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Palomar (PLMR) Q1 Earnings Top, Revenues Miss Estimates
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Palomar Holdings, Inc. (PLMR - Free Report) reported first-quarter 2023 operating income of 80 cents per share, which beat the Zacks Consensus Estimate by 2.6% and came in line with our estimate. The bottom line increased 17.6% year over year.
Palomar witnessed improved premiums and net investment income, partly offset by higher losses and loss adjustment expenses and other underwriting expenses.
Palomar Holdings, Inc. Price, Consensus and EPS Surprise
Total revenues improved 12.2% year over year to $89.1 million, mainly attributable to higher premiums and net investment income. The top line however missed the Zacks Consensus Estimate by 3.1%. Our estimate was $90.3 million.
Gross written premiums increased 46.3% year over year to $250.1 million versus our estimate of $179.4 million. Net earned premiums increased 9.5% year over year to $83.2 million versus our estimate of $86.6 million.
Net investment income increased 98.5% year over year to $5.1 million, driven by higher returns on invested assets and a higher average balance of investments.
Palomar witnessed an underwriting income of $18.4 million, 2.8% higher than the year-ago income of $17 million. Adjusted underwriting income was $22.2 million, 4.7% higher than the year-ago figure.
Total expenses of $66.6 million increased 12.8% year over year due to higher losses and loss adjustment expenses, underwriting expenses and interest expenses. Our estimate was $68.4 million The loss ratio was 24.8, which deteriorated 510 basis points (bps) year over year.
Adjusted combined ratio, excluding catastrophe losses, deteriorated 120 bps year over year to 73.3.
Financial Update
Cash and cash equivalents increased 17.9% from 2022-end to $80.4 million at first-quarter 2023-end. Shareholder equity increased 5.2% from 2022-end to $404.6 million.
Annualized adjusted return on equity in 2022 was 20.7%, expanding 150 bps year over year. PLMR bought back shares worth $6.8 million in the first quarter of 2023. As of Mar 31, 2023, $58.8 million remained under authorization.
2023 View
Palomar aims to achieve adjusted net income in the range of $86 million to $90 million.
Zacks Rank
PLMR Financial currently has a Zacks Rank #4 (Sell).
The Travelers Companies (TRV - Free Report) reported first-quarter 2023 core income of $4.11 per share, which beat the Zacks Consensus Estimate of $3.64 and our estimate of $3.41. However, the bottom line decreased 2.6% year over year. Travelers’ total revenues increased 10% from the year-ago quarter to $9.7 billion, primarily driven by higher premiums. The top-line figure however missed the Zacks Consensus Estimate of $9.8 billion.
Net written premiums increased 12% year over year to a record $9.4 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $8.9 billion.
Catastrophe losses totaled $422 million, wider than $36 million pre-tax in the prior-year quarter. Catastrophe losses primarily resulted from severe wind and hail storms in multiple states. Travelers witnessed an underwriting gain of $501 million, down 12.9% year over year. The combined ratio deteriorated 410 bps year over year to 95.4.
The Progressive Corporation’s (PGR - Free Report) first-quarter 2023 earnings per share of 65 cents missed the Zacks Consensus Estimate of $1.44 as well as our estimate of $1.50. The bottom line declined 20.7% year over year.
Operating revenues were about $14.2 billion, up 15.8% year over year. This improvement was driven by a 15% increase in premiums, 18.5% higher fees and other revenues, a 7.1% increase in service revenues and a 73.2% higher investment income. The top line exceeded the Zacks Consensus Estimate of $14.1 billion and our estimate of $13.1 billion.
Net premiums earned grew 15% to $13.5 billion and beat our estimate of $12.6 billion. The combined ratio deteriorated 450 bps from the prior-year quarter’s level to 99.
RLI Corp. (RLI - Free Report) reported first-quarter 2023 operating earnings of $1.63 per share, beating the Zacks Consensus Estimate by 34.7%. The bottom line improved 14% from the prior-year quarter. Operating revenues for the reported quarter were $335 million, up 19.4% year over year, driven by 14.3% higher net premiums earned and 51.5% higher net investment income. The top line however missed the Zacks Consensus Estimate by 2.2%.
Gross premiums written increased 15.6% year over year to $415 million. This uptick can be attributed to the solid performance of the Casualty (up 1%), Property (up 45%) and Surety segments (up 13.6%). Underwriting income of $67.9 million increased 14.1%, primarily due to higher profitability in its Property and Casualty segment. The combined ratio remained flat year over year at 77.9.
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Palomar (PLMR) Q1 Earnings Top, Revenues Miss Estimates
Palomar Holdings, Inc. (PLMR - Free Report) reported first-quarter 2023 operating income of 80 cents per share, which beat the Zacks Consensus Estimate by 2.6% and came in line with our estimate. The bottom line increased 17.6% year over year.
Palomar witnessed improved premiums and net investment income, partly offset by higher losses and loss adjustment expenses and other underwriting expenses.
Palomar Holdings, Inc. Price, Consensus and EPS Surprise
Palomar Holdings, Inc. price-consensus-eps-surprise-chart | Palomar Holdings, Inc. Quote
Behind the Headlines
Total revenues improved 12.2% year over year to $89.1 million, mainly attributable to higher premiums and net investment income. The top line however missed the Zacks Consensus Estimate by 3.1%. Our estimate was $90.3 million.
Gross written premiums increased 46.3% year over year to $250.1 million versus our estimate of $179.4 million. Net earned premiums increased 9.5% year over year to $83.2 million versus our estimate of $86.6 million.
Net investment income increased 98.5% year over year to $5.1 million, driven by higher returns on invested assets and a higher average balance of investments.
Palomar witnessed an underwriting income of $18.4 million, 2.8% higher than the year-ago income of $17 million. Adjusted underwriting income was $22.2 million, 4.7% higher than the year-ago figure.
Total expenses of $66.6 million increased 12.8% year over year due to higher losses and loss adjustment expenses, underwriting expenses and interest expenses. Our estimate was $68.4 million The loss ratio was 24.8, which deteriorated 510 basis points (bps) year over year.
Adjusted combined ratio, excluding catastrophe losses, deteriorated 120 bps year over year to 73.3.
Financial Update
Cash and cash equivalents increased 17.9% from 2022-end to $80.4 million at first-quarter 2023-end. Shareholder equity increased 5.2% from 2022-end to $404.6 million.
Annualized adjusted return on equity in 2022 was 20.7%, expanding 150 bps year over year. PLMR bought back shares worth $6.8 million in the first quarter of 2023. As of Mar 31, 2023, $58.8 million remained under authorization.
2023 View
Palomar aims to achieve adjusted net income in the range of $86 million to $90 million.
Zacks Rank
PLMR Financial currently has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
The Travelers Companies (TRV - Free Report) reported first-quarter 2023 core income of $4.11 per share, which beat the Zacks Consensus Estimate of $3.64 and our estimate of $3.41. However, the bottom line decreased 2.6% year over year. Travelers’ total revenues increased 10% from the year-ago quarter to $9.7 billion, primarily driven by higher premiums. The top-line figure however missed the Zacks Consensus Estimate of $9.8 billion.
Net written premiums increased 12% year over year to a record $9.4 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $8.9 billion.
Catastrophe losses totaled $422 million, wider than $36 million pre-tax in the prior-year quarter. Catastrophe losses primarily resulted from severe wind and hail storms in multiple states. Travelers witnessed an underwriting gain of $501 million, down 12.9% year over year. The combined ratio deteriorated 410 bps year over year to 95.4.
The Progressive Corporation’s (PGR - Free Report) first-quarter 2023 earnings per share of 65 cents missed the Zacks Consensus Estimate of $1.44 as well as our estimate of $1.50. The bottom line declined 20.7% year over year.
Operating revenues were about $14.2 billion, up 15.8% year over year. This improvement was driven by a 15% increase in premiums, 18.5% higher fees and other revenues, a 7.1% increase in service revenues and a 73.2% higher investment income. The top line exceeded the Zacks Consensus Estimate of $14.1 billion and our estimate of $13.1 billion.
Net premiums earned grew 15% to $13.5 billion and beat our estimate of $12.6 billion. The combined ratio deteriorated 450 bps from the prior-year quarter’s level to 99.
RLI Corp. (RLI - Free Report) reported first-quarter 2023 operating earnings of $1.63 per share, beating the Zacks Consensus Estimate by 34.7%. The bottom line improved 14% from the prior-year quarter. Operating revenues for the reported quarter were $335 million, up 19.4% year over year, driven by 14.3% higher net premiums earned and 51.5% higher net investment income. The top line however missed the Zacks Consensus Estimate by 2.2%.
Gross premiums written increased 15.6% year over year to $415 million. This uptick can be attributed to the solid performance of the Casualty (up 1%), Property (up 45%) and Surety segments (up 13.6%). Underwriting income of $67.9 million increased 14.1%, primarily due to higher profitability in its Property and Casualty segment. The combined ratio remained flat year over year at 77.9.