Financial Performance - Net income for Q4 2025 was $56.2 million, or $2.06 per diluted share, up 60.6% from $35.0 million, or $1.29 per diluted share, in Q4 2024[2] - Adjusted net income for Q4 2025 increased 48.0% to $61.1 million, or $2.24 per diluted share, compared to $41.3 million, or $1.52 per diluted share, in Q4 2024[2] - For the full year 2025, net income increased 67.6% to $197.1 million, and adjusted net income rose 61.9% to $216.1 million[8] - Net income for Q4 2025 reached $56,165,000, up 60.6% from $34,965,000 in Q4 2024[36] - Adjusted net income for Q4 2025 was $61,116,000, reflecting a 48.0% increase from $41,292,000 in Q4 2024[36] - Basic earnings per share for the year ended December 31, 2025, were $7.40, up from $4.61 in 2024, indicating a 60.5% rise[42] - Diluted adjusted earnings per share for the year ended December 31, 2025, is $7.86, compared to $5.09 for the year ended December 31, 2024, reflecting a 54% growth[49] Premiums and Revenue - Gross written premiums rose 31.8% to $492.6 million in Q4 2025, compared to $373.7 million in Q4 2024[6] - Gross written premiums for the full year 2025 increased by 31.5% to $2,028,252,000 compared to $1,541,962,000 in 2024[37] - Net written premiums rose by 46.3% to $247,570,000 in Q4 2025 compared to $169,231,000 in Q4 2024[36] - Net earned premiums grew by 61.1% to $233,460,000 in Q4 2025 from $144,890,000 in Q4 2024[36] - Total underwriting revenue for Q4 2025 was $235,001,000, a 61.4% increase from $145,640,000 in Q4 2024[36] - Net earned premiums for the year ended December 31, 2025, were $802.635 million, up from $510.687 million in 2024, representing a 57.1% growth[42] Investment Performance - Net investment income for Q4 2025 increased 41.3% to $16.0 million, driven by higher yields on invested assets[11] - Net investment income for the full year 2025 was $56,005,000, a 56.3% increase from $35,824,000 in 2024[37] - The net investment income for the year ended December 31, 2025, was $(56,005) thousand, compared to $(35,824) thousand in 2024, reflecting a decline in investment performance[47] Ratios and Returns - The total loss ratio for Q4 2025 was 30.4%, up from 25.7% in Q4 2024, while the catastrophe loss ratio improved to -0.9% from 5.6%[8] - The combined ratio for Q4 2025 was 76.8%, slightly higher than 75.9% in Q4 2024, with an adjusted combined ratio of 73.4% compared to 71.7%[8] - Annualized return on equity for Q4 2025 was 24.7%, up from 19.5% in Q4 2024, while adjusted return on equity was 26.9%, compared to 23.1%[13] - Annualized adjusted return on equity for Q4 2025 was 26.9%, compared to 23.1% in Q4 2024, showing improved profitability[48] - Adjusted combined ratio for Q4 2025 is 76.8%, compared to 75.9% in Q4 2024[49] - Adjusted combined ratio excluding catastrophe losses for Q4 2025 is 74.2%, compared to 66.1% in Q4 2024[50] Growth and Acquisitions - The company successfully acquired Advanced Ag Protection and The Gray Casualty and Surety Company, contributing to its long-term growth strategy[5] - Total assets as of December 31, 2025, were $3,050,967,000, up from $2,262,220,000 as of December 31, 2024[39] - The company reported a total of $179,076,000 in losses and expenses for Q4 2025, up from $109,958,000 in Q4 2024[50] Catastrophe Management - Catastrophe losses for Q4 2025 were $2,063 thousand, a significant decrease from $8,122 thousand in Q4 2024, indicating better management of catastrophic events[45] - The total catastrophe losses for the year ended December 31, 2025, were $728,000, a significant reduction from $27,846,000 in 2024[49]

Core Insights - Palomar Holdings, Inc. reported a significant increase in net income for Q4 2025, reaching $56.2 million, or $2.06 per diluted share, compared to $35.0 million, or $1.29 per diluted share, in Q4 2024, marking a 60.6% increase in net income year-over-year [1][7] - The company achieved an adjusted net income of $61.1 million, or $2.24 per diluted share, for Q4 2025, up from $41.3 million, or $1.52 per diluted share, in Q4 2024, reflecting a 48.0% increase [1][7] - Gross written premiums grew by 31.8% to $492.6 million in Q4 2025, compared to $373.7 million in Q4 2024, while net earned premiums increased by 61.1% [5][7] Fourth Quarter 2025 Highlights - The company reported a record adjusted net income and strong growth in both top and bottom lines, with gross written premiums increasing by 32% and adjusted net income rising by 48% [4] - The adjusted combined ratio for Q4 2025 was 73.4%, compared to 71.7% in Q4 2024, indicating effective underwriting performance [8][7] - The annualized return on equity for Q4 2025 was 24.7%, up from 19.5% in the same period last year [11][7] Full Year 2025 Highlights - For the full year 2025, gross written premiums reached $2.0 billion, a 31.5% increase from $1.5 billion in 2024 [7][34] - Net income for the full year was $197.1 million, a 67.6% increase from $117.6 million in 2024, while adjusted net income rose by 61.9% to $216.1 million [7][34] - The total loss ratio for 2025 was 28.5%, compared to 26.4% in 2024, indicating a slight increase in losses relative to earned premiums [7][34] Underwriting Results - Underwriting income for Q4 2025 was $54.4 million, resulting in a combined ratio of 76.8%, compared to a combined ratio of 75.9% in Q4 2024 [8][7] - The company experienced a loss ratio of 30.4% in Q4 2025, up from 25.7% in Q4 2024, with a catastrophe loss ratio of -0.9% compared to 5.6% in the previous year [6][7] Investment Results - Net investment income increased by 41.3% to $16.0 million in Q4 2025, driven by higher yields on invested assets [9][7] - The company recorded net realized and unrealized gains of $2.4 million in Q4 2025, contrasting with losses of $1.2 million in the same period last year [9][7] Stockholders' Equity and Returns - Stockholders' equity rose to $942.7 million at the end of 2025, compared to $729.0 million at the end of 2024 [11][7] - The company did not repurchase any shares during the quarter, with approximately $112.7 million remaining available for future repurchases under the existing authorization [11][7] Full Year 2026 Outlook - For the full year 2026, the company anticipates achieving adjusted net income between $260 million and $275 million, including an estimate of $8 million to $12 million in catastrophe losses [12][7]

Core Viewpoint - Palomar Holdings, Inc. has successfully completed the acquisition of The Gray Casualty & Surety Company, enhancing its position in the surety sector with a total cash consideration of $300 million [1][2]. Group 1: Acquisition Details - The acquisition was initially announced in October 2025, with Palomar agreeing to acquire Gray Surety from Bernhard Capital Partners and The Gray Insurance Company for a total cash consideration of $300 million [2]. - The financing for the acquisition includes a $150 million revolving credit facility and a $300 million term loan [2]. Group 2: Financing Arrangements - U.S. Bank National Association and KeyBank National Association served as Joint Lead Arrangers and Joint Book Runners for the financing [3]. - U.S. Bank acted as Administrative Agent, while KeyBank served as Syndication Agent [3]. - Additional banks involved in the financing include Citizens Bank, The Huntington National Bank, PNC Bank, and Wells Fargo Bank, with JPMorgan Chase Bank participating in the term loan [3]. Group 3: Management Commentary - Mac Armstrong, Chairman and CEO of Palomar, expressed satisfaction with the successful closing of the acquisition, highlighting Gray Surety's exceptional management team [4]. - The transaction is expected to significantly strengthen Palomar's surety franchise, adding scale and geographic reach, and complementing existing operations [5]. - The acquisition aligns with Palomar's strategic framework aimed at building a market leader in the surety sector [5].

Core Viewpoint - Palomar Holdings, Inc. is set to release its fourth quarter and full year 2025 financial results on February 11, 2026, followed by a conference call on February 12, 2026, at 12:00 p.m. Eastern Time [1]. Group 1: Conference Call Details - The conference call can be accessed live by dialing 1-877-423-9813 for domestic callers and 1-201-689-8573 for international callers [2]. - A replay of the conference call will be available starting at 4:00 p.m. Eastern Time on February 12, 2026, and can be accessed by dialing 1-844-512-2921 for domestic callers and 1-412-317-6671 for international callers, with a passcode of 13758018 [2]. - The replay will be available until 11:59 p.m. Eastern Time on February 19, 2026 [2]. Group 2: Company Overview - Palomar Holdings, Inc. is the holding company for several subsidiaries, including Palomar Specialty Insurance Company, Palomar Specialty Reinsurance Company Bermuda Ltd., and others, providing a range of insurance services [4]. - The company operates in five product categories: Earthquake, Inland Marine and Other Property, Casualty, Fronting, and Crop [4]. - Palomar's insurance subsidiaries have received an "A" (Excellent) financial strength rating from A.M. Best [4].

Core Insights - BCP has successfully closed the sale of The Gray Casualty & Surety Company to Palomar Holdings, marking a significant milestone in its investment strategy [1][4] Group 1: Company Overview - BCP is a private equity management firm focused on services and infrastructure, established in 2013, with $6 billion in assets under management [6] - The Gray Casualty & Surety Company specializes in contract surety bonds for midsized and emerging contractors across the U.S., and is licensed in all 50 states [2][7] Group 2: Investment and Growth - BCP invested in Gray Surety in 2021, and since then, the company has experienced significant growth and expanded its national presence [2][4] - Gray Surety is recognized as a Top 50 surety carrier, maintaining a strong reputation among contractors [7] Group 3: Transaction Details - The sale of Gray Surety is one of three exits announced by BCP in the latter half of 2025, alongside the sales of Brown & Root Industrial Services and United Utility [3] - J.P. Morgan and Evercore acted as financial advisors for Gray Surety and Palomar, respectively, while Kirkland & Ellis LLP and DLA Piper LLP provided legal advisory services [4]

Core Viewpoint - Palomar Holdings, Inc. has successfully completed the acquisition of The Gray Casualty & Surety Company, enhancing its position in the surety sector and expanding its operational scale and geographic reach [1][3]. Acquisition Details - The acquisition of Gray Surety was effective as of January 31, 2026, and is expected to significantly strengthen Palomar's surety franchise [1][3]. - The transaction is part of Palomar's strategy to build a market leader in the surety sector, complementing its existing operations [3]. Financing Information - Palomar has secured new unsecured financing, which includes a $150 million revolving facility and a $300 million term loan [2]. - U.S. Bank National Association and KeyBank National Association acted as Joint Lead Arrangers and Joint Book Runners for the financing [2]. Company Overview - Palomar Holdings, Inc. operates through various subsidiaries, including Palomar Specialty Insurance Company and The Gray Casualty & Surety Company, among others [4]. - The company provides innovative specialty insurance across five product categories: Earthquake, Inland Marine and Other Property, Casualty, Fronting, and Crop [4]. - Palomar's insurance subsidiaries hold a financial strength rating of "A" (Excellent) from A.M. Best [4].

Core Insights - Palomar Holdings is a specialty property and casualty insurer that focuses on niche markets underserved by traditional carriers, leveraging disciplined underwriting and diversified distribution channels for profitable growth [4] Transaction Summary - On January 21, 2026, CEO Mac Armstrong sold 5,000 shares for approximately $645,000, representing 1.15% of his total ownership at that time [2][6] - Post-transaction, Armstrong holds 80,314 direct shares valued at about $10.4 million and 348,388 indirect shares [2] - The transaction was based on a weighted average purchase price of $129.00, with the post-transaction value calculated at a market close of $130.00 [2] Company Performance - For the trailing twelve months (TTM), Palomar Holdings reported revenue of $778.36 million and net income of $175.87 million [3] - As of January 31, 2026, the stock price was $123.59, reflecting a 1-year price change of 13.77% [3] Market Outlook - Despite a recent decline of approximately 8% in stock price, Wall Street remains bullish on Palomar Holdings due to the growth in the specialty insurance market and the increasing frequency of natural disasters [7]

Company Overview - Palomar Holdings, Inc. (PLMR) is a specialty insurance company focused on property and casualty products, including earthquake, inland marine, and excess and surplus lines [4] Analyst Ratings and Price Targets - JPMorgan raised the price target for PLMR to $155 from $145 while maintaining an Overweight rating, indicating confidence in the company's growth potential despite challenging industry fundamentals [2] - Keefe, Bruyette & Woods also raised its price target on PLMR to $171 from $170 and reiterated an Outperform rating, reflecting positive analyst sentiment towards the stock [3] Industry Context - The property and casualty (P&C) insurance industry is facing worsening fundamentals, but pricing, margin, and growth concerns appear to be largely priced in according to analysts [2]

Core Viewpoint - Palomar (PLMR) is showing potential as a strong investment opportunity due to its recent technical performance and positive earnings revisions [1][3]. Technical Analysis - PLMR has recently crossed above the 200-day moving average, indicating a long-term bullish trend [1]. - The stock has gained 17.9% over the past four weeks, suggesting strong momentum [2]. Earnings Estimates - There have been no downward revisions in earnings estimates for the current fiscal year in the past two months, while five estimates have been revised upward [3]. - The consensus estimate for PLMR has also increased, reinforcing the bullish outlook for the stock [3]. Market Position - PLMR is currently ranked as a Zacks Rank 2 (Buy), indicating strong potential for further price appreciation [2].

Core Insights - The article emphasizes the focus on value investing in Asia, particularly in Hong Kong, targeting stocks with significant discrepancies between market price and intrinsic value [1] - It highlights two main categories of investment opportunities: deep value balance sheet bargains and wide moat stocks, which are characterized by their strong competitive advantages [1] Group 1: Investment Strategy - The investment strategy involves seeking deep value balance sheet bargains, such as net cash stocks and low price-to-book (P/B) ratio stocks [1] - The strategy also includes identifying wide moat stocks, which are high-quality businesses with sustainable competitive advantages [1] Group 2: Research Service - The research service, Asia Value & Moat Stocks, provides value investors with ideas and monthly updates on potential investment opportunities in the Asian equity market [1] - The service is led by an analyst with over a decade of experience in both buy and sell sides of the market, specializing in Asian equities [1]