GWP) increasing by 31.8% to $492.6 million in Q4 2025, up from $373.7 million in Q4 2024 [3] - Net premiums written (NPW) rose by 46.3% to $247.6 million in Q4 2025, compared to $169.2 million in Q4 2024 [3] - Net premiums earned (NPE) increased 61.1% to $233.5 million in Q4 2025, compared to $144.9 million in Q4 2024 [3] Underwriting Performance - Underwriting income for Q4 2025 was $54.4 million, with a combined ratio of 76.8%, compared to $34.9 million and 75.9% for the same period in 2024 [4] - Losses and loss adjustment expenses for Q4 2025 totaled $70.9 million, including $72.9 million of attritional losses and $2.1 million of favorable development on catastrophe losses [4] - The loss ratio for the quarter was 30.4%, with an attritional loss ratio of 31.3% and a catastrophe loss ratio of -0.9%, compared to 25.7% in Q4 2024 [5] Investment Income - Palomar reported a net investment income increase of 41.3% to $16 million in Q4 2025, up from $11.3 million in Q4 2024, driven by higher yields on invested assets [6] Full-Year Results - For the full year 2025, GWP rose by 31.5% to $2 billion, compared to $1.5 billion in 2024 [7] - NPW increased by 49.5% to $964 million, compared to $644.8 million in 2024, while NPE rose by 57.2% to $802.6 million [7] - Underwriting income for the full year increased by 66.1% to $185.9 million compared to $111.9 million in 2024 [7] Annual Ratios - The total loss ratio for 2025 increased slightly to 28.5% from 26.4% in 2024, with the catastrophe loss ratio decreasing to -0.1% from 5.5% [8] - The FY 2025 combined ratio dipped to 76.9% compared to 78.1% in 2024 [8] - Net income for 2025 increased 67.6% to $197.1 million compared to $117.6 million in 2024 [8] Strategic Commentary - The CEO highlighted the strong fourth quarter results as a culmination of an exceptional 2025, with record adjusted net income and significant growth in gross written premiums [9] - The company emphasized its specialty product suite's capability to navigate market cycles and generate consistent returns, achieving an adjusted combined ratio of 73% and a 27% adjusted return on equity [10] - Notable accomplishments in 2025 included successful acquisitions and the addition of exceptional leaders, which are expected to sustain long-term profitable growth [11]

Core Insights - Palomar (PLMR) reported a revenue of $250.99 million for the quarter ended December 2025, marking a year-over-year increase of 59.9% and exceeding the Zacks Consensus Estimate by 13.07% [1] - The earnings per share (EPS) for the same period was $2.24, up from $1.52 a year ago, with an EPS surprise of 8.95% compared to the consensus estimate of $2.06 [1] Financial Performance Metrics - Loss Ratio stood at 30.4%, better than the five-analyst average estimate of 31% [4] - Combined Ratio was reported at 76.8%, slightly above the average estimate of 75.5% based on four analysts [4] - Expense Ratio was 46.4%, compared to the four-analyst average estimate of 44.5% [4] - Adjusted Combined Ratio was 73.4%, in line with the average estimate of 73.1% from two analysts [4] - Net Investment Income was $15.99 million, exceeding the average estimate of $15.34 million by 41.3% year-over-year [4] - Commission and Other Income reached $1.54 million, significantly higher than the estimated $1.1 million, representing a 105.5% year-over-year increase [4] - Net Earned Premiums totaled $233.46 million, surpassing the average estimate of $205.55 million, with a year-over-year change of 61.1% [4] Stock Performance - Palomar's shares have returned +1.3% over the past month, contrasting with a -0.3% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]