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Palomar Q2 Earnings, Revenues Top Estimates, Premiums Rise Y/Y
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Key Takeaways
{\"0\":\"PLMR posted Q2 EPS of $1.76 and revenues of $195M, with both topping estimates and rising year over year.\",\"1\":\"Gross written premiums jumped 28.8% and net investment income surged 68% from the prior-year quarter.\",\"2\":\"Palomar lifted 2025 adjusted net income guidance to $198M and $205M, citing stronger-than-expected results.\"}
Palomar Holdings Inc. (PLMR - Free Report) reported second-quarter 2025 operating income of $1.76 per share, which beat the Zacks Consensus Estimate by 4.7%. The bottom line increased 40.8% year over year.
The quarter’s results benefited from the successful execution of Palomar 2X strategy, improved premiums and net investment income, higher yields on invested assets and solid underwriting income, offset by higher expenses.
Behind the Headlines
Total revenues improved 48.9% year over year to $195 million, mainly attributable to higher premiums and net investment income. The top line beat the Zacks Consensus Estimate by 4.7%.
Palomar Holdings, Inc. Price, Consensus and EPS Surprise
Gross written premiums increased 28.8% year over year to $496.3 million. Our estimate was $558.2 million.
Net earned premiums increased 47.2% year over year to $164 million. Our estimate was $172.4 million. The Zacks Consensus Estimate was pegged at $160 million.
Net investment income surged 68% year over year to $13.4 million. The increase was primarily driven by higher yields on invested assets and a higher average balance of investments held during the three months ended June 30, 2025 due to cash generated from operations and proceeds from the August 2024 public offering. The Zacks Consensus Estimate was pegged at $11.2 million. Our estimate was $9.6 million.
Palomar Holdings recorded an underwriting income of $38.3 million, up 49.5% year over year. Adjusted underwriting income was nearly $48.4 million, up 47.1% year over year.
Total expenses of $143.3 million increased 46.8% year over year due to higher loss and loss adjustment expenses, acquisition expenses and other underwriting expenses. Our estimate was $136.9 million.
The loss ratio was 25.7, which deteriorated 80 basis points (bps) year over year. Our estimate was 35.5. The Zacks Consensus Estimate was pegged at 26.9.
Adjusted combined ratio, excluding catastrophe losses, was 73.1, which deteriorated 280 bps year over year. The Zacks Consensus Estimate was pegged at 73.
Financial Update
Cash and cash equivalents increased 1.1% from 2024-end to $81.3 million at second-quarter 2025-end.
Shareholder equity increased 16.2% from 2024-end to $847.7 million at the end of the second quarter.
Annualized adjusted return on equity in the second quarter of 2025 was 23.7%, contracting 100 bps year over year.
Capital Deployment
The board of directors approved a $150 million share repurchase program effective July 31, 2025 through July 31, 2027.
2025 View
Palomar Holdings aims to achieve adjusted net income of $198 million to $205 million, up from PLMR’s initial outlook of adjusted net income of $186 million to $200 million. This range includes an estimate of $8 million to $12 million of catastrophe losses for the remainder of the year.
The Travelers Companies (TRV - Free Report) reported second-quarter 2025 core income of $6.51 per share, which beat the Zacks Consensus Estimate by 83.8%. Total revenues increased 6.7% from the year-ago quarter to $12.1 billion, primarily driven by higher premiums, improved net investment income, higher fee income and other revenues. The top-line figure, however, missed the Zacks Consensus Estimate by 0.7%.
Net written premiums increased 4% year over year to a record $11.5 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $10.9 billion.
Travelers witnessed an underwriting profit of $1 billion against a loss of $65 million incurred in the year-ago quarter. The consolidated underlying combined ratio of 84.7 improved 300 bps year over year. The combined ratio improved 990 bps year over year to 90.3 due to lower catastrophe losses, an improvement in the underlying combined ratio and higher net favorable prior year reserve development. The Zacks Consensus Estimate was pegged at 99.
The Progressive Corporation’s (PGR - Free Report) second-quarter 2025 earnings per share of $4.88 beat the Zacks Consensus Estimate by 10.1%. The bottom line increased 84.1% year over year. Net premiums written were $20 billion in the quarter, up 12% from $17.9 billion a year ago.
Net premiums earned grew 18% to $20.3 billion. The reported figure surpassed the Zacks Consensus Estimate of $20.1 billion. Operating revenues increased 19.5% year over year to $42.2 billion, driven by 19% higher net premiums earned, a 29.3% increase in net investment income, an 18.9% rise in fees and a 28% increase in service revenues.
RLI Corp. (RLI - Free Report) reported second-quarter 2025 operating earnings of 84 cents per share, which beat the Zacks Consensus Estimate by 12%. The bottom line, however, decreased 2.3% from the prior-year quarter. Operating revenues for the reported quarter were $441 million, up 6.9% year over year, driven by 6% higher net premiums earned and 16% higher net investment income. The top line, however, missed the Zacks Consensus Estimate by 0.5%.
Underwriting income of $62.2 million decreased 11.14% year over year. The combined ratio deteriorated 300 bps year over year to 84.5. The Zacks Consensus Estimate for the metric was pegged at 88, while our estimate was 42.9.
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Palomar Q2 Earnings, Revenues Top Estimates, Premiums Rise Y/Y
Key Takeaways
Palomar Holdings Inc. (PLMR - Free Report) reported second-quarter 2025 operating income of $1.76 per share, which beat the Zacks Consensus Estimate by 4.7%. The bottom line increased 40.8% year over year.
The quarter’s results benefited from the successful execution of Palomar 2X strategy, improved premiums and net investment income, higher yields on invested assets and solid underwriting income, offset by higher expenses.
Behind the Headlines
Total revenues improved 48.9% year over year to $195 million, mainly attributable to higher premiums and net investment income. The top line beat the Zacks Consensus Estimate by 4.7%.
Palomar Holdings, Inc. Price, Consensus and EPS Surprise
Palomar Holdings, Inc. price-consensus-eps-surprise-chart | Palomar Holdings, Inc. Quote
Gross written premiums increased 28.8% year over year to $496.3 million. Our estimate was $558.2 million.
Net earned premiums increased 47.2% year over year to $164 million. Our estimate was $172.4 million. The Zacks Consensus Estimate was pegged at $160 million.
Net investment income surged 68% year over year to $13.4 million. The increase was primarily driven by higher yields on invested assets and a higher average balance of investments held during the three months ended June 30, 2025 due to cash generated from operations and proceeds from the August 2024 public offering. The Zacks Consensus Estimate was pegged at $11.2 million. Our estimate was $9.6 million.
Palomar Holdings recorded an underwriting income of $38.3 million, up 49.5% year over year. Adjusted underwriting income was nearly $48.4 million, up 47.1% year over year.
Total expenses of $143.3 million increased 46.8% year over year due to higher loss and loss adjustment expenses, acquisition expenses and other underwriting expenses. Our estimate was $136.9 million.
The loss ratio was 25.7, which deteriorated 80 basis points (bps) year over year. Our estimate was 35.5. The Zacks Consensus Estimate was pegged at 26.9.
Adjusted combined ratio, excluding catastrophe losses, was 73.1, which deteriorated 280 bps year over year. The Zacks Consensus Estimate was pegged at 73.
Financial Update
Cash and cash equivalents increased 1.1% from 2024-end to $81.3 million at second-quarter 2025-end.
Shareholder equity increased 16.2% from 2024-end to $847.7 million at the end of the second quarter.
Annualized adjusted return on equity in the second quarter of 2025 was 23.7%, contracting 100 bps year over year.
Capital Deployment
The board of directors approved a $150 million share repurchase program effective July 31, 2025 through July 31, 2027.
2025 View
Palomar Holdings aims to achieve adjusted net income of $198 million to $205 million, up from PLMR’s initial outlook of adjusted net income of $186 million to $200 million. This range includes an estimate of $8 million to $12 million of catastrophe losses for the remainder of the year.
Zacks Rank
PLMR currently has 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
The Travelers Companies (TRV - Free Report) reported second-quarter 2025 core income of $6.51 per share, which beat the Zacks Consensus Estimate by 83.8%. Total revenues increased 6.7% from the year-ago quarter to $12.1 billion, primarily driven by higher premiums, improved net investment income, higher fee income and other revenues. The top-line figure, however, missed the Zacks Consensus Estimate by 0.7%.
Net written premiums increased 4% year over year to a record $11.5 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $10.9 billion.
Travelers witnessed an underwriting profit of $1 billion against a loss of $65 million incurred in the year-ago quarter. The consolidated underlying combined ratio of 84.7 improved 300 bps year over year. The combined ratio improved 990 bps year over year to 90.3 due to lower catastrophe losses, an improvement in the underlying combined ratio and higher net favorable prior year reserve development. The Zacks Consensus Estimate was pegged at 99.
The Progressive Corporation’s (PGR - Free Report) second-quarter 2025 earnings per share of $4.88 beat the Zacks Consensus Estimate by 10.1%. The bottom line increased 84.1% year over year. Net premiums written were $20 billion in the quarter, up 12% from $17.9 billion a year ago.
Net premiums earned grew 18% to $20.3 billion. The reported figure surpassed the Zacks Consensus Estimate of $20.1 billion. Operating revenues increased 19.5% year over year to $42.2 billion, driven by 19% higher net premiums earned, a 29.3% increase in net investment income, an 18.9% rise in fees and a 28% increase in service revenues.
RLI Corp. (RLI - Free Report) reported second-quarter 2025 operating earnings of 84 cents per share, which beat the Zacks Consensus Estimate by 12%. The bottom line, however, decreased 2.3% from the prior-year quarter. Operating revenues for the reported quarter were $441 million, up 6.9% year over year, driven by 6% higher net premiums earned and 16% higher net investment income. The top line, however, missed the Zacks Consensus Estimate by 0.5%.
Underwriting income of $62.2 million decreased 11.14% year over year. The combined ratio deteriorated 300 bps year over year to 84.5. The Zacks Consensus Estimate for the metric was pegged at 88, while our estimate was 42.9.