A month has gone by since the last earnings report for Skyward Specialty Insurance (SKWD). Shares have lost about 10.7% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Skyward due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Skyward Specialty Insurance Group, Inc. before we dive into how investors and analysts have reacted as of late.
SKWD Q2 Earnings Beat Estimates as Premium Growth Accelerates
Skyward Specialty delivered a solid second quarter of 2026, with operating earnings per share of $1.30, which increased 46.1% from the year-ago level. It beat the Zacks Consensus Estimate by 13%.
Total revenues were $489.53 million, which improved 53% year over year and beat the consensus mark by 6.5%.
The second-quarter performance reflected strong premium growth and contributions from the Apollo segment, while underwriting remained profitable despite a slight increase in the combined ratio.
SKWD's Premium Base Expanded Across Both Platforms
Gross written premiums totaled $740.6 million, up 13.3% from the prior-year period's level. Growth was broad-based, led by a 14.2% increase in the Skyward Specialty segment and a 5.6% rise in the Apollo segment, with Syndicate 1969's gross written premiums increasing 7.7%.
Net earned premiums climbed to $444.5 million from $295.5 million a year ago, reflecting higher business volumes and contributions from the Apollo segment. Underwriting fee income of $12.6 million, generated by the Apollo segment, also contributed to the quarter's top-line mix.
Net investment income increased to $30.7 million from $18.7 million a year ago, driven by the addition of the Apollo portfolio, a higher-yield environment and a larger invested asset base.
Skyward Group's Underwriting Mix Fuels Growth
Within Skyward Group's U.S. specialty operations, several underwriting divisions posted notable momentum. Accident & Health gross written premiums increased 57.8% year over year, Credit & Surety rose 15.6%, Global Agriculture advanced 95.8% and Specialty Programs jumped 29.7%, helping offset declines in Captives, Energy Solutions and Global Property.
The Skyward Specialty segment's loss and LAE ratio increased primarily because of shifts in business mix, driven by growth in Accident & Health and Global Agriculture. At the same time, the segment's expense ratio improved, driven by business mix shifts, enhanced operating efficiencies and scale benefits.
SKWD's Expenses
Losses and loss adjustment expenses amounted to $276.7 million, up from $181.3 million in the prior-year quarter, consistent with the expansion of the premium base. The consolidated loss ratio deteriorated to 62.3% from 61.3% a year ago, primarily reflecting business-mix shifts within the Skyward Specialty segment. Total Cat loss and LAE increased to 1.9% from 1.4% a year ago.
Underwriting, acquisition and insurance expenses rose to $123.3 million from $85.6 million a year ago, reflecting higher activity levels and a larger operating platform. On the ratio side, net policy acquisition costs increased to 16.0% from 15.1% a year ago, while the total expense ratio improved to 27.2% from 28.1%.
The combined ratio increased slightly to 89.5% from 89.4% a year ago.
SKWD's Q2 Financials Update
On the balance sheet, cash and cash equivalents rose to $219.2 million from $168.5 million as of 2025-end. Total assets reached $6.8 billion as of June 30, 2026, up from $4.8 billion as of 2025-end.
Notes payable jumped to $417.6 million from $100.4 million as of 2025-end.
Book value per share was approximately $28.55, up 14.6% from the figure as of Dec. 31, 2025.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
VGM Scores
Currently, Skyward has a average Growth Score of C, however its Momentum Score is doing a lot better with an A. Following the exact same course, the stock has a score of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Skyward has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Skyward is part of the Zacks Insurance - Property and Casualty industry. Over the past month, Kinsale Capital Group, Inc. (KNSL), a stock from the same industry, has gained 1.6%. The company reported its results for the quarter ended June 2026 more than a month ago.
Kinsale Capital Group reported revenues of $548.52 million in the last reported quarter, representing a year-over-year change of +16.8%. EPS of $5.54 for the same period compares with $4.78 a year ago.
Kinsale Capital Group is expected to post earnings of $4.87 per share for the current quarter, representing a year-over-year change of -6.5%. Over the last 30 days, the Zacks Consensus Estimate has changed -0.3%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Kinsale Capital Group. Also, the stock has a VGM Score of D.
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This article originally published on Zacks Investment Research (zacks.com).
