Bowhead Specialty Holdings Inc. (BOW) AI Stock Analysis

• Market Cap: $805.15M
• Dividend Yield: N/A
• Average Volume (3M): 242.85K
• Price to Earnings (P/E): 15.8
• Beta (1Y): 0.11
• Revenue Growth: 33.17%
• EPS Growth: 70.09%
• Country: US
• Employees: 249
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Property & Casualty
• EPS (TTM): 0.47
• Shares Outstanding: 32,782,974
• 10 Day Avg. Volume: 231,272
• 30 Day Avg. Volume: 242,849
• PEG Ratio: 0.41
• Price to Book (P/B): 2.81
• Price to Sales (P/S): 2.44
• P/FCF Ratio: 3.57
• Enterprise Value/Market Cap: 0.69
• Enterprise Value/Revenue: 1.07
• Enterprise Value/Gross Profit: 3.21
• Enterprise Value/Ebitda: 7.80
• 1Y Price Target: $33.60
• Price Target Upside: 36.81% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 78 Outperform
• Price Target: $28.00 ▲(14.01% Upside)

The score is led by strong financial performance (high-quality cash flows, solid profitability, and conservative capitalization) and supported by a positive earnings update showing continued premium and earnings growth with improving expenses. Offsetting this are only moderate technical strength (still below the 200-day average) and a fair valuation (P/E ~18.3 with no dividend yield provided), while recent debt financing modestly increases leverage despite improving funding flexibility.

Positive Factors

Cash Generation

Consistently strong operating and free cash flow indicates high earnings quality and excellent cash conversion. This durable cash generation supports claim reserve funding, organic growth, reinvestment in technology, and debt servicing capacity through insurance cycles.

Conservative Capitalization

A conservatively capitalized balance sheet with near-zero debt enhances resilience to underwriting volatility and catastrophic losses. It preserves strategic optionality for selective capital deployment, reinsurance purchasing, and measured leverage when attractive growth opportunities arise.

Underwriting Growth & Efficiency

Sustained premium growth alongside improved expense ratio reflects scalable underwriting and operational efficiency. Diversified casualty-led growth and rising investment income create multiple durable earnings drivers, supporting cross-cycle profitability as the business scales.

Negative Factors

Rising Loss Ratio

An uptick in the loss ratio signals increasing claims severity or adverse mix, which can erode underwriting margins over time. If trends persist, the company must raise pricing or tighten selection, both of which can slow growth or compress long-term profitability.

New Debt Obligations

Issuing significant fixed-rate senior notes marks a shift from a near-zero debt profile to meaningful leverage and interest costs. Higher fixed obligations reduce financial flexibility and heighten sensitivity to underwriting and investment returns over the medium term.

Weakness in Professional Liability

Underperformance in professional liability, especially in financial institutions and large cyber accounts, highlights exposure to pockets of soft demand and volatile loss dynamics. Persistent weakness here could limit aggregate premium growth and require capital reallocation.

Bowhead Specialty Holdings Inc. Business Overview & Revenue Model

Company Description

Bowhead 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 Money

Bowhead 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. Financial Statement Overview

Summary

Strong overall fundamentals driven by excellent cash generation (TTM OCF $332.9M; FCF $328.3M; ~0.99x FCF/NI), a conservatively capitalized balance sheet (effectively no debt; rising equity; ROE ~13.1%), and solid profitability (TTM ~13.2% EBIT margin, ~10.1% net margin). Offsetting factors include some gross margin volatility across periods and slightly negative TTM FCF growth (~-1.5%).

Income Statement

TTM (Trailing-Twelve-Months) revenue is $519.2M with strong growth (up ~5.5x versus the prior annual period), and profitability is solid with ~10.1% net margin and ~13.2% EBIT margin. Margins look fairly stable versus 2024 (net margin ~9.0%), showing decent underwriting/expense control as the company scales. The main weakness is gross margin volatility across periods (notably the earlier years showing atypical gross margin readings versus 2024/TTM), which reduces confidence in trend consistency even though operating and net profitability remain healthy.

Balance Sheet

The balance sheet appears very conservatively positioned with effectively no debt (debt-to-equity ~0), supported by growing equity ($430.2M TTM vs $370.4M in 2024) alongside a larger asset base ($2.09B TTM). Returns on equity are healthy (TTM ~13.1%, 2024 ~10.3%), indicating the company is generating good earnings relative to capital. A limitation is that, despite the strong capitalization, the data provided does not detail reserve quality or asset/liability mix—key areas for P&C insurers—so balance-sheet risk cannot be fully assessed from these figures alone.

Cash Flow

Cash generation is a standout: TTM operating cash flow is $332.9M and free cash flow is $328.3M, both very large relative to net income, indicating strong cash conversion. Free cash flow tracks net income closely (TTM ~0.99x), which supports earnings quality. The main drawback is that TTM free cash flow growth is slightly negative (~-1.5%), suggesting cash flow momentum may be flattening after strong prior-year levels.

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

• Technical Analysis Sentiment: Negative
• Last Price: 24.56
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BOW, the sentiment is Negative. The current price of 24.56 is below the 20-day moving average (MA) of 25.24, below the 50-day MA of 26.63, and below the 200-day MA of 30.95, indicating a bearish trend. The MACD of -0.64 indicates Positive momentum. The RSI at 41.04 is Neutral, neither overbought nor oversold. The STOCH value of 32.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BOW.

Bowhead Specialty Holdings Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BOW	78 Outperform	$805.15M	15.77	13.21%	―	33.17%	70.09%
SAFT	75 Outperform	$1.17B	13.37	9.97%	4.59%	13.35%	16.56%
HRTG	72 Outperform	$805.86M	5.41	41.64%	―	5.92%	93.02%
UFCS	71 Outperform	$916.98M	8.48	13.21%	1.73%	12.22%	120.73%
UVE	70 Outperform	$854.09M	7.19	27.34%	2.18%	4.61%	73.40%
DGICA	69 Neutral	$672.45M	7.69	15.10%	3.51%	0.93%	224.95%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Bowhead Specialty Holdings Inc. Corporate Events

Bowhead Specialty Secures $35M Credit Facility Agreement

On November 26, 2025, Bowhead Specialty Holdings Inc. entered into a senior revolving credit agreement with PNC Bank, National Association, providing a $35 million secured revolving credit facility. This facility aims to support the company’s general corporate purposes, including growth funding and capital expenditures, with no borrowings made on the effective date. The agreement includes various financial covenants and restrictions, ensuring the company’s financial discipline and stability while securing its assets.

The most recent analyst rating on (BOW) stock is a Buy with a $33.00 price target. To see the full list of analyst forecasts on Bowhead Specialty Holdings Inc. stock, see the BOW Stock Forecast page.

Bowhead Specialty Completes $150M Senior Notes Offering

On November 25, 2025, Bowhead Specialty Holdings Inc. completed a public offering of $150 million in 7.750% Senior Notes due 2030. The proceeds are intended to support the growth of its insurance subsidiary and other corporate purposes. Concurrently, the company repaid and terminated all obligations under a previous credit agreement, effectively releasing all related security interests and guarantees.

The most recent analyst rating on (BOW) stock is a Buy with a $33.00 price target. To see the full list of analyst forecasts on Bowhead Specialty Holdings Inc. stock, see the BOW Stock Forecast page.

Bowhead Specialty Reports Strong Q3 Financial Results

Bowhead Specialty Holdings Inc. reported strong financial results for the third quarter ended September 30, 2025, with a 17.5% increase in gross written premiums to $231.5 million and an adjusted net income growth of 25.5%. The company’s disciplined underwriting approach and operational excellence contributed to these results, reinforcing its position for enduring success and cross-cycle profitability. The Casualty division led the growth, and the company also saw a 30.9% increase in net investment income, driven by higher investment balances and yields.

The most recent analyst rating on (BOW) stock is a Buy with a $40.00 price target. To see the full list of analyst forecasts on Bowhead Specialty Holdings Inc. stock, see the BOW Stock Forecast page.