1Q26 Earnings: Continues Shift Away From Earthquake Towards Crop and Casualty

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1Q26 Earnings: Continues Shift Away From Earthquake Towards Crop and Casualty

C O M PA N Y N O T E

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Palomar Holdings, Inc. (PLMR) Overweight

CONCLUSION PRICE: US$113.36

Reported EPS $2.31 | Consensus $2.22 | PSC $2.17 A beat versus PSC and consensus. TARGET: US$132.00

The higher-than-expected top-line growth in premiums drove most of the beat – specifically Our $132 target is based on 12.0x our 27E EPS

from a 55.0% growth in Casualty. PLMR remains one of the fastest growing companies of $11.00.

with one of the highest ROEs among the companies we follow.

Paul Newsome, CFA, CPCU

Managing Director, Piper Sandler & Co.

• We remain Overweight on PLMR: Palomar is executing on its "Palomar 2X" plan, a 312 281-3445, paul.newsome@psc.com

goal to double adjusted net income, capital, and premiums over three to five years while Cam Bianchi

maintaining a 20%+ adjusted ROE. The one of its core competitive advantage lies in Research Analyst, Piper Sandler & Co.

its balance sheet/reinsurance structure, where it actively shifts reinsurance retentions 612 456-9841, cam.bianchi@psc.com

across its business lines, functioning as an MGA in some segments and an insurer Changes Previous Current

in others, to maximize risk-adjusted returns regardless of the pricing environment. Rating — Overweight

This flexibility is evident in earthquake, where margin expansion is expected even Price Tgt US$151.00 US$132.00

as rates soften, because reinsurance costs are declining faster than gross rates. FY26E EPS US$9.60 US$9.70

The diversification of the book across earthquake (admitted and E&S residential and FY27E EPS — US$11.00

commercial), inland marine, casualty, crop, and surety provides multiple growth options Market Cap. (mil) US$3,094.7