Arch Capital Group (ACGL) Delivers Record 2025 Operating Income and Robust ROE

Arch Capital Group Ltd. (NASDAQ:ACGL) is one of the dirt cheap stocks to buy now. On February 10, Arch Capital Group announced a strong financial performance for 2025, capped by a Q4 where after-tax operating income rose 26% year-over-year to $1.1 billion. For the full year, the company generated $3.7 billion in operating income, resulting in an impressive 17.1% annualized operating return on average common equity.

The Reinsurance and Mortgage segments were major contributors to the year’s success, with reinsurance delivering a record $1.6 billion in underwriting income and the mortgage segment providing a steady $1 billion. Despite these gains, the company faced some headwinds, including a competitive reinsurance market where property catastrophe rates declined by 10% to 20% during renewals.

Additionally, net premiums written in the insurance segment saw a year-over-year decline due to shifts in business mix and the timing of premium accruals. Arch Capital Group Ltd. (NASDAQ:ACGL) remains focused on disciplined capital allocation, having repurchased $1.9 billion of common stock in 2025, which represents 5.6% of its outstanding shares. For 2026, the company indicated that if growth opportunities remain flat, it may distribute nearly 100% of its generated capital to shareholders.

Arch Capital Group Ltd. (NASDAQ:ACGL), together with its subsidiaries, provides insurance, reinsurance, and mortgage insurance products in the US, Canada, Bermuda, the UK, Europe, and Australia. The company operates through three segments: Insurance, Reinsurance, and Mortgage.

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