William Blair initiated research coverage of Skyward Specialty Insurance Group, Inc. (SKWD $37.21), a specialty insurance company that writes complex risks in underserved commercial markets.
Analyst Adam Klauber estimated that the company would generate operating income per share of $3.03 in 2024, up from $2.04 in 2023, and increasing to a projected $3.45 in 2025 and $3.98 in 2026.
“Skyward is a fast-growing, technology-enabled specialty insurer that focuses on niche markets characterized by complex, hard-to-write risks,” said Klauber. “It uses both third-party and internally developed technology across the value chain to efficiently underwrite risk and consistently monitor the market for opportunities to expand its diverse book of products. We believe Skyward’s top-line growth opportunities are significant, given its diverse book of business, emerging niche positions, and continued E&S market expansion.
“Technology is integrated across the value chain, including policy admission and management, underwriting, and claims administration,” added Klauber. “Skyward’s executive team has a strong technology and analytics background, as well as a high level of experience in the specialty insurance space. The technology advantages allow for effective underwriting of complex risk and drive expense efficiencies. In addition, Skyward focuses on less crowded markets with complex risk characteristics that are typically unattractive to larger insurers. Underwriting these risks requires a high level of expertise, creating barriers to entry. Competition exists from other specialty insurers; however, as the world becomes a riskier place, we believe demand for specialty products is likely to rise and increase the total addressable market available to Skyward.”
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Current Ratings Distribution (as of 8/19/24)
Coverage Universe
Outperform (Buy): 71%
Market Perform (Hold): 29%
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Outperform (Buy): 8%
Market Perform (Hold): 1%
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