Critical Review: Accelerant (ARX) & Its Competitors

Accelerant (NYSE:ARX) is one of 315 publicly-traded companies in the “Insurance” industry, but how does it weigh in compared to its rivals? We will compare Accelerant to related businesses based on the strength of its dividends, valuation, institutional ownership, analyst recommendations, earnings, risk and profitability.

Volatility & Risk

Accelerant has a beta of 0.08, meaning that its stock price is 92% less volatile than the S&P 500. Comparatively, Accelerant’s rivals have a beta of 0.62, meaning that their average stock price is 38% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Accelerant and its rivals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Accelerant	1	7	4	0	2.25
Accelerant Competitors	3236	15334	16147	688	2.40

Accelerant presently has a consensus price target of $18.95, indicating a potential downside of 4.77%. As a group, “Insurance” companies have a potential upside of 7.60%. Given Accelerant’s rivals stronger consensus rating and higher possible upside, analysts clearly believe Accelerant has less favorable growth aspects than its rivals.

Earnings and Valuation

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

	Gross Revenue	Net Income	Price/Earnings Ratio
Accelerant	$912.90 million	-$1.35 billion	-2.99
Accelerant Competitors	$15.54 billion	$1.69 billion	33.90

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%

Institutional and Insider Ownership

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

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.