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Palomar's (PLMR) Q3 Earnings and Revenues Top Estimates
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Palomar Holdings, Inc. (PLMR - Free Report) reported third-quarter 2023 operating income of 80 cents per share, which beat the Zacks Consensus Estimate by 19.4%. The bottom line increased nearly threefold year over year.
Palomar witnessed improved premiums and net investment income as well as losses and loss adjustment expenses.
Behind the Headlines
Total revenues improved 10.8% year over year to $92 million, mainly attributable to higher premiums and net investment income. The top line beat the Zacks Consensus Estimate by 1.3%.
Palomar Holdings, Inc. Price, Consensus and EPS Surprise
Gross written premiums increased 24% year over year to $314 million. Our estimate was $255.8 million. Net earned premiums increased 10.1% year over year to $85.8 million. Our estimate was $84.3 million. The Zacks Consensus Estimate was pegged at $85 million.
Net investment income increased 61% year over year to $6 million, driven by higher yields on invested assets and a higher average balance of investments. The Zacks Consensus Estimate was pegged at $5.6 million. Our estimate was $5.1 million.
Palomar witnessed an underwriting income of $20.7 million, up more than fivefold year over year. Adjusted underwriting income was nearly $25 million, rising more than threefold year over year.
Total expenses of $66.4 million increased 12% year over year due to loss and loss adjustment expenses. Our estimate was $70.9 million.
The loss ratio was 18.8, which improved 2080 basis points (bps) year over year. Our estimate was 18.2. The Zacks Consensus Estimate was pegged at 26.6.
Adjusted combined ratio, excluding catastrophe losses, improved 1940 bps year over year to 70.9. The Zacks Consensus Estimate was pegged at 75.
Financial Update
Cash and cash equivalents declined 21.8% from 2022-end to $53.3 million at third-quarter 2023-end. Shareholder equity increased 9.5% from 2022-end to $421.3 million.
Annualized adjusted return on equity in the third quarter of 2023 was 22.3%, up 1240 bps year over year.
PLMR bought back shares worth $6.6 million in the third quarter of 2023. As of Sep 30, 2023, $43.5 million remained under authorization.
2023 View
Palomar aims to achieve adjusted net income in the range of $90 million to $93 million.
The Travelers Companies (TRV - Free Report) reported third-quarter 2023 core income of $1.95 per share, which missed the Zacks Consensus Estimate by 33.4%. The bottom line decreased 11.4% year over year, primarily attributable to higher catastrophe losses and net unfavorable prior-year reserve development. Travelers’ total revenues increased 14% from the year-ago quarter to $10.6 billion, primarily driven by higher premiums. The top-line figure beat the Zacks Consensus Estimate by 1.3%.
Net written premiums increased 14% year over year to a record $10.4 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $9.4 billion. Travelers witnessed an underwriting gain of $868 million, up 43% year over year, driven by record net earned premiums of $9.7 billion and a consolidated underlying combined ratio, which improved by 90.6%.
The Progressive Corporation’s (PGR - Free Report) third-quarter 2023 earnings per share of $2.09 beat the Zacks Consensus Estimate of $1.71. The bottom line improved more than fourfold year over year. Net premiums written were $15.6 billion in the quarter, which grew 20% from $13 billion a year ago and beat our estimate of $14.2 billion.
Net premiums earned grew 20% to $14.9 billion, beating our estimate of $13.6 billion and the Zacks Consensus Estimate of $14.8 billion. Net realized losses on securities were $149 million, narrower than a loss of $216.4 million in the year-ago quarter. The combined ratio — the percentage of premiums paid out as claims and expenses — improved 680 bps from the prior-year quarter’s level to 92.4.
RLI Corp. (RLI - Free Report) reported third-quarter 2023 operating earnings of 61 cents per share, beating the Zacks Consensus Estimate by 510%. The bottom line improved 22% from the prior-year quarter. Operating revenues for the reported quarter were $350.4 million, up 12.1% year over year, driven by 9.2% higher net premiums earned and 50.3% higher net investment income. The top line, however, missed the Zacks Consensus Estimate by 7.2%.
Gross premiums written increased 11.3% year over year to $449.3 million. Underwriting income of $4.2 million decreased 52.3%, primarily due to Hawaiian wildfire losses. The combined ratio deteriorated 170 basis points year over year to 98.7. Our estimate was 90.8.
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Palomar's (PLMR) Q3 Earnings and Revenues Top Estimates
Palomar Holdings, Inc. (PLMR - Free Report) reported third-quarter 2023 operating income of 80 cents per share, which beat the Zacks Consensus Estimate by 19.4%. The bottom line increased nearly threefold year over year.
Palomar witnessed improved premiums and net investment income as well as losses and loss adjustment expenses.
Behind the Headlines
Total revenues improved 10.8% year over year to $92 million, mainly attributable to higher premiums and net investment income. The top line beat the Zacks Consensus Estimate by 1.3%.
Palomar Holdings, Inc. Price, Consensus and EPS Surprise
Palomar Holdings, Inc. price-consensus-eps-surprise-chart | Palomar Holdings, Inc. Quote
Gross written premiums increased 24% year over year to $314 million. Our estimate was $255.8 million. Net earned premiums increased 10.1% year over year to $85.8 million. Our estimate was $84.3 million. The Zacks Consensus Estimate was pegged at $85 million.
Net investment income increased 61% year over year to $6 million, driven by higher yields on invested assets and a higher average balance of investments. The Zacks Consensus Estimate was pegged at $5.6 million. Our estimate was $5.1 million.
Palomar witnessed an underwriting income of $20.7 million, up more than fivefold year over year. Adjusted underwriting income was nearly $25 million, rising more than threefold year over year.
Total expenses of $66.4 million increased 12% year over year due to loss and loss adjustment expenses. Our estimate was $70.9 million.
The loss ratio was 18.8, which improved 2080 basis points (bps) year over year. Our estimate was 18.2. The Zacks Consensus Estimate was pegged at 26.6.
Adjusted combined ratio, excluding catastrophe losses, improved 1940 bps year over year to 70.9. The Zacks Consensus Estimate was pegged at 75.
Financial Update
Cash and cash equivalents declined 21.8% from 2022-end to $53.3 million at third-quarter 2023-end. Shareholder equity increased 9.5% from 2022-end to $421.3 million.
Annualized adjusted return on equity in the third quarter of 2023 was 22.3%, up 1240 bps year over year.
PLMR bought back shares worth $6.6 million in the third quarter of 2023. As of Sep 30, 2023, $43.5 million remained under authorization.
2023 View
Palomar aims to achieve adjusted net income in the range of $90 million to $93 million.
Zacks Rank
Palomar 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 third-quarter 2023 core income of $1.95 per share, which missed the Zacks Consensus Estimate by 33.4%. The bottom line decreased 11.4% year over year, primarily attributable to higher catastrophe losses and net unfavorable prior-year reserve development. Travelers’ total revenues increased 14% from the year-ago quarter to $10.6 billion, primarily driven by higher premiums. The top-line figure beat the Zacks Consensus Estimate by 1.3%.
Net written premiums increased 14% year over year to a record $10.4 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $9.4 billion. Travelers witnessed an underwriting gain of $868 million, up 43% year over year, driven by record net earned premiums of $9.7 billion and a consolidated underlying combined ratio, which improved by 90.6%.
The Progressive Corporation’s (PGR - Free Report) third-quarter 2023 earnings per share of $2.09 beat the Zacks Consensus Estimate of $1.71. The bottom line improved more than fourfold year over year. Net premiums written were $15.6 billion in the quarter, which grew 20% from $13 billion a year ago and beat our estimate of $14.2 billion.
Net premiums earned grew 20% to $14.9 billion, beating our estimate of $13.6 billion and the Zacks Consensus Estimate of $14.8 billion. Net realized losses on securities were $149 million, narrower than a loss of $216.4 million in the year-ago quarter. The combined ratio — the percentage of premiums paid out as claims and expenses — improved 680 bps from the prior-year quarter’s level to 92.4.
RLI Corp. (RLI - Free Report) reported third-quarter 2023 operating earnings of 61 cents per share, beating the Zacks Consensus Estimate by 510%. The bottom line improved 22% from the prior-year quarter. Operating revenues for the reported quarter were $350.4 million, up 12.1% year over year, driven by 9.2% higher net premiums earned and 50.3% higher net investment income. The top line, however, missed the Zacks Consensus Estimate by 7.2%.
Gross premiums written increased 11.3% year over year to $449.3 million. Underwriting income of $4.2 million decreased 52.3%, primarily due to Hawaiian wildfire losses. The combined ratio deteriorated 170 basis points year over year to 98.7. Our estimate was 90.8.