Arch Capital Group Ltd. (ACGL)

FairStock Score: 79/100 — HIGH CONVICTION

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach Arch as an insurer first and a stock second. The business writes insurance, reinsurance and mortgage insurance across several markets, and the filed record shows substantial earning power: in fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $4.7B, net income $1.1B, and diluted EPS $3.00. For FY2025 it reported $19.9B of revenue, $4.4B of net income and $11.60 of diluted EPS. FairStock's price-based numbers at the 2026-10-26 close are a P/E of 8.01 and P/B of 1.50, alongside a calculated ROE of 19.94% and low D/E of 0.18. That combination suggests the market is not paying much for a business that has earned high returns on equity. The computed Lynch category is FAST GROWER, based on 25.6% annual profit growth and 18.6% annual revenue growth over five years. But I must weigh that against the recent trend: FairStock shows revenue growth of -9.73% and profit growth of -14.55%, and fiscal Q2 2026 revenue of $4.7B was below the $5.2B filed for fiscal Q2 2025. The Piotroski F-Score is only 4/9. Insurance is cyclical and underwriting-sensitive; the data lacks the combined ratio, reserve development and CET1/NIM-type measures, so I cannot fully judge underwriting quality. At a modest multiple, with low leverage and strong ROE, this looks like a reasonably priced good business rather than an obvious bargain.

In plain English: The company sells insurance, reinsurance and mortgage insurance in several countries. It has made large profits and earned a high return on the money shareholders have put in, but revenue and profit have slipped recently. At the latest close, the price looks modest compared with earnings, though not a deep bargain compared with the company's accounting value.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer