Reviewing Skyward Specialty Insurance Group (NASDAQ:SKWD) & Palomar (NASDAQ:PLMR)

Palomar (NASDAQ:PLMR) and Skyward Specialty Insurance Group (NASDAQ:SKWD) are both mid-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, profitability, earnings, analyst recommendations, institutional ownership and dividends.

Earnings & Valuation

This table compares Palomar and Skyward Specialty Insurance Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Palomar	$553.86 million	6.21	$117.57 million	$4.48	28.77
Skyward Specialty Insurance Group	$1.15 billion	1.82	$85.98 million	$2.89	18.02

Palomar has higher earnings, but lower revenue than Skyward Specialty Insurance Group. Skyward Specialty Insurance Group is trading at a lower price-to-earnings ratio than Palomar, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations for Palomar and Skyward Specialty Insurance Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Palomar	0	3	4	0	2.57
Skyward Specialty Insurance Group	0	4	6	1	2.73

Palomar presently has a consensus target price of $127.33, indicating a potential downside of 1.21%. Skyward Specialty Insurance Group has a consensus target price of $55.00, indicating a potential upside of 5.59%. Given Skyward Specialty Insurance Group’s stronger consensus rating and higher probable upside, analysts plainly believe Skyward Specialty Insurance Group is more favorable than Palomar.

Volatility & Risk

Palomar has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500. Comparatively, Skyward Specialty Insurance Group has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500.

Institutional and Insider Ownership

90.3% of Palomar shares are held by institutional investors. Comparatively, 94.8% of Skyward Specialty Insurance Group shares are held by institutional investors. 4.3% of Palomar shares are held by company insiders. Comparatively, 8.0% of Skyward Specialty Insurance Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Palomar and Skyward Specialty Insurance Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Palomar	21.23%	19.76%	5.78%
Skyward Specialty Insurance Group	12.24%	16.39%	3.57%

Summary

Skyward Specialty Insurance Group beats Palomar on 8 of the 15 factors compared between the two stocks.

About Palomar

Palomar Holdings, Inc., a specialty insurance company, provides property and casualty insurance to residential and businesses in the United States. The company offers personal and commercial specialty property insurance products, including residential and commercial earthquake, fronting, commercial all risk, specialty homeowners, inland marine, Hawaii hurricane, and residential flood, as well as other products, such as assumed reinsurance. It markets and distributes its products through retail agents, wholesale brokers, program administrators, and carrier partnerships. The company was formerly known as GC Palomar Holdings and changed its name to Palomar Holdings, Inc. The company was incorporated in 2013 and is headquartered in La Jolla, California.

About Skyward Specialty Insurance Group

Skyward Specialty Insurance Group, Inc., an insurance holding company, underwrites commercial property and casualty insurance products in the United States. It offers general liability, excess liability, professional liability, commercial auto, group accident and health, property, surety, and workers' compensation insurance products. Skyward Specialty Insurance Group, Inc. was incorporated in 2006 and is headquartered in Houston, Texas.