Fundamentals snapshot
ACGL · NMS · Financial Services · Insurance - Diversified
Current price
$101.27
52-week range
$82.45 - $107.09
Market cap
$34.56B
One-glance verdict
We don't put a cash-flow fair value on banks and insurers. For these companies the reported 'cash flow' is really just money moving between loans, deposits and trades — not the leftover profit the owners could actually pocket — so the usual method would print a misleading number.
Balance sheet
Net cash $178.00M. Interest coverage shows how many times profit covers the interest bill.
What stands out
What this company does
Arch Capital Group sells insurance and reinsurance, which are ways for businesses and individuals to protect themselves financially from unexpected events, and also offers mortgage insurance. Most of their money comes from premiums paid by customers for these insurance policies, and this matters because it's the core business that generates their income.
Arch Capital Group Ltd. started in 1995, originally named Risk Capital Holdings, Inc., with a focus on providing insurance and reinsurance. It was founded in Bermuda, a hub for the insurance industry. Over the years, the company has grown significantly by expanding its product offerings and geographical reach. This growth has been driven by strategic acquisitions and a consistent focus on underwriting profitability, allowing it to become a major player in the global insurance and mortgage insurance markets.
Arch Capital Group provides a variety of insurance and financial products designed to protect individuals and businesses from financial losses. Think of it like buying a safety net for unexpected events. They offer insurance for businesses, protection against large-scale disasters through reinsurance, and specialized insurance for mortgages. Essentially, they take on risk in exchange for premiums, aiming to pay out claims when covered events occur while keeping enough to remain profitable.
This segment is where Arch Capital offers direct insurance policies to businesses. They cover a wide range of risks, including commercial auto accidents, property damage for businesses, professional liability (like errors made by doctors or lawyers), and workers' compensation for employee injuries. When a business buys a policy from Arch, they are essentially paying Arch to cover potential financial losses from these specific events. This is a significant part of Arch's business, providing a steady stream of premium income.
Reinsurance is like insurance for insurance companies. In this segment, Arch Capital takes on a portion of the risk that other insurance companies have underwritten. For example, if a large insurance company insures a major event like a hurricane, it might buy reinsurance from Arch to reduce its own potential payout. This helps spread risk across the industry and allows primary insurers to take on larger policies. This segment is crucial for managing large-scale risks and contributes substantially to Arch's overall operations.
The Mortgage segment focuses on insuring loans that are used to buy property. When someone takes out a mortgage, the lender (like a bank) might require mortgage insurance, especially if the borrower has a smaller down payment. Arch provides this insurance, protecting the lender if the borrower defaults on the loan. They also engage in mortgage reinsurance, taking on some of the risk from other mortgage insurers, and offer international mortgage insurance. This business line is vital for enabling homeownership by reducing risk for lenders.
Arch Capital's management is focused on profitable growth across its insurance, reinsurance, and mortgage segments. A key strategy involves expanding their specialty insurance offerings, which often come with higher premiums due to their unique risks. They are also concentrating on disciplined underwriting, meaning they carefully select which risks to insure and at what price, to ensure profitability. Furthermore, Arch continues to invest in technology and data analytics to better assess and manage risk, aiming to improve efficiency and decision-making across all their business lines.
Price history
Earnings history
Click any quarter to read the call summary and what the numbers say.
Is it cheap or expensive?
For a bank or insurer, the "free cash flow" shown on its statements is mostly money flowing through loans, deposits and trades — not the leftover profit the owners could actually keep, which is what this kind of valuation needs. Running that through the usual method would spit out a meaningless number, so we leave the cash-flow fair value out here rather than show you something misleading.
Is it drowning in debt?
Net cash $178.0M - more cash than debt. Interest coverage 34.6x.
Arch Capital Group Ltd.'s profit covers its interest bill about 34.6 times over. which is stronger than every peer shown here.
Total debt $4.29B Interest coverage 34.64x This is the baseline the peer rows are being compared against.
Total debt $1.49B Interest coverage 19.24x -44% vs ACGL Carries about 1.8x less debt cushion than ACGL.
Total debt $25.01B Interest coverage 18.07x -48% vs ACGL Carries about 1.9x less debt cushion than ACGL.
Total debt $4.38B Interest coverage 24.92x -28% vs ACGL Carries about 1.4x less debt cushion than ACGL.
Total debt $9.13B Interest coverage 10.80x -69% vs ACGL Carries about 3.2x less debt cushion than ACGL.
What you should know
The numbers
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Valuation
Profitability
Health
Growth
Cash flow
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Debt comparison
What you should know