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ARCH CAPITAL GROUP LTD (ACGL) Stock Fundamental Analysis

NASDAQ:ACGL - Nasdaq - BMG0450A1053 - Common Stock - Currency: USD

91.9319  -0.92 (-0.99%)

Fundamental Rating

5

Taking everything into account, ACGL scores 5 out of 10 in our fundamental rating. ACGL was compared to 143 industry peers in the Insurance industry. ACGL has an excellent profitability rating, but there are concerns on its financial health. ACGL has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

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7

1. Profitability

1.1 Basic Checks

ACGL had positive earnings in the past year.
In the past year ACGL had a positive cash flow from operations.
Each year in the past 5 years ACGL has been profitable.
In the past 5 years ACGL always reported a positive cash flow from operatings.
ACGL Yearly Net Income VS EBIT VS OCF VS FCFACGL Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B

1.2 Ratios

ACGL's Return On Assets of 4.96% is amongst the best of the industry. ACGL outperforms 86.01% of its industry peers.
Looking at the Return On Equity, with a value of 17.29%, ACGL is in the better half of the industry, outperforming 78.32% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 3.96%, ACGL is in the better half of the industry, outperforming 74.83% of the companies in the same industry.
ACGL had an Average Return On Invested Capital over the past 3 years of 3.89%. This is in line with the industry average of 4.27%.
The last Return On Invested Capital (3.96%) for ACGL is above the 3 year average (3.89%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 4.96%
ROE 17.29%
ROIC 3.96%
ROA(3y)5.5%
ROA(5y)4.86%
ROE(3y)18.54%
ROE(5y)16.3%
ROIC(3y)3.89%
ROIC(5y)3.58%
ACGL Yearly ROA, ROE, ROICACGL Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5 10 15 20

1.3 Margins

ACGL's Profit Margin of 21.09% is amongst the best of the industry. ACGL outperforms 90.91% of its industry peers.
In the last couple of years the Profit Margin of ACGL has grown nicely.
The Operating Margin of ACGL (21.15%) is better than 81.82% of its industry peers.
In the last couple of years the Operating Margin of ACGL has declined.
Industry RankSector Rank
OM 21.15%
PM (TTM) 21.09%
GM N/A
OM growth 3Y4.67%
OM growth 5Y-2.93%
PM growth 3Y2.45%
PM growth 5Y1.58%
GM growth 3YN/A
GM growth 5YN/A
ACGL Yearly Profit, Operating, Gross MarginsACGL Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10 20 30

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3

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ACGL is destroying value.
ACGL has more shares outstanding than it did 1 year ago.
ACGL has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, ACGL has an improved debt to assets ratio.
ACGL Yearly Shares OutstandingACGL Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M 400M
ACGL Yearly Total Debt VS Total AssetsACGL Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 20B 40B 60B

2.2 Solvency

The Debt to FCF ratio of ACGL is 0.42, which is an excellent value as it means it would take ACGL, only 0.42 years of fcf income to pay off all of its debts.
ACGL has a better Debt to FCF ratio (0.42) than 79.72% of its industry peers.
A Debt/Equity ratio of 0.13 indicates that ACGL is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.13, ACGL is in the better half of the industry, outperforming 76.92% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.13
Debt/FCF 0.42
Altman-Z N/A
ROIC/WACC0.45
WACC8.73%
ACGL Yearly LT Debt VS Equity VS FCFACGL Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B 20B

2.3 Liquidity

Industry RankSector Rank
Current Ratio N/A
Quick Ratio N/A
ACGL Yearly Current Assets VS Current LiabilitesACGL Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M 400M

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5

3. Growth

3.1 Past

The earnings per share for ACGL have decreased by -8.83% in the last year.
Measured over the past years, ACGL shows a very strong growth in Earnings Per Share. The EPS has been growing by 26.96% on average per year.
Looking at the last year, ACGL shows a very strong growth in Revenue. The Revenue has grown by 26.93%.
ACGL shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 19.89% yearly.
EPS 1Y (TTM)-8.83%
EPS 3Y37.06%
EPS 5Y26.96%
EPS Q2Q%-37.14%
Revenue 1Y (TTM)26.93%
Revenue growth 3Y23.81%
Revenue growth 5Y19.89%
Sales Q2Q%10.53%

3.2 Future

Based on estimates for the next years, ACGL will show a small growth in Earnings Per Share. The EPS will grow by 3.09% on average per year.
Based on estimates for the next years, ACGL will show a small growth in Revenue. The Revenue will grow by 6.38% on average per year.
EPS Next Y-13.94%
EPS Next 2Y1.41%
EPS Next 3Y3.09%
EPS Next 5YN/A
Revenue Next Year10.37%
Revenue Next 2Y8.05%
Revenue Next 3Y6.38%
Revenue Next 5YN/A

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
ACGL Yearly Revenue VS EstimatesACGL Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 5B 10B 15B
ACGL Yearly EPS VS EstimatesACGL Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2 4 6 8 10

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5

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 11.00, which indicates a very decent valuation of ACGL.
Based on the Price/Earnings ratio, ACGL is valued a bit cheaper than 60.84% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.03. ACGL is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 9.64 indicates a reasonable valuation of ACGL.
ACGL's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of ACGL to the average of the S&P500 Index (21.94), we can say ACGL is valued rather cheaply.
Industry RankSector Rank
PE 11
Fwd PE 9.64
ACGL Price Earnings VS Forward Price EarningsACGL Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ACGL is on the same level as its industry peers.
ACGL's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ACGL is cheaper than 67.83% of the companies in the same industry.
Industry RankSector Rank
P/FCF 5.29
EV/EBITDA 9.11
ACGL Per share dataACGL EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 10 20 30 40 50

4.3 Compensation for Growth

ACGL has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.41
EPS Next 2Y1.41%
EPS Next 3Y3.09%

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5

5. Dividend

5.1 Amount

ACGL has a Yearly Dividend Yield of 5.29%, which is a nice return.
Compared to an average industry Dividend Yield of 3.17, ACGL pays a better dividend. On top of this ACGL pays more dividend than 90.21% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, ACGL pays a better dividend.
Industry RankSector Rank
Dividend Yield 5.29%

5.2 History

On average, the dividend of ACGL grows each year by 118.11%, which is quite nice.
ACGL does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)118.11%
Div Incr Years0
Div Non Decr Years0
ACGL Yearly Dividends per shareACGL Yearly Dividends per shareYearly Dividends per share 2024 1 2 3 4

5.3 Sustainability

51.29% of the earnings are spent on dividend by ACGL. This is a bit on the high side, but may be sustainable.
ACGL's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP51.29%
EPS Next 2Y1.41%
EPS Next 3Y3.09%
ACGL Yearly Income VS Free CF VS DividendACGL Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B
ACGL Dividend Payout.ACGL Dividend Payout, showing the Payout Ratio.ACGL Dividend Payout.PayoutRetained Earnings

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ARCH CAPITAL GROUP LTD

NASDAQ:ACGL (5/22/2025, 2:21:54 PM)

91.9319

-0.92 (-0.99%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)04-29 2025-04-29/amc
Earnings (Next)07-28 2025-07-28/amc
Inst Owners91.35%
Inst Owner Change1.05%
Ins Owners3.1%
Ins Owner Change9.86%
Market Cap34.53B
Analysts80.91
Price Target113.18 (23.11%)
Short Float %0.89%
Short Ratio1.91
Dividend
Industry RankSector Rank
Dividend Yield 5.29%
Yearly Dividend5.08
Dividend Growth(5Y)118.11%
DP51.29%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)17.8%
Min EPS beat(2)14.08%
Max EPS beat(2)21.52%
EPS beat(4)3
Avg EPS beat(4)12.33%
Min EPS beat(4)-0.36%
Max EPS beat(4)21.52%
EPS beat(8)7
Avg EPS beat(8)17.99%
EPS beat(12)11
Avg EPS beat(12)25.11%
EPS beat(16)15
Avg EPS beat(16)27.97%
Revenue beat(2)0
Avg Revenue beat(2)-5.15%
Min Revenue beat(2)-6.02%
Max Revenue beat(2)-4.29%
Revenue beat(4)1
Avg Revenue beat(4)-3.68%
Min Revenue beat(4)-6.09%
Max Revenue beat(4)1.66%
Revenue beat(8)5
Avg Revenue beat(8)-0.6%
Revenue beat(12)7
Avg Revenue beat(12)1.17%
Revenue beat(16)9
Avg Revenue beat(16)0.88%
PT rev (1m)-2.97%
PT rev (3m)-6.25%
EPS NQ rev (1m)-1.59%
EPS NQ rev (3m)-3.38%
EPS NY rev (1m)0.98%
EPS NY rev (3m)-4.19%
Revenue NQ rev (1m)-1.41%
Revenue NQ rev (3m)-1.41%
Revenue NY rev (1m)-1.04%
Revenue NY rev (3m)-1.9%
Valuation
Industry RankSector Rank
PE 11
Fwd PE 9.64
P/S 1.95
P/FCF 5.29
P/OCF 5.26
P/B 1.6
P/tB 1.71
EV/EBITDA 9.11
EPS(TTM)8.36
EY9.09%
EPS(NY)9.53
Fwd EY10.37%
FCF(TTM)17.36
FCFY18.89%
OCF(TTM)17.48
OCFY19.02%
SpS47.03
BVpS57.36
TBVpS53.88
PEG (NY)N/A
PEG (5Y)0.41
Profitability
Industry RankSector Rank
ROA 4.96%
ROE 17.29%
ROCE 5.01%
ROIC 3.96%
ROICexc 4.02%
ROICexgc 5.41%
OM 21.15%
PM (TTM) 21.09%
GM N/A
FCFM 36.92%
ROA(3y)5.5%
ROA(5y)4.86%
ROE(3y)18.54%
ROE(5y)16.3%
ROIC(3y)3.89%
ROIC(5y)3.58%
ROICexc(3y)3.95%
ROICexc(5y)3.65%
ROICexgc(3y)5.27%
ROICexgc(5y)4.8%
ROCE(3y)4.92%
ROCE(5y)4.54%
ROICexcg growth 3Y12.01%
ROICexcg growth 5Y3.19%
ROICexc growth 3Y11.28%
ROICexc growth 5Y2.52%
OM growth 3Y4.67%
OM growth 5Y-2.93%
PM growth 3Y2.45%
PM growth 5Y1.58%
GM growth 3YN/A
GM growth 5YN/A
F-Score6
Asset Turnover0.23
Health
Industry RankSector Rank
Debt/Equity 0.13
Debt/FCF 0.42
Debt/EBITDA 0.68
Cap/Depr 17.11%
Cap/Sales 0.25%
Interest Coverage 29.42
Cash Conversion 164.22%
Profit Quality 175.04%
Current Ratio N/A
Quick Ratio N/A
Altman-Z N/A
F-Score6
WACC8.73%
ROIC/WACC0.45
Cap/Depr(3y)41.7%
Cap/Depr(5y)46.55%
Cap/Sales(3y)0.41%
Cap/Sales(5y)0.43%
Profit Quality(3y)182.15%
Profit Quality(5y)183.38%
High Growth Momentum
Growth
EPS 1Y (TTM)-8.83%
EPS 3Y37.06%
EPS 5Y26.96%
EPS Q2Q%-37.14%
EPS Next Y-13.94%
EPS Next 2Y1.41%
EPS Next 3Y3.09%
EPS Next 5YN/A
Revenue 1Y (TTM)26.93%
Revenue growth 3Y23.81%
Revenue growth 5Y19.89%
Sales Q2Q%10.53%
Revenue Next Year10.37%
Revenue Next 2Y8.05%
Revenue Next 3Y6.38%
Revenue Next 5YN/A
EBIT growth 1Y7.85%
EBIT growth 3Y29.6%
EBIT growth 5Y16.38%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y56.19%
FCF growth 3Y25.05%
FCF growth 5Y26.92%
OCF growth 1Y55.37%
OCF growth 3Y24.87%
OCF growth 5Y26.64%