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Bowhead Specialty Holdings Inc. (BOW)
NYSE:BOW
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Bowhead Specialty Holdings Inc.
(NYSE:BOW)
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Select Model
Rating:70Outperform
Price Target:―
Bowhead Specialty Holdings Inc. scores highly due to its robust financial performance and strategic initiatives in the E&S market. However, technical indicators and a high P/E ratio suggest caution. The stock's strong momentum and corporate strategy add positively to the outlook, though valuation concerns limit the overall score.
Positive Factors
Revenue Growth
The strong revenue growth indicates Bowhead's successful market expansion and product adoption, positioning the company for sustained long-term growth.
Cash Generation
Robust cash generation supports Bowhead's operational needs and future investments, highlighting effective capital management and financial stability.
Market Position
Bowhead's strategic focus on the E&S market and strong underwriting culture enhance its competitive position, driving future growth and profitability.
Negative Factors
Low Equity Ratio
While improved, the low equity ratio may limit Bowhead's ability to leverage equity for growth, posing a potential risk to financial flexibility.
Absence of EBITDA Data
Lack of EBITDA data hinders a complete evaluation of operational cash efficiency, potentially obscuring insights into Bowhead's profitability.
Equity Utilization Risk
Despite improved ROE, reliance on equity for profit generation may pose risks if market conditions change, affecting long-term sustainability.
Bowhead Specialty Holdings Inc. (BOW) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$834.29M
Dividend YieldN/A
Average Volume (3M)350.82K
Price to Earnings (P/E)16.3
Beta (1Y)0.18
Revenue Growth33.17%
EPS Growth70.09%
CountryUS
Employees249
SectorFinancial
Sector Strength70
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)0.47
Shares Outstanding32,781,567
10 Day Avg. Volume336,855
30 Day Avg. Volume350,823
Financial Highlights & Ratios
PEG Ratio0.41
Price to Book (P/B)2.81
Price to Sales (P/S)2.44
P/FCF Ratio3.57
Enterprise Value/Market Cap1.53
Enterprise Value/Revenue2.46
Enterprise Value/Gross Profit7.39
Enterprise Value/Ebitda17.98
Forecast
1Y Price Target
$34.60Price Target Upside24.95% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Bowhead Specialty Holdings Inc. Business Overview & Revenue Model
Company DescriptionBowhead Specialty Holdings Inc. provides specialty property and casualty insurance products in the United States. It underwrites casualty insurance solutions for risks in the construction, distribution, heavy manufacturing, real estate, and hospitality segments; professional liability insurance solutions for financial institutions, private and public directors and officers liability insurance, errors and omissions liability insurance, and cyber segments; and healthcare solutions for hospitals, senior care providers, managed care organizations, miscellaneous medical facilities, and healthcare management liability segments. The company distributes its products through distribution partners in wholesale and retail markets. Bowhead Specialty Holdings Inc. was formerly known as Bowhead Holdings Inc. and changed its name to Bowhead Specialty Holdings Inc. in March 2024. The company was founded in 2020 and is based in New York, New York. Bowhead Specialty Holdings Inc. operates as a subsidiary of Bowhead Insurance Holdings LP.
How the Company Makes MoneyBowhead Specialty Holdings Inc. generates revenue primarily through underwriting insurance policies and collecting premiums from its clients. The company leverages its expertise in risk assessment and management to provide customized insurance products, thereby attracting clients in specialized sectors. Revenue streams include premiums from property and casualty insurance products, underwriting fees, and investment income derived from the reserves held against future policyholder claims. Strategic partnerships with brokers and agents also play a crucial role in expanding its market reach and driving sales growth.
Bowhead Specialty Holdings Inc. Earnings Call Summary
Earnings Call Date:Nov 04, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Mar 03, 2026
Earnings Call Sentiment Positive
Bowhead Specialty's Q3 2025 earnings call presented a strong performance with notable increases in gross written premiums, adjusted net income, and investment income. However, challenges in specific divisions and a rise in the loss ratio were highlighted. The company's technological advancements and operational efficiencies contributed positively to its expense ratio.Q3-2025 Updates
Positive Updates
Strong Growth in Gross Written Premiums
Bowhead reported a 17.5% year-over-year increase in gross written premiums, amounting to approximately $232 million for the third quarter.
Significant Increase in Adjusted Net Income
Adjusted net income rose by 25.5%, reflecting the company's effective management strategies and operational efficiencies.
Improved Expense Ratio
The company achieved an expense ratio of 29.5%, a decrease of 40 basis points year-over-year, driven by technology and operational efficiencies.
Baleen's Impressive Growth
Baleen generated $6.2 million in premium during the quarter, marking an 83% growth from Q2 and exceeding the total premiums written in the first half of 2025.
Increase in Net Investment Income
Net investment income increased by 31% year-over-year to $15 million, reflecting a higher balance of investments and higher yields.
Negative Updates
Challenges in Professional Liability Division
Premiums in the professional liability division only increased by 2%, with challenges in the financial institutions and large cyber liability account space.
Increase in Loss Ratio
The loss ratio for the quarter increased by 1.4 points to 65.9%, influenced by the product mix and reliance on industry loss data.
Deceleration in Construction Projects
A slowdown in new large residential construction projects due to uncertainty around interest rates and material costs was noted.
Company Guidance
During Bowhead Specialty's Q3 2025 earnings call, the company reported significant financial growth with gross written premiums rising by 17.5% year-over-year to approximately $232 million. The Casualty division was highlighted as a key driver, particularly the excess casualty business, which grew 20% to $145 million. Adjusted net income increased by 25.5%, while diluted adjusted earnings per share rose by 23.7% to $0.47. The company achieved an expense ratio of 29.5%, a decrease of 40 basis points from the previous year, reflecting efficiencies from technology initiatives. The Healthcare Liability division saw a premium increase of 11% to $35 million, and the Professional Liability division grew by 2% to $46 million. A notable highlight was Baleen, which generated $6.2 million in premium during the quarter, marking an 83% growth from Q2. The company maintained a disciplined approach to underwriting, with a combined ratio of 95.4% for the quarter. Additionally, net investment income increased by 31% to $15 million, with a book yield of 4.8%. Bowhead plans to seek additional capital to support growth through means other than equity markets, leveraging debt capacity.Bowhead Specialty Holdings Inc. Financial Statement Overview
Summary
Bowhead Specialty Holdings Inc. demonstrates strong financial performance with significant revenue and profit growth, efficient cash management, and no debt. Despite a low equity ratio, the company is well-positioned for sustainable growth.Income Statement
Bowhead Specialty Holdings Inc. demonstrates a robust financial performance with a consistent increase in total revenue, achieving a significant growth rate of 50.2% from 2023 to 2024. The gross profit margin remains strong at 100% due to revenue equating to gross profit, indicating effective cost management. Net profit margin improved from 8.8% in 2023 to 9.0% in 2024, driven by an increase in net income. EBIT margin also improved remarkably from 12.1% in 2023 to 79.0% in 2024, showcasing enhanced operational efficiency. However, the absence of EBITDA data for 2024 limits a full assessment of operational cash efficiency.88
Very Positive
Balance Sheet
The balance sheet of Bowhead Specialty Holdings Inc. indicates a stable financial position with no debt, resulting in a favorable debt-to-equity ratio of 0. The company's equity ratio improved to 22.4% in 2024, reflecting a solid equity base relative to total assets. The return on equity (ROE) increased to 10.3% in 2024, highlighting effective utilization of shareholder equity to generate profit. However, the relatively low equity ratio suggests a potential risk in leveraging further growth through equity.75
Positive
Cash Flow
The cash flow statement shows strong cash generation capabilities with a 25.3% growth in free cash flow from 2023 to 2024, indicating effective capital management. The operating cash flow to net income ratio stands at a healthy 7.7, suggesting efficient conversion of income into cash. Additionally, a substantial free cash flow to net income ratio of 7.6 demonstrates strong cash profitability. Continued positive cash flow growth supports business operations and future investments.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 |
|---|---|---|---|---|
Income Statement | ||||
| Total Revenue | 519.17M | 425.59M | 283.42M | 187.60M |
| Gross Profit | 172.83M | 145.10M | 96.20M | 60.65M |
| EBITDA | 71.08M | 55.13M | 34.38M | 15.39M |
| Net Income | 52.55M | 38.24M | 25.05M | 11.26M |
Balance Sheet | ||||
| Total Assets | 2.09B | 1.65B | 1.03B | 565.21M |
| Cash, Cash Equivalents and Short-Term Investments | 1.40B | 987.46M | 118.07M | 347.58M |
| Total Debt | 0.00 | 0.00 | 0.00 | 0.00 |
| Total Liabilities | 1.66B | 1.28B | 835.78M | 481.83M |
| Stockholders Equity | 430.23M | 370.44M | 192.08M | 83.37M |
Cash Flow | ||||
| Free Cash Flow | 328.30M | 291.18M | 232.41M | 177.67M |
| Operating Cash Flow | 332.86M | 294.29M | 236.22M | 181.64M |
| Investing Cash Flow | -243.86M | -325.88M | -274.76M | -187.46M |
| Financing Cash Flow | 64.00K | 133.89M | 77.66M | -1.00M |
Bowhead Specialty Holdings Inc. Technical Analysis
Neutral
27.69
Price Trends
26.37
Positive
29.50
Negative
33.22
Negative
Market Momentum
0.30
Negative
62.79
Neutral
94.86
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BOW, the sentiment is Neutral. The current price of 27.69 is above the 20-day moving average (MA) of 25.50, above the 50-day MA of 26.37, and below the 200-day MA of 33.22, indicating a neutral trend. The MACD of 0.30 indicates Negative momentum. The RSI at 62.79 is Neutral, neither overbought nor oversold. The STOCH value of 94.86 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for BOW.
Bowhead Specialty Holdings Inc. Risk Analysis
Bowhead Specialty Holdings Inc. disclosed 57 risk factors in its most recent earnings report. Bowhead Specialty Holdings Inc. reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Bowhead Specialty Holdings Inc. Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $946.84M | 8.75 | 13.21% | 1.75% | 12.22% | 120.73% | |
75 Outperform | $1.15B | 13.12 | 9.97% | 5.31% | 13.35% | 16.56% | |
75 Outperform | $962.58M | 6.46 | 41.64% | ― | 5.92% | 93.02% | |
74 Outperform | $964.88M | 8.12 | 27.34% | 2.29% | 4.61% | 73.40% | |
70 Outperform | $834.29M | 16.34 | 13.23% | ― | 33.17% | 70.09% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
62 Neutral | $710.52M | 8.23 | 15.10% | 3.64% | 0.93% | 224.95% |
* Financial Sector Average
BOW
Bowhead Specialty Holdings Inc.
27.69
-6.03
-17.88%
DGICA
Donegal Group
19.78
4.74
31.52%
SAFT
Safety Insurance Group
76.12
-4.90
-6.05%
UFCS
United Fire Group
36.60
9.76
36.36%
UVE
Universal Insurance Holdings
34.17
12.50
57.68%
HRTG
Heritage Insurance Holdings
30.18
18.00
147.78%
Bowhead Specialty Holdings Inc. Corporate Events
Business Operations and StrategyFinancial Disclosures
Bowhead Specialty Highlights Profitable Growth in E&S Market
Positive
Feb 28, 2025
On February 28, 2025, Bowhead Specialty Holdings Inc. released an investor presentation for the period ending December 31, 2024. The presentation highlights the company’s focus on profitable growth in the E&S market, emphasizing its strong underwriting culture and experienced management team. The company reported a combined ratio for 2024, reflecting changes in its portfolio mix, particularly in casualty lines. This strategic focus positions Bowhead for continued growth and strong returns, benefiting stakeholders and reinforcing its market position.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.