ARCH CAPITAL GROUP LTD (ACGL) Stock Fundamental Analysis
NASDAQ:ACGL - BMG0450A1053 - Common Stock
91.035 USD
-0.26 (-0.28%)
Taking everything into account, ACGL scores 5 out of 10 in our fundamental rating. ACGL was compared to 146 industry peers in the Insurance industry. While ACGL is still in line with the averages on profitability rating, there are concerns on its financial health. ACGL is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year ACGL was profitable.
ACGL had a positive operating cash flow in the past year.
In the past 5 years ACGL has always been profitable.
In the past 5 years ACGL always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of ACGL (4.69%) is better than 83.56% of its industry peers.
ACGL has a better Return On Equity (16.03%) than 75.34% of its industry peers.
ACGL has a Return On Invested Capital of 3.80%. This is in the better half of the industry: ACGL outperforms 69.86% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ACGL is in line with the industry average of 4.47%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.69% | ||
| ROE | 16.03% | ||
| ROIC | 3.8% |
ROA(3y)5.5%
ROA(5y)4.86%
ROE(3y)18.54%
ROE(5y)16.3%
ROIC(3y)3.89%
ROIC(5y)3.58%
1.3 Margins
ACGL has a better Profit Margin (19.83%) than 91.78% of its industry peers.
ACGL's Profit Margin has improved in the last couple of years.
ACGL's Operating Margin of 20.17% is fine compared to the rest of the industry. ACGL outperforms 77.40% of its industry peers.
ACGL's Operating Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.17% | ||
| PM (TTM) | 19.83% | ||
| 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
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.
The debt/assets ratio for ACGL has been reduced compared to a year ago.
2.2 Solvency
ACGL has a debt to FCF ratio of 0.45. This is a very positive value and a sign of high solvency as it would only need 0.45 years to pay back of all of its debts.
ACGL's Debt to FCF ratio of 0.45 is fine compared to the rest of the industry. ACGL outperforms 79.45% of its industry peers.
A Debt/Equity ratio of 0.12 indicates that ACGL is not too dependend on debt financing.
ACGL has a Debt to Equity ratio of 0.12. This is in the better half of the industry: ACGL outperforms 73.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.12 | ||
| Debt/FCF | 0.45 | ||
| Altman-Z | N/A |
ROIC/WACC0.45
WACC8.36%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
ACGL shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -14.77%.
The Earnings Per Share has been growing by 26.96% on average over the past years. This is a very strong growth
Looking at the last year, ACGL shows a very strong growth in Revenue. The Revenue has grown by 24.70%.
Measured over the past years, ACGL shows a quite strong growth in Revenue. The Revenue has been growing by 19.89% on average per year.
EPS 1Y (TTM)-14.77%
EPS 3Y37.06%
EPS 5Y26.96%
EPS Q2Q%0.39%
Revenue 1Y (TTM)24.7%
Revenue growth 3Y23.81%
Revenue growth 5Y19.89%
Sales Q2Q%15%
3.2 Future
ACGL is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 3.13% yearly.
ACGL is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.86% yearly.
EPS Next Y-11.02%
EPS Next 2Y0.96%
EPS Next 3Y3.13%
EPS Next 5YN/A
Revenue Next Year9.7%
Revenue Next 2Y7.8%
Revenue Next 3Y6.86%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 10.88, the valuation of ACGL can be described as reasonable.
ACGL's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of ACGL to the average of the S&P500 Index (27.02), we can say ACGL is valued rather cheaply.
ACGL is valuated reasonably with a Price/Forward Earnings ratio of 9.64.
The rest of the industry has a similar Price/Forward Earnings ratio as ACGL.
ACGL is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.66, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.88 | ||
| Fwd PE | 9.64 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as ACGL.
Based on the Price/Free Cash Flow ratio, ACGL is valued a bit cheaper than the industry average as 70.55% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 5.55 | ||
| EV/EBITDA | 8.84 |
4.3 Compensation for Growth
The decent profitability rating of ACGL may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.4
EPS Next 2Y0.96%
EPS Next 3Y3.13%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.36%, ACGL is a good candidate for dividend investing.
ACGL's Dividend Yield is rather good when compared to the industry average which is at 3.63. ACGL pays more dividend than 85.62% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.45, ACGL pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.36% |
5.2 History
On average, the dividend of ACGL grows each year by 118.11%, which is quite nice.
ACGL is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)118.11%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
ACGL pays out 51.79% of its income as dividend. 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.
DP51.79%
EPS Next 2Y0.96%
EPS Next 3Y3.13%
NASDAQ:ACGL (9/8/2025, 12:21:13 PM)
91.035
-0.26 (-0.28%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners91.39%
Inst Owner Change-1.92%
Ins Owners3.13%
Ins Owner Change0.4%
Market Cap33.98B
Analysts78.33
Price Target110.36 (21.23%)
Short Float %1.68%
Short Ratio2.59
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.36% |
Yearly Dividend5.08
Dividend Growth(5Y)118.11%
DP51.79%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.67%
Min EPS beat(2)9.27%
Max EPS beat(2)14.08%
EPS beat(4)3
Avg EPS beat(4)11.13%
Min EPS beat(4)-0.36%
Max EPS beat(4)21.52%
EPS beat(8)7
Avg EPS beat(8)16.8%
EPS beat(12)11
Avg EPS beat(12)24.14%
EPS beat(16)15
Avg EPS beat(16)27.55%
Revenue beat(2)0
Avg Revenue beat(2)-4.12%
Min Revenue beat(2)-6.02%
Max Revenue beat(2)-2.23%
Revenue beat(4)1
Avg Revenue beat(4)-2.72%
Min Revenue beat(4)-6.02%
Max Revenue beat(4)1.66%
Revenue beat(8)4
Avg Revenue beat(8)-0.96%
Revenue beat(12)7
Avg Revenue beat(12)1.68%
Revenue beat(16)8
Avg Revenue beat(16)-1.23%
PT rev (1m)-0.31%
PT rev (3m)-3.92%
EPS NQ rev (1m)1.31%
EPS NQ rev (3m)0.06%
EPS NY rev (1m)3.46%
EPS NY rev (3m)3.4%
Revenue NQ rev (1m)-1.69%
Revenue NQ rev (3m)-2.76%
Revenue NY rev (1m)0.6%
Revenue NY rev (3m)0.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.88 | ||
| Fwd PE | 9.64 | ||
| P/S | 1.82 | ||
| P/FCF | 5.55 | ||
| P/OCF | 5.5 | ||
| P/B | 1.47 | ||
| P/tB | 1.56 | ||
| EV/EBITDA | 8.84 |
EPS(TTM)8.37
EY9.19%
EPS(NY)9.45
Fwd EY10.38%
FCF(TTM)16.42
FCFY18.03%
OCF(TTM)16.54
OCFY18.17%
SpS49.91
BVpS61.74
TBVpS58.2
PEG (NY)N/A
PEG (5Y)0.4
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.69% | ||
| ROE | 16.03% | ||
| ROCE | 4.81% | ||
| ROIC | 3.8% | ||
| ROICexc | 3.85% | ||
| ROICexgc | 5.18% | ||
| OM | 20.17% | ||
| PM (TTM) | 19.83% | ||
| GM | N/A | ||
| FCFM | 32.89% |
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 Turnover0.24
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.12 | ||
| Debt/FCF | 0.45 | ||
| Debt/EBITDA | 0.68 | ||
| Cap/Depr | 16.2% | ||
| Cap/Sales | 0.25% | ||
| Interest Coverage | 29.35 | ||
| Cash Conversion | 152.76% | ||
| Profit Quality | 165.86% | ||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z | N/A |
F-Score6
WACC8.36%
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)-14.77%
EPS 3Y37.06%
EPS 5Y26.96%
EPS Q2Q%0.39%
EPS Next Y-11.02%
EPS Next 2Y0.96%
EPS Next 3Y3.13%
EPS Next 5YN/A
Revenue 1Y (TTM)24.7%
Revenue growth 3Y23.81%
Revenue growth 5Y19.89%
Sales Q2Q%15%
Revenue Next Year9.7%
Revenue Next 2Y7.8%
Revenue Next 3Y6.86%
Revenue Next 5YN/A
EBIT growth 1Y-6.59%
EBIT growth 3Y29.6%
EBIT growth 5Y16.38%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y38.58%
FCF growth 3Y25.05%
FCF growth 5Y26.92%
OCF growth 1Y37.94%
OCF growth 3Y24.87%
OCF growth 5Y26.64%