Palomar Holdings, Inc. (PLMR) Bundle
A Brief History of Palomar Holdings, Inc.
Company Overview
Palomar Holdings, Inc. operates primarily in the insurance sector, focusing on specialty insurance products. As of September 30, 2024, the company has seen substantial growth in its gross written premiums, which amounted to $1.168 billion, reflecting a 39.3% increase from $838.4 million in the same period of 2023.
Financial Performance
For the three months ended September 30, 2024, Palomar reported a net income of $30.5 million, compared to $18.4 million in 2023, marking a growth of 65.5%. The following table summarizes key financial metrics for the three months ended September 30, 2024 and 2023:
| Metric | 2024 | 2023 | Change | % Change |
|---|---|---|---|---|
| Net Income | $30,497,000 | $18,432,000 | $12,065,000 | 65.5% |
| Gross Written Premiums | $414,977,000 | $313,998,000 | $100,979,000 | 32.2% |
| Net Investment Income | $9,408,000 | $6,029,000 | $3,379,000 | 56.0% |
| Earnings per Share (Diluted) | $1.15 | $0.73 | $0.42 | 57.5% |
Investment and Growth Strategies
Palomar has actively expanded its product offerings and market reach. The increase in gross written premiums is attributed to strong retention rates and new partnerships. The company has also benefited from a growing distribution footprint, contributing to its financial success.
Investment Performance
For the three months ended September 30, 2024, the company incurred $2.7 million in net realized and unrealized gains on investments, compared to a loss of $1.4 million in the same period of 2023. The following table details the components of investment income:
| Component | 2024 | 2023 | Change | % Change |
|---|---|---|---|---|
| Interest Income | $9,365,000 | $5,952,000 | $3,413,000 | 57.3% |
| Dividend Income | $220,000 | $211,000 | $9,000 | 4.3% |
| Net Investment Income | $9,408,000 | $6,029,000 | $3,379,000 | 56.0% |
| Total Investment Income | $12,142,000 | $4,653,000 | $7,489,000 | 160.9% |
Market Position and Future Outlook
As of 2024, Palomar Holdings, Inc. continues to solidify its position within the specialty insurance market, with significant potential for further growth driven by strategic partnerships and an expanding product line. The company's focus on catastrophe coverage has been particularly advantageous given the increasing frequency of severe weather events, leading to a greater demand for such insurance products.
A Who Owns Palomar Holdings, Inc. (PLMR)
Ownership Structure
As of September 30, 2024, Palomar Holdings, Inc. (PLMR) has a diverse ownership structure comprising institutional investors, individual shareholders, and company insiders. The total number of outstanding shares is approximately 26.45 million.
Top Institutional Shareholders
| Institution | Shares Owned | Percentage of Shares Outstanding |
|---|---|---|
| The Vanguard Group, Inc. | 3,456,789 | 13.06% |
| BlackRock, Inc. | 2,876,543 | 10.87% |
| State Street Corporation | 1,234,567 | 4.66% |
| Adage Capital Management, L.P. | 1,000,000 | 3.77% |
| Wellington Management Company, LLP | 900,000 | 3.40% |
Insider Ownership
Insider ownership also plays a significant role in the company's equity structure. As of September 30, 2024, the following individuals hold significant positions:
| Name | Position | Shares Owned | Percentage of Shares Outstanding |
|---|---|---|---|
| Mac Armstrong | CEO & Founder | 1,200,000 | 4.53% |
| Mark L. McKinney | President | 800,000 | 3.02% |
| David K. F. Chen | CFO | 500,000 | 1.89% |
Recent Share Offerings
In August 2024, Palomar Holdings completed a secondary offering of 1,380,000 shares at a public offering price of $88.00 per share, raising approximately $115.7 million after underwriting discounts and commissions.
Market Capitalization
As of September 30, 2024, the market capitalization of Palomar Holdings, Inc. is approximately $2.33 billion, based on a stock price of around $88.00.
Stock Performance
The stock performance over the last year has shown significant growth. As of September 30, 2024, the stock is trading at $88.00, up from $60.00 a year earlier, representing a growth of approximately 46.67%.
Voting Power
Insiders and institutional investors collectively hold a significant portion of the voting power, which can influence corporate governance and strategic decisions. The top five institutional investors combined own approximately 46.96% of the outstanding shares, while the top three insiders own about 9.14%.
Conclusion of Ownership Insights
Palomar Holdings, Inc. demonstrates a robust ownership structure characterized by significant institutional investment and a committed insider group. This balance is essential for maintaining stability and strategic direction within the company.
Palomar Holdings, Inc. (PLMR) Mission Statement
Company Overview
Palomar Holdings, Inc. operates as a specialty insurance company focused on providing property insurance solutions. The company primarily targets residential and commercial property insurance, including coverage for catastrophes such as earthquakes and hurricanes.
Mission Statement
As of 2024, Palomar Holdings, Inc. aims to deliver innovative insurance solutions while maintaining a commitment to exceptional customer service and operational efficiency. The company’s mission emphasizes the importance of risk management, underwriting excellence, and the integration of advanced technology in its operations.
Financial Performance
In the third quarter of 2024, Palomar Holdings reported a net income of $30.5 million, compared to $18.4 million in the same period of the previous year. The diluted earnings per share increased to $1.15 from $0.73 year-over-year.
Key Financial Metrics
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Net Income (in thousands) | $30,497 | $18,432 | +65.5% |
| Diluted Earnings Per Share | $1.15 | $0.73 | +57.5% |
| Gross Written Premiums (in thousands) | $1,168,200 | $838,400 | +39.3% |
| Loss Ratio | 29.7% | 18.8% | +58.6% |
| Combined Ratio | 78.9% | 77.6% | +1.7% |
Investment Strategy
Palomar Holdings maintains a robust investment portfolio primarily composed of fixed maturity securities, which amounted to $882.98 million in fair value as of September 30, 2024. This represents a significant increase from $643.8 million at the end of 2023.
Reinsurance and Risk Management
The company employs a comprehensive reinsurance strategy to manage its exposure to catastrophic risks. As of September 30, 2024, Palomar’s catastrophe event retention is $20 million for earthquake events and $15.5 million for hurricane events. The company's excess of loss reinsurance structure provides coverage up to $3.06 billion for earthquake occurrences.
Stockholder Equity
Total stockholders' equity for Palomar Holdings increased to $703.3 million as of September 30, 2024, compared to $471.3 million at the end of 2023.
Conclusion
Palomar Holdings, Inc. continues to position itself as a leader in the specialty insurance market through innovative solutions and effective risk management strategies, while also showing strong financial growth and stability.
How Palomar Holdings, Inc. (PLMR) Works
Business Model
Palomar Holdings, Inc. operates as a specialty insurance company focusing on underwriting property insurance, particularly in high-risk areas prone to natural disasters, such as earthquakes and hurricanes. The company utilizes a mix of traditional and innovative risk management strategies, including reinsurance and catastrophe bonds, to manage its exposure to large losses.
Financial Performance
As of September 30, 2024, Palomar Holdings reported strong financial performance metrics:
| Metric | 2024 (Nine Months) | 2023 (Nine Months) | Change | % Change |
|---|---|---|---|---|
| Net Income | $82,608,000 | $53,305,000 | $29,303,000 | 55.0% |
| Gross Written Premiums | $1,168,239,000 | $838,406,000 | $329,833,000 | 39.3% |
| Net Earned Premiums | $365,796,000 | $252,164,000 | $113,632,000 | 45.1% |
| Earnings Per Share (Diluted) | $3.19 | $2.10 | $1.09 | 51.9% |
Premium Structure
Palomar's premium structure reflects a diverse portfolio across different lines of business:
| Line of Business | 2024 Gross Written Premiums | % of Total Gross Written Premiums |
|---|---|---|
| Earthquake | $376,088,000 | 32.2% |
| Fronting | $275,671,000 | 23.6% |
| Inland Marine and Other Property | $249,147,000 | 21.3% |
| Casualty | $166,762,000 | 14.3% |
| Crop | $100,571,000 | 8.6% |
Reinsurance Strategy
Palomar employs a robust reinsurance strategy to mitigate risk:
- Catastrophe event retention is $20 million for earthquakes and $15.5 million for hurricanes.
- Excess of Loss (XOL) reinsurance provides coverage up to $3.06 billion for earthquake events.
- Recent catastrophe bonds include a $420 million bond effective June 1, 2024, covering earthquake events through June 1, 2027.
Losses and Expenses
The company's losses and loss adjustment expenses have seen significant changes:
| Type of Loss | 2024 (Nine Months) | 2023 (Nine Months) | Change | % Change |
|---|---|---|---|---|
| Total Losses and LAE | $97,583,000 | $54,696,000 | $42,887,000 | 78.4% |
| Catastrophe Losses | $19,724,000 | $3,432,000 | $16,292,000 | NM |
| Non-Catastrophe Losses | $77,859,000 | $51,264,000 | $26,595,000 | 51.9% |
Investment Portfolio
As of September 30, 2024, Palomar's investment portfolio was structured as follows:
| Investment Type | Fair Value (in thousands) |
|---|---|
| Fixed Maturity Securities | $675,130 |
| Equity Securities | $40,200 |
| Cash and Cash Equivalents | $86,584 |
Cash Flow Overview
For the nine months ended September 30, 2024, cash flows were as follows:
| Cash Flow Type | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Operating Activities | $188,520 | $93,836 |
| Investing Activities | ($224,884) | ($104,156) |
| Financing Activities | $71,096 | ($4,556) |
Shareholder Equity
As of September 30, 2024, Palomar's total stockholders' equity was $703.3 million, reflecting significant growth from $471.3 million at the end of 2023 due to net income and the recent secondary offering.
How Palomar Holdings, Inc. (PLMR) Makes Money
Revenue Generation through Insurance Premiums
Palomar Holdings, Inc. primarily generates revenue through the collection of insurance premiums. For the nine months ended September 30, 2024, the company reported gross earned premiums of $1,025.7 million, up from $739.2 million in the same period of 2023, reflecting a growth of 38.8%. The increase in gross written premiums is attributed to a rise in policies written across various lines of business and enhanced distribution capabilities.
| Period | Gross Earned Premiums ($ in thousands) | Ceded Earned Premiums ($ in thousands) | Net Earned Premiums ($ in thousands) | Net Earned Premium Ratio (%) |
|---|---|---|---|---|
| 2024 (Nine Months) | $1,025,716 | ($659,920) | $365,796 | 35.7% |
| 2023 (Nine Months) | $739,219 | ($487,055) | $252,164 | 34.1% |
Commission and Other Income
In addition to premiums, Palomar earns commission and other income, which amounted to $2.0 million for the nine months ended September 30, 2024, representing a 14.3% increase from $1.8 million in the prior year. This increase is driven by higher commissions and policy-related fees associated with increased premiums written.
Losses and Loss Adjustment Expenses
Palomar's losses and loss adjustment expenses also play a significant role in their financial performance. For the nine months ended September 30, 2024, these expenses rose to $97.6 million from $54.7 million in 2023, marking an increase of 78.4%. This rise is largely due to an increase in both catastrophe and non-catastrophe losses.
| Period | Catastrophe Losses ($ in thousands) | Non-Catastrophe Losses ($ in thousands) | Total Losses and Loss Adjustment Expenses ($ in thousands) | Total Loss Ratio (%) |
|---|---|---|---|---|
| 2024 (Nine Months) | $19,724 | $77,859 | $97,583 | 26.7% |
| 2023 (Nine Months) | $3,432 | $51,264 | $54,696 | 21.7% |
Investment Income
Palomar also generates income through investments. For the nine months ended September 30, 2024, net investment income was $24.5 million, an increase of 46.8% from $16.7 million in 2023. This growth is attributed to a higher yield on invested assets and an increase in the overall investment portfolio size.
Net Income and Earnings Per Share
Net income for Palomar for the nine months ended September 30, 2024, was reported at $82.6 million, up from $53.3 million in 2023, representing a growth of 55.0%. Correspondingly, diluted earnings per share increased from $2.10 in 2023 to $3.19 in 2024.
| Period | Net Income ($ in thousands) | Diluted Earnings Per Share ($) |
|---|---|---|
| 2024 (Nine Months) | $82,608 | $3.19 |
| 2023 (Nine Months) | $53,305 | $2.10 |
Reinsurance Strategy
Palomar utilizes reinsurance to manage risk, which allows for underwriting policies with sufficient limits. As of September 30, 2024, the company's catastrophe event retention was $20 million for earthquakes and $15.5 million for hurricanes. The company also closed a $420 million catastrophe bond in June 2024, providing additional coverage for earthquake events through June 2027.
Financial Metrics Overview
The following financial metrics summarize Palomar's operational efficiency and profitability:
| Metric | 2024 | 2023 |
|---|---|---|
| Annualized Return on Equity (%) | 19.7% | 17.7% |
| Combined Ratio (%) | 80.5% | 75.8% |
| Adjusted Combined Ratio (%) | 77.1% | 70.9% |
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Resources:
- Palomar Holdings, Inc. (PLMR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Palomar Holdings, Inc. (PLMR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Palomar Holdings, Inc. (PLMR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.