Company Announcement - Palomar Holdings, Inc. will release its second quarter 2025 results after market close on August 4, 2025, and will host a conference call on August 5, 2025, at 12:00 p.m. Eastern Time [1] - 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 August 5, 2025, and can be accessed until 11:59 p.m. on August 12, 2025 [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 [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 strong financial strength ratings, with PSIC, PSRE, and PESIC rated "A" (Excellent) and FIA rated "A-" (Stable) by A.M. Best [4]

Company Overview - Palomar Holdings, Inc. (PLMR) is currently experiencing significant activity in the options market, particularly with the Jan 16, 2025 $85.00 Call option showing high implied volatility, indicating potential for a major price movement [1] - The company holds a Zacks Rank 2 (Buy) in the Insurance - Property and Casualty Industry, which is positioned in the top 35% of the Zacks Industry Rank [3] Analyst Insights - Over the past 60 days, three analysts have raised their earnings estimates for the current quarter, while three have lowered theirs, resulting in a net increase in the Zacks Consensus Estimate from $1.65 to $1.68 per share [3] - The high implied volatility suggests that options traders are anticipating a significant price movement for Palomar Holdings, which could indicate an upcoming event that may lead to a rally or sell-off [2][4] Trading Strategy - Options traders often seek out options with high implied volatility to sell premium, a strategy that can capture decay and potentially reduce risk if the underlying stock does not move as much as expected [4]

Wall Street expects a year-over-year increase in earnings on higher revenues when Palomar (PLMR) reports results for the quarter ended June 2025. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.The earnings report might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may mo ...

Palomar (PLMR) has been beaten down lately with too much selling pressure. While the stock has lost 14.3% over the past four weeks, there is light at the end of the tunnel as it is now in oversold territory and Wall Street analysts expect the company to report better earnings than they predicted earlier.We use Relative Strength Index (RSI), one of the most commonly used technical indicators, for spotting whether a stock is oversold. This is a momentum oscillator that measures the speed and change of price m ...

Core Insights - Zacks Premium offers various tools for investors to enhance their stock market strategies, including daily updates, research reports, and stock screens [1] - The Zacks Style Scores provide a unique rating system for stocks based on value, growth, and momentum, helping investors identify securities with high potential for market outperformance [2][3] Zacks Style Scores - Each stock is rated from A to F based on value, growth, and momentum characteristics, with A being the highest score indicating better chances of outperforming the market [3] - The Value Score identifies attractive stocks using ratios like P/E, PEG, and Price/Sales, focusing on finding undervalued stocks [4] - The Growth Score assesses a company's future prospects through projected earnings and sales, targeting stocks with sustainable growth [5] - The Momentum Score helps investors capitalize on price trends, analyzing short-term price changes and earnings estimate shifts [6] VGM Score - The VGM Score combines the Value, Growth, and Momentum Scores, providing a comprehensive indicator for investors seeking a balanced approach [6] Zacks Rank Integration - The Zacks Rank utilizes earnings estimate revisions to guide investors, with 1 (Strong Buy) stocks historically yielding an average annual return of +23.62% since 1988, outperforming the S&P 500 [7][8] - Investors are encouraged to select stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for optimal investment potential [9][10] Company Spotlight: Palomar Holdings, Inc. - Palomar Holdings, Inc. is rated 2 (Buy) on the Zacks Rank and has a VGM Score of B, indicating strong investment potential [11] - The company is projected to achieve year-over-year earnings growth of 39.3% for the current fiscal year, supported by upward revisions in earnings estimates [12] - Palomar has an average earnings surprise of +16.4%, making it a strong candidate for growth investors [12]

Core Viewpoint - Investors are increasingly seeking growth stocks that demonstrate above-average growth potential, with Palomar (PLMR) being highlighted as a strong candidate due to its favorable growth metrics and Zacks Rank [1][2]. Group 1: Earnings Growth - Palomar has a historical EPS growth rate of 54%, with projected EPS growth of 39.3% for the current year, significantly outperforming the industry average of 2.8% [5]. Group 2: Cash Flow Growth - The company exhibits a year-over-year cash flow growth of 45.1%, which is substantially higher than the industry average of 14.3% [6]. - Over the past 3-5 years, Palomar's annualized cash flow growth rate has been 25.5%, compared to the industry average of 11.5% [7]. Group 3: Earnings Estimate Revisions - The current-year earnings estimates for Palomar have been revised upward, with the Zacks Consensus Estimate increasing by 0.5% over the past month [9]. - This positive trend in earnings estimate revisions contributes to Palomar's Zacks Rank of 1 (Strong Buy) and a Growth Score of B [10]. Group 4: Investment Potential - The combination of strong earnings growth, impressive cash flow growth, and favorable earnings estimate revisions positions Palomar as a potential outperformer and a solid choice for growth investors [11].

Core Insights - Palomar Holdings, Inc. (PLMR) has seen its shares increase by 85.4% over the past year, significantly outperforming its industry and broader market indices [1] - The company has a market capitalization of $4.12 billion and an average trading volume of 0.3 million shares over the last three months [1] Stock Performance - PLMR shares closed at $154.25, trading above the 200-day simple moving average of $122.68, indicating strong upward momentum [2] Valuation Metrics - PLMR shares are trading at a price-to-book value of 5.22X, which is considerably higher than the industry average of 1.57X, indicating a premium valuation [3] Growth Projections - The Zacks Consensus Estimate projects a 39.2% year-over-year increase in earnings per share for 2025, with revenues expected to rise by 42.5% to $782.98 million [4] - For 2026, earnings per share and revenues are estimated to increase by 17% and 26.3%, respectively, compared to 2025 estimates [4] Analyst Sentiment - Four out of six analysts covering PLMR have raised their earnings estimates for 2025, and three out of five have done so for 2026 in the past 30 days, leading to a 2% and 1.5% increase in consensus estimates for those years [10] Financial Strength - PLMR maintains a debt-free balance sheet and a strong capital position, with an adjusted net income guidance raised to $186-$200 million for 2025 [9][18] - The company has a return on equity of 20.5%, significantly higher than the industry average of 7.8%, and a return on invested capital of 19.9%, compared to the industry average of 5.9% [13] Growth Drivers - Factors driving growth include increasing policy volumes, strong retention rates, geographic expansion, and new partnerships, with crop insurance projected to contribute around $200 million in premiums by 2025 [15] - The company identifies Surety as a long-term growth opportunity, which is not correlated with traditional property and casualty insurance cycles [16] Investment Strategy - PLMR's risk transfer strategy helps mitigate exposure to catastrophic events, contributing to a stable business model [20] - The average target price for PLMR shares is $183, suggesting a potential upside of 19.31% from the last closing price [11]

Industry Overview - The Zacks Property and Casualty Insurance industry has shown strong performance in 2025, driven by better pricing, prudent underwriting, increased exposure, streamlined operations, a wider global presence, and a solid capital position [1] - The insurance industry has outperformed the Zacks S&P 500 composite, with a year-to-date increase of 7.1% compared to the S&P 500's growth of 4.4% [3] Market Dynamics - Global commercial insurance rates decreased by 3% in Q1 2025, marking the third consecutive quarterly decline after seven years of increases [4][9] - Despite the decline in rates, higher catastrophe losses are driving policy renewal rates, with a reported 3% rise in commercial insurance rates and a 4.9% increase in personal lines in Q1 2025 [6] Growth Projections - Deloitte Insights projects that gross premiums in the insurance market will exceed $722 billion by 2030, indicating significant growth potential [4][6] - The insurance industry is expected to generate around $4.7 billion in annual global premiums from AI-related insurance by 2032, with a CAGR of nearly 80% [12] Company Highlights Heritage Insurance Holdings, Inc. (HRTG) - HRTG has seen a year-to-date share price increase of 93.6% and is projected to have revenue growth of 4.6% and 7.3% for 2025 and 2026, respectively [16][17] - The company has delivered an average earnings surprise of 363.17% over the last four quarters [16] Palomar Holdings, Inc. (PLMR) - PLMR's shares have rallied 45.3% year to date, with revenue growth estimates of 42.5% and 26.3% for 2025 and 2026, respectively [19] - The company raised its adjusted net income guidance to a range of $186 million to $200 million for 2025 [18] Root, Inc. (ROOT) - ROOT's shares have increased by 76.7% year to date, with revenue growth estimates of 17.3% and 8.6% for 2025 and 2026, respectively [21] - The company has delivered an average earnings surprise of 208.89% over the last four quarters [21] HCI Group, Inc. (HCI) - HCI's shares have risen 29.7% year to date, with revenue growth estimates of 18.3% and 5.9% for 2025 and 2026, respectively [23][24] - The company has delivered an average earnings surprise of 42.13% over the last four quarters [23]

Core Insights - Palomar Holdings, Inc. has announced a strategic partnership with Neptune Flood, making Neptune the exclusive managing general agent for flood insurance [1][2] - The partnership aims to enhance flood insurance accessibility through Neptune's AI-driven technology and data science capabilities, providing a robust alternative to the National Flood Insurance Program [2][3] Company Overview - Palomar Holdings, Inc. operates several subsidiaries, including Palomar Specialty Insurance Company and Palomar Specialty Reinsurance Company, and is recognized for its innovative specialty insurance offerings across various product categories [4] - Neptune Flood is the largest private flood insurance provider in the U.S., with nearly 250,000 policies in force, and utilizes AI-driven underwriting to simplify the flood insurance process [5] Strategic Goals - The collaboration is expected to expand flood insurance availability and streamline the quoting and binding experience for Palomar's agents, enhancing coverage options for policyholders [3][2] - Both companies share a mission to close the flood insurance gap and make coverage more accessible nationwide [5][2]

Financial Performance & Growth - Palomar's Gross Written Premium (GWP) has shown substantial growth, increasing from $252 million in 2019 to $1.616 billion LTM (Last Twelve Months)[10] - The company's Adjusted Net Income has also increased significantly, from $8 million in 2019 to $157 million LTM[10] - Palomar's Q1 2025 GWP reached $442.2 million, a 20% year-over-year increase, or 37% on a same-store basis[58] - Adjusted net income for Q1 2025 was $51.3 million, representing an 85% year-over-year increase[58] - The company's adjusted return on equity for Q1 2025 was 27%[58] Strategic Initiatives - Palomar is pursuing a "2X Strategy" to double adjusted net income and achieve an adjusted ROE above 20%[13] - The company has made strategic acquisitions, including First Indemnity of America (FIA) and Advanced AgProtection (AAP), to expand its addressable market and add scale and diversification[22] - Palomar employs a diverse suite of risk transfer products, including excess of loss (XOL), quota share, and insurance-linked securities (ILS), to manage risk and reduce earnings volatility[29] Reinsurance & Risk Management - Palomar has a comprehensive property catastrophe reinsurance program effective June 1, 2025, with total ground-up earthquake coverage increased to approximately $3.5 billion[35, 38] - The company's earthquake reinsurance program includes $1.15 billion of earthquake limit via the Torrey Pines Re catastrophe bond program[38] - Continental US Hurricane coverage to $100 million and all perils excluding earthquake coverage to $85 million[37, 38] Guidance - Palomar raised its 2025 adjusted net income guidance to $195 million - $205 million[58] - The company anticipates adjusted net income growth of 50% based upon the midpoint of guidance and an adjusted ROE above 20%[42]