It has been about a month since the last earnings report for Arch Capital Group (ACGL Quick QuoteACGL - Free Report) . Shares have added about 10.5% in that time frame, outperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Arch Capital due for a pullback? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent catalysts for Arch Capital Group Ltd. before we dive into how investors and analysts have reacted as of late.

Arch Capital Q3 Earnings Beat, Revenues Miss Estimates

Arch Capital Group Ltd. reported third-quarter 2025 operating income of $2.77 per share, which beat the Zacks Consensus Estimate by 26.5%. The bottom line increased 39.2% year over year. The quarterly results of ACGL benefited from higher premiums at its Insurance segment, improved net investment income and a not-so-active cat environment.

Behind the Headlines

Gross premiums written declined 0.6% year over year to $5.4 billion.
Net premiums written declined 2.1% year over year to $4 billion on higher premiums written in its Insurance segment. 

Pre-tax net investment income increased 2.3% year over year to $408 million. The uptick was driven by growth in average invested assets, due in part to strong operating cash flows.  The Zacks Consensus Estimate was pegged at $413.5 million. Our estimate was $416.4 million.

Operating revenues of $4.7 billion rose 7.8% year over year, driven by higher net premiums earned, net investment income and other income. However, revenues missed the Zacks Consensus Estimate by 0.6%.

Pre-tax current accident year catastrophic losses for the company’s insurance and reinsurance segments, net of reinsurance and reinstatement premiums, were $72 million. Arch Capital’s underwriting income increased 61.9% year over year to $871 million. The combined ratio, the percentage of premiums paid out as claims and expenses, improved 680 basis points (bps) to 79.8. The Zacks Consensus Estimate was pegged at 84.

Segmental Results

Insurance: Gross premiums written increased 9.7% year over year to $2.6 billion. Net premiums written climbed 7.3% year over year to $2 billion, primarily reflecting business related to the MCE Acquisition. Our estimate was $1.9 billion. Underwriting income of $129 million was 7.5% higher than the year-ago number. Our estimate was $199.9 million. The combined ratio deteriorated 30 bps to 93.4. The Zacks Consensus Estimate was pegged at 94.5.

Reinsurance: Gross premiums written declined 9% year over year to $2.5 billion. Net premiums written declined 10.7% year over year to $1.7 billion, primarily due to the impact of two transactions in the year-ago quarter in the specialty line of business and the lower level of reinstatement premiums in the reported quarter. Our estimate was $2.2 billion. Underwriting income was $482 million, up 223.5% year over year. The combined ratio improved 1620 bps year over year to 76.1. The Zacks Consensus Estimate was pegged at 81.57.

Mortgage: Gross premiums written dipped 2.7% year over year to $330 million. Net premiums written decreased 2.8% year over year to $274 million and reflected lower U.S. monthly and single premium volume. Our estimate was $271.3 million. Underwriting income decreased 3.3% year over year to $260 million. The combined ratio deteriorated 130 bps to 13.5. The Zacks Consensus Estimate was pegged at 23.22.

Financial Update

Arch Capital exited the quarter with cash of $1.1 billion, which increased 8.6% from 2024-end. Debt was $2.7 billion as of Sept. 30, 2025, which remained unchanged from the end of 2024. As of Sept. 30, 2025, the book value per share was $62.32, up 17.3% from the 2024-end level.

Annualized operating return on average common equity expanded 70 bps year over year to 18.5%. Cash from operations of $2.2 billion increased 8.3% year over year. ACGL repurchased $732 million worth of shares in the third quarter of 2025.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in estimates revision.

VGM Scores

Currently, Arch Capital has a average Growth Score of C, however its Momentum Score is doing a bit better with a B. Charting a somewhat similar path, the stock has a score of A on the value side, putting it in the top 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Arch Capital has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

Performance of an Industry Player

Arch Capital belongs to the Zacks Insurance - Property and Casualty industry. Another stock from the same industry, W.R. Berkley (WRB Quick QuoteWRB - Free Report) , has gained 7.3% over the past month. More than a month has passed since the company reported results for the quarter ended September 2025.

W.R. Berkley reported revenues of $3.69 billion in the last reported quarter, representing a year-over-year change of +8.2%. EPS of $1.10 for the same period compares with $0.93 a year ago.

W.R. Berkley is expected to post earnings of $1.12 per share for the current quarter, representing a year-over-year change of -0.9%. Over the last 30 days, the Zacks Consensus Estimate has changed -1.1%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for W.R. Berkley. Also, the stock has a VGM Score of B.