GET DAILY SIGNALSPalomar Holdings (PLMR) Delivers +27% Net Income Growth in Q3 2026
Key Takeaways
- Palomar Holdings (PLMR) reported third-quarter 2026 net income of $65.3 million, or $2.42 per diluted share under GAAP, up 27% and 29% year over year, respectively.
- Adjusted net income climbed 47% to $81.3 million, or $3.01 per diluted share, topping consensus estimates of about $2.59 by roughly 16%.
- Total revenue grew 58% year over year to $386.6 million, exceeding Wall Street's consensus of approximately $356.7 million.
- Gross written premiums rose 28.4% to a record $767.0 million, with growth across all five of the company's product categories.
- The combined ratio was 80.8%, better than the roughly 82.3% consensus, even as catastrophe and crop-related losses pushed the loss ratio higher.
Why These Results Matter
Palomar Holdings is a specialty property and casualty insurer focused on residential and commercial earthquake coverage, along with expanding lines in crop, casualty, inland marine, and surety. The third-quarter report for the period ended September 30, 2026, provides a useful test of whether rapid premium growth can translate into solid underwriting profits. Key metrics such as gross written premiums, the loss ratio, and the combined ratio (where anything below 100% indicates an underwriting profit) offer clear signals for investors. After a series of earnings beats, this update also sheds light on how the company's diversification efforts are performing amid rate pressure in commercial earthquake and softer conditions in some commercial property segments.
Detailed Results Breakdown
In the third quarter of 2026, Palomar reported net income of $65.3 million, or $2.42 per diluted share, compared with $51.5 million, or $1.87 per share, in the prior-year period. Adjusted net income, which strips out items such as investment gains and losses, transaction expenses, stock-based compensation, and intangible amortization, rose 47% to $81.3 million, or $3.01 per diluted share. That figure comfortably beat the consensus estimate of roughly $2.59 per share. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Total revenue increased 58% year over year to $386.6 million, ahead of the approximately $356.7 million consensus. Net earned premiums climbed 62.3% to $365.4 million, while net investment income grew 53.8% to $22.4 million. Gross written premiums hit a record $767.0 million, up 28.4%, driven by an 89.3% surge in crop premiums and a 228.4% jump in surety and credit lines. The loss ratio rose to 41.5% from 32.3%, and the combined ratio increased to 80.8% from 78.1%, though both came in better than expected.
Market Reaction
Shares of PLMR rose about 2.1% to $146.78 right after the release, reflecting a positive response to the company's 16th consecutive earnings beat. Investors appeared to balance the strength of the top-line results and record premium production against a higher loss ratio influenced by hurricane and flood events in Hawaii and Midwest flooding, plus roughly $4.0 million of unfavorable prior-year development tied to crop losses. The fourth increase to full-year 2026 adjusted net income guidance also helped support sentiment, indicating management sees continued momentum despite a more active catastrophe environment and softer commercial earthquake pricing.
Forward Outlook
Looking ahead, the focus will be on whether Palomar can maintain premium momentum while preserving underwriting profitability. Crop and surety lines have become key growth drivers, and their performance through the seasonally weighted fourth and first quarters will be worth monitoring. Management's repeated guidance increases point to confidence in full-year adjusted net income, though the underlying details will be important.
Catastrophe activity remains another area to watch. The quarter's elevated loss ratio partly reflected weather-related events, and a prolonged stretch of storms or flooding could pressure results even with the benefit of a diversified product portfolio. Rate conditions in commercial earthquake continue to present a headwind, while a softer property catastrophe reinsurance market could open opportunities to grow premium volume in 2026 and beyond.
Finally, the combined ratio and net earned premium ratio can shift with reinsurance renewal timing and crop seasonality. Palomar's ability to keep the combined ratio comfortably below 100% while expanding into newer lines such as flood and healthcare liability will remain central to the investment case in coming quarters.
AI Tools in My Research Process
When analyzing names like PLMR, I often turn to Tickeron's AI Screener to quickly filter for comparable companies based on technical patterns, fundamentals, and AI-driven signals. It helps surface relevant ideas without manual effort and has become a regular part of my workflow for sector comparisons and opportunity spotting.
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
PLMR's MACD Histogram just turned positive
The Moving Average Convergence Divergence (MACD) for PLMR turned positive on October 30, 2026. Looking at past instances where PLMR's MACD turned positive, the stock continued to rise in 47 of 56 cases over the following month. The odds of a continued upward trend are 84%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 30, 2026. You may want to consider a long position or call options on PLMR as a result. In 67 of 82 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 82%.
PLMR moved above its 50-day moving average on October 12, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for PLMR crossed bullishly above the 50-day moving average on October 15, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 14 of 18 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 78%.
Following a +5.72% 3-day Advance, the price is estimated to grow further. Considering data from situations where PLMR advanced for three days, in 249 of 326 cases, the price rose further within the following month. The odds of a continued upward trend are 76%.
The Aroon Indicator entered an Uptrend today. In 169 of 215 cases where PLMR Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 79%.
Bearish Trend Analysis
The 10-day RSI Indicator for PLMR moved out of overbought territory on October 23, 2026. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 31 similar instances where the indicator moved out of overbought territory. In 24 of the 31 cases, the stock moved lower in the following days. This puts the odds of a move lower at 77%.
The Stochastic Oscillator entered the overbought zone. Expect a price pull-back in the foreseeable future.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where PLMR declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 74%.
PLMR broke above its upper Bollinger Band on October 14, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Fundamental Analysis (Ratings)
The Tickeron Price Growth Rating for this company is 39 (best 1 - 100 worst), indicating steady price growth. PLMR’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is 45 (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 50 (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 51, placing this stock slightly better than average.
The Tickeron PE Growth Rating for this company is 58 (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of 81 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (3.864) is normal, around the industry mean (-2.452). P/E Ratio (18.804) is within average values for comparable stocks, (9.201). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (3.303). Dividend Yield (0.012) settles around the average of (0.026) among similar stocks. PLMR's P/S Ratio (3.515) is very high in comparison to the industry average of (1.594).
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Fundamental Analysis Ratings
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General Information
a provider of property insurance services
Industry PropertyCasualtyInsurance
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