Financial Analysis: Accelerant (ARX) versus Its Peers

Accelerant (NYSE:ARX) is one of 316 publicly-traded companies in the “Insurance” industry, but how does it compare to its rivals? We will compare Accelerant to related businesses based on the strength of its risk, dividends, earnings, institutional ownership, profitability, valuation and analyst recommendations.

Analyst Ratings

This is a breakdown of current recommendations for Accelerant and its rivals, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Accelerant	1	7	4	0	2.25
Accelerant Competitors	3236	15332	16140	686	2.40

Accelerant currently has a consensus price target of $18.95, suggesting a potential downside of 4.07%. As a group, “Insurance” companies have a potential upside of 6.98%. Given Accelerant’s rivals stronger consensus rating and higher probable upside, analysts plainly believe Accelerant has less favorable growth aspects than its rivals.

Insider & Institutional Ownership

55.8% of shares of all “Insurance” companies are owned by institutional investors. 66.6% of Accelerant shares are owned by insiders. Comparatively, 13.8% of shares of all “Insurance” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk and Volatility

Accelerant has a beta of 0.08, suggesting that its share price is 92% less volatile than the S&P 500. Comparatively, Accelerant’s rivals have a beta of 0.61, suggesting that their average share price is 39% less volatile than the S&P 500.

Earnings & Valuation

This table compares Accelerant and its rivals top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Accelerant	$912.90 million	-$1.35 billion	-2.97
Accelerant Competitors	$15.72 billion	$1.69 billion	34.02

Accelerant’s rivals have higher revenue and earnings than Accelerant. Accelerant is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Accelerant and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Accelerant	-113.08%	42.79%	3.68%
Accelerant Competitors	10.29%	11.05%	4.11%

Summary

Accelerant rivals beat Accelerant on 11 of the 13 factors compared.

About Accelerant

Accelerant Holdings, together with its subsidiaries, operates a data-driven risk exchange that connects selected specialty insurance underwriters with risk capital partners. It operates through Exchange Services, MGA Operations, and Underwriting segments. The Exchange Services segment consists of risk exchange, its operating platform that incorporates various technology, data ingestion, and agency operations that serve the needs of its members and risk capital partners. Its Risk capital partners write premiums directly through the Risk Exchange pay us a fixed-percentage, volume-based fee for sourcing, managing, and monitoring the business they write. The MGA Operations segment includes the fees earned by members, predominantly for originating and underwriting a portfolio of insurance policies, reduced by the expenses associated with providing services. The Underwriting segment is involved in underwriting insurance policies and assumption of reinsurance policies issued or accepted by consolidated insurance and reinsurance companies. The activities of insurance companies include property and casualty insurance, policy issuance, and reinsurance arrangements. It serves small-to-medium sized commercial clients primarily in the United States, Europe, Canada, Australia, and the United Kingdom. Accelerant Holdings was founded in 2018 and is based in Grand Cayman, Cayman Islands.