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Palomar Q2 Earnings Top on Higher Premiums, Investment Income Rise Y/Y
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Key Takeaways
PLMR beat Q2 earnings estimates on strong premium growth and higher investment income.
Net earned premiums surged, while elevated losses pushed the loss ratio and combined ratio higher.
Management reaffirmed 2026 adjusted net income guidance of $270-$280 million.
Palomar Holdings, Inc. (PLMR - Free Report) reported second-quarter 2026 operating income of $2.36 per share, which beat the Zacks Consensus Estimate by 11.3%. The bottom line increased 34.1% year over year.
Total revenues improved 57.9% year over year to $308 million, mainly driven by higher net earned premiums and investment income. The top line beat the Zacks Consensus Estimate by 7.4%.
Palomar delivered another quarter of strong premium and revenue growth, aided by robust net earned premiums and higher investment income. However, elevated losses and underwriting expenses weighed on underwriting margins, resulting in a higher combined ratio.
Palomar Holdings, Inc. Price, Consensus and EPS Surprise
Gross written premiums increased 27% year over year to $630.5 million, supported by growth across Casualty, Crop and Surety & Credit lines. The figure missed our estimate of $688 million.
Net earned premiums rose 59.5% year over year to $287 million, exceeding our estimate of $260 million and the Zacks Consensus Estimate of $266 million.
Net investment income climbed 49.2% year over year to $20 million, driven by higher yields on invested assets and a larger average investment balance, supported by strong operating cash flow. The figure surpassed both the Zacks Consensus Estimate of $18.2 million and our estimate of $18.8 million.
Palomar reported adjusted underwriting income of $67 million, marking a 38.4% increase from the prior-year level. Reported underwriting income grew 25.5% year over year to $48 million, surpassing our estimate of $17 million.
Total expenses rose 70.5% year over year to $244.6 million due to higher losses and loss adjustment expenses, increased acquisition costs, elevated underwriting expenses and higher interest expense. The figure was lower than our estimate of $248.9 million.
The loss ratio was 34.5%, deteriorating 880 basis points year over year. It was lower than our estimate of 37.8% and the Zacks Consensus Estimate of 35.5%.
The adjusted combined ratio worsened 360 basis points year over year to 76.7%, but was better than the Zacks Consensus Estimate of 78.4%.
PLMR’s Financial Update
Cash and cash equivalents declined 41.3% to $62.7 million from the 2025-end level.
Shareholders’ equity increased 4.1% to $980.9 million from the 2025-end level.
Annualized adjusted return on equity for the second quarter of 2026 was 26.3%, up 260 basis points year over year.
PLMR’s Capital Deployment
During the second quarter, the company repurchased 0.37 million shares for $41 million.
On July 30, 2026, Palomar's board declared its first quarterly cash dividend of 45 cents per share. The dividend is payable on Sept. 2, 2026, to shareholders of record as of Aug. 19, 2026.
PLMR’s 2026 Guidance
The company expects 2026 adjusted net income in the range of $270-$280 million, including estimated catastrophe losses of $8-$12 million.
Markel Group Inc. (MKL - Free Report) reported second-quarter 2026 adjusted operating income of $19.5 per share, which missed the Zacks Consensus Estimate by 10.4%. The bottom line deteriorated 25% year over year. Total operating revenues were $4 billion, up 0.1% year over year, surpassing the Zacks Consensus Estimate by 8.6%.
Earned premiums decreased 3% year over year to $2 billion in the second quarter. The figure was lower than the Zacks Consensus Estimate of $2.1 billion. Net investment income increased 11.4% year over year to $256.1 million in the second quarter, lower than the Zacks Consensus Estimate of $262 million.
Cincinnati Financial Corporation (CINF - Free Report) reported second-quarter 2026 operating income of $1.43 per share, which missed the Zacks Consensus Estimate by 21.4%. The bottom line declined 27.4% from the year-ago quarter. Total operating revenues for the second quarter were $3 billion, up 6.8% year over year. The figure, however, missed the Zacks Consensus Estimate by 1.4%.
Earned premiums climbed 6.3% year over year to $2.6 billion. The figure marginally missed the Zacks Consensus Estimate by 1.5%. Net investment income, net of expenses, increased 12% year over year to $319 million. The figure marginally beat the Zacks Consensus Estimate by 1.8%.
Everest Group, Ltd. (EG - Free Report) reported second-quarter 2026 operating earnings of $14.85 per share, which beat the Zacks Consensus Estimate by 1.8%. The bottom line declined 14.5% year over year.
Operating revenues of $3.96 billion decreased 11.8% year over year and missed the consensus estimate by 2.9%. Net premiums earned fell 12.6% to $3.49 billion, reflecting lower business volumes. Our estimate was $3.6 billion. Net investment income declined 1.7% year over year to $523 million due to lower alternative investment returns. Our estimate was $561.5 million.
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Palomar Q2 Earnings Top on Higher Premiums, Investment Income Rise Y/Y
Key Takeaways
Palomar Holdings, Inc. (PLMR - Free Report) reported second-quarter 2026 operating income of $2.36 per share, which beat the Zacks Consensus Estimate by 11.3%. The bottom line increased 34.1% year over year.
Total revenues improved 57.9% year over year to $308 million, mainly driven by higher net earned premiums and investment income. The top line beat the Zacks Consensus Estimate by 7.4%.
Palomar delivered another quarter of strong premium and revenue growth, aided by robust net earned premiums and higher investment income. However, elevated losses and underwriting expenses weighed on underwriting margins, resulting in a higher combined ratio.
Palomar Holdings, Inc. Price, Consensus and EPS Surprise
Palomar Holdings, Inc. price-consensus-eps-surprise-chart | Palomar Holdings, Inc. Quote
Behind the Headlines
Gross written premiums increased 27% year over year to $630.5 million, supported by growth across Casualty, Crop and Surety & Credit lines. The figure missed our estimate of $688 million.
Net earned premiums rose 59.5% year over year to $287 million, exceeding our estimate of $260 million and the Zacks Consensus Estimate of $266 million.
Net investment income climbed 49.2% year over year to $20 million, driven by higher yields on invested assets and a larger average investment balance, supported by strong operating cash flow. The figure surpassed both the Zacks Consensus Estimate of $18.2 million and our estimate of $18.8 million.
Palomar reported adjusted underwriting income of $67 million, marking a 38.4% increase from the prior-year level. Reported underwriting income grew 25.5% year over year to $48 million, surpassing our estimate of $17 million.
Total expenses rose 70.5% year over year to $244.6 million due to higher losses and loss adjustment expenses, increased acquisition costs, elevated underwriting expenses and higher interest expense. The figure was lower than our estimate of $248.9 million.
The loss ratio was 34.5%, deteriorating 880 basis points year over year. It was lower than our estimate of 37.8% and the Zacks Consensus Estimate of 35.5%.
The adjusted combined ratio worsened 360 basis points year over year to 76.7%, but was better than the Zacks Consensus Estimate of 78.4%.
PLMR’s Financial Update
Cash and cash equivalents declined 41.3% to $62.7 million from the 2025-end level.
Shareholders’ equity increased 4.1% to $980.9 million from the 2025-end level.
Annualized adjusted return on equity for the second quarter of 2026 was 26.3%, up 260 basis points year over year.
PLMR’s Capital Deployment
During the second quarter, the company repurchased 0.37 million shares for $41 million.
On July 30, 2026, Palomar's board declared its first quarterly cash dividend of 45 cents per share. The dividend is payable on Sept. 2, 2026, to shareholders of record as of Aug. 19, 2026.
PLMR’s 2026 Guidance
The company expects 2026 adjusted net income in the range of $270-$280 million, including estimated catastrophe losses of $8-$12 million.
Palomar’s Zacks Rank
PLMR currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Markel Group Inc. (MKL - Free Report) reported second-quarter 2026 adjusted operating income of $19.5 per share, which missed the Zacks Consensus Estimate by 10.4%. The bottom line deteriorated 25% year over year. Total operating revenues were $4 billion, up 0.1% year over year, surpassing the Zacks Consensus Estimate by 8.6%.
Earned premiums decreased 3% year over year to $2 billion in the second quarter. The figure was lower than the Zacks Consensus Estimate of $2.1 billion. Net investment income increased 11.4% year over year to $256.1 million in the second quarter, lower than the Zacks Consensus Estimate of $262 million.
Cincinnati Financial Corporation (CINF - Free Report) reported second-quarter 2026 operating income of $1.43 per share, which missed the Zacks Consensus Estimate by 21.4%. The bottom line declined 27.4% from the year-ago quarter. Total operating revenues for the second quarter were $3 billion, up 6.8% year over year. The figure, however, missed the Zacks Consensus Estimate by 1.4%.
Earned premiums climbed 6.3% year over year to $2.6 billion. The figure marginally missed the Zacks Consensus Estimate by 1.5%. Net investment income, net of expenses, increased 12% year over year to $319 million. The figure marginally beat the Zacks Consensus Estimate by 1.8%.
Everest Group, Ltd. (EG - Free Report) reported second-quarter 2026 operating earnings of $14.85 per share, which beat the Zacks Consensus Estimate by 1.8%. The bottom line declined 14.5% year over year.
Operating revenues of $3.96 billion decreased 11.8% year over year and missed the consensus estimate by 2.9%. Net premiums earned fell 12.6% to $3.49 billion, reflecting lower business volumes. Our estimate was $3.6 billion. Net investment income declined 1.7% year over year to $523 million due to lower alternative investment returns. Our estimate was $561.5 million.