Palomar Holdings, Inc. (PLMR): A Bull Case Theory

We came across a bullish thesis on Palomar Holdings, Inc. on Make Money, Make Time’s Substack by Oliver | MMMT Wealth. In this article, we will summarize the bulls’ thesis on PLMR. Palomar Holdings, Inc.'s share was trading at $123.07 as of August 13^th. PLMR’s trailing P/E was 21.66 according to Yahoo Finance.

Palomar Holdings, Inc. (PLMR) is a specialty property and casualty insurer focused on designing and underwriting customized insurance products for underserved and niche markets across the U.S. The company has delivered exceptional growth, with gross written premiums up 28.8% year-over-year, adjusted net income increasing 51.8%, and diluted EPS of $1.68. In Q1 2025, revenue grew over 45% year-over-year, while gross written premiums expanded ~20%, highlighting strong momentum and an expanding total addressable market supported by both product and geographic expansion opportunities.

PLMR’s underwriting performance is a standout feature, with a combined ratio of 73.1% (adjusted 68.5%) and a loss ratio of just 23.6%, significantly outperforming peers such as RLI and Kinsale, while simultaneously achieving faster growth rates. This combination of disciplined underwriting, robust profitability, and rapid expansion positions PLMR as a rare insurer delivering both growth and best-in-class margins. Despite these advantages, PLMR trades at a notable discount to peers, with a forward P/E of 15.9x compared to Kinsale’s 22.1x, leaving substantial room for valuation multiple expansion.

This gap could close as the market better recognizes the company’s superior performance metrics, growth trajectory, and prudent risk management. With a scalable business model, the ability to penetrate additional underserved segments, and sustained profitability well above industry averages, PLMR offers an attractive investment case. The company’s proven execution, financial resilience, and strong competitive positioning provide a favorable risk/reward profile, with potential for both earnings-driven upside and multiple re-rating, making current valuation levels a compelling entry point for long-term investors seeking growth with downside protection.

Previously, we covered a bullish thesis on Skyward Specialty Insurance Group, Inc. (SKWD) by Busy Investor Stock Reports in January 2025, which highlighted the company’s leadership in niche insurance markets, superior underwriting discipline, and industry outperformance. The company’s stock price has appreciated approximately 13.86% since our coverage. Oliver | MMMT Wealth shares a similar view but emphasizes PLMR’s faster growth, superior combined ratio, and valuation discount as key upside drivers.

Palomar Holdings, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 25 hedge fund portfolios held PLMR at the end of the first quarter which was 20 in the previous quarter. While we acknowledge the potential of PLMR as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.