Ricardo Pillai
2 min read
In This Article:
We came across a bullish thesis on Hamilton Insurance Group, Ltd. (HG) on Substack by Karst Research. In this article, we will summarize the bulls’ thesis on HG. Hamilton Insurance Group, Ltd. (HG)'s share was trading at $21.26 as of May 20th. HG’s trailing P/E was 6.95 according to Yahoo Finance.
A financial analyst presenting a chart of insurance solutions to a boardroom.
Hamilton Insurance Group, Ltd., a Bermuda-based specialty insurer, represents a compelling and underappreciated opportunity in global insurance markets. Operating through its International and Bermuda platforms under the Hamilton Global Specialty, Hamilton Select, and Hamilton Re brands, the company underwrites complex risks across casualty, specialty, and property lines. Its U.S.-focused Hamilton Select targets the fast-growing excess and surplus (E&S) market, while Hamilton Re provides global reinsurance solutions. This diversified structure provides both earnings balance and strategic flexibility.
Under the leadership of seasoned executives from Kinsale, Tokio Marine Kiln, and Chubb, Hamilton has executed a disciplined turnaround, emphasizing pricing rigor and portfolio optimization. This has led to a significant swing in profitability—from underwriting losses in 2022 to $149.4 million in underwriting income in 2024, with premiums written rising to $1.92 billion. The company’s strengthening fundamentals are further supported by growing Lloyd’s syndicate 4000 capacity, set to rise to GBP635 million in 2025, enabling meaningful international scale. Hamilton’s capital strength is equally notable, with a $4.9 billion investment portfolio emphasizing liquidity and quality, including nearly $1 billion in cash and a sophisticated $940 million allocation to a custom Two Sigma “fund-of-one.” With only $150 million in term debt and an opportunistic $137.6 million share buyback reducing the share count below pre-IPO levels, Hamilton is optimizing capital deployment to enhance shareholder value.
The stock is still overlooked, but the convergence of improving underwriting, strong capital allocation, and structural growth sets up a favorable risk/reward profile for investors, with long-term upside potential as the business continues to scale. Also, check out Skyward (SKWD), a quality insurer focused on niche markets.
Hamilton Insurance Group, Ltd. (HG) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 22 hedge fund portfolios held HG at the end of the fourth quarter which was 18 in the previous quarter. While we acknowledge the risk and potential of HG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than HG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
