# Pelagos paid another company $254 million in nine months to underwrite its business, and the stock still trades near book value PLGO, NYSE. Published November 12, 2026. Price as of the November 12, 2026 regular session close, from an XTB quote taken after the NYSE close (not confirmed on a screener). Values are in US dollars. Latest reported quarter: July to September 2026. Formerly Fidelis Insurance Holdings. ## Verdict: HOLD at $28.83 Pelagos earns a good return on a book that is growing, and the price already reflects it. At $28.83 the stock trades at 1.08 times book value and 4% below my Base value of $29.95. With confidence at C the required margin of safety is 42.5%, so new money waits for $17.22 or less. Existing holders can stay, with a review above $39.48. - Bear value: $21.98 - Base value: $29.95 - Bull value: $39.48 - Upside to base value: +3.9% - Maximum buy price: $17.22 - Required margin of safety: 42.5% - Price to book value per share ($26.60): 1.08x - Combined ratio, first nine months: 92.4% - Quarterly dividend, raised from $0.15: $0.22 - Debt to total capital: 25.2% - Business quality: 56.25/100 - Valuation score: 42.5/100 - Confidence: 17.5/25, grade C Pelagos Insurance Capital lists 108 employees. Much of the business it insures is originated and underwritten by The Fidelis Partnership, a separately owned managing agency that earned $254.1 million of commissions from Pelagos in the first nine months of 2026, 13.1 points of the combined ratio. The arrangement has worked: book value per diluted share has risen from $16.24 at the January 2023 separation to $26.60, and the third quarter combined ratio was 91.5%. My Base value is $29.95 a share, the Bear value $21.98 and the Bull value $39.48. The stock is up 57% over the past year according to XTB and sits about 4% below my Base. At that price the Base earns about 12% a year over five years, above the 10% I require, but the Bear is 24% below the price, and earnings in this industry swing with catastrophes: the annualized operating return on equity was 15.2% in the first quarter, 5.1% in the second and 15.3% in the third. Valuation route: property and casualty reinsurer and specialty insurer, valued with a model of the excess return on equity over a 10% cost of equity, built from book value and a normalized combined ratio, cross-checked with a price to book multiple. Free cash flow is not used, because an insurer's cash flow follows premiums and claim payments, and a growth-adjusted multiple is not meaningful when earnings swing with catastrophes. ## What Pelagos is Pelagos calls itself a capital allocator and risk selector in specialty insurance and reinsurance. It was founded in 2014, separated and listed on the NYSE in 2023, and renamed from Fidelis Insurance Holdings in May 2026. It writes more than 100 products in two segments, Insurance and Reinsurance, and offers quota share and excess of loss cover, and it also supports Lloyd's syndicates through funds at Lloyd's. The structure matters for the valuation. The Fidelis Partnership is separately owned and managed and receives a ceding commission of 11.5% of net premiums on open-market business (3.0% on business from third-party underwriting agents), a portfolio management fee of 3.0%, and a profit commission of 20% of operating profit above a 5% underwriting return on equity. The 10-year framework agreement was rolled on September 18, 2026. The upside is access to business Pelagos could not source alone. The cost is a fee that is paid whether or not the business earns a profit, and an underwriter whose interests are close to, but not the same as, shareholders'. ## The latest results | $ millions | Q3 2026 | Q3 2025 | 9M 2026 | 9M 2025 | | --- | --- | --- | --- | --- | | Gross premiums written | 839.8 | 797.5 | 3,977.0 | 3,739.0 | | Net premiums earned | 783.7 | n/a | 1,933.3 | n/a | | Combined ratio | 91.5% | 79.0% | 92.4% | 99.5% | | Underwriting income | 67.0 | 125.5 | n/a | n/a | | Net investment income | 44.6 | 45.9 | 132.3 | 140.0 | | Net income | 61.7 | n/a | 214.1 | n/a | | Operating net income | 83.3 | n/a | 200.4 | n/a | | Annualized operating ROAE | 15.3% | 21.4% | 11.8% | 5.2% | Gross premiums grew 5.3% in the quarter, driven by Insurance ($686.1 million versus $605.8 million), while Reinsurance fell to $153.7 million from $191.7 million. The combined ratio rose to 91.5% from an unusually benign 79.0% a year earlier, because catastrophe and large losses were $115.9 million, or 14.8 points of net premiums earned, and prior-year reserves moved $4.7 million the wrong way. Operating earnings per share were $1.00 against about $0.82 expected by analysts, according to Earnings Whispers. | Share of net premiums earned | Q3 2026 | 9M 2026 | | --- | --- | --- | | Loss ratio | 44.9% | 44.9% | | Policy acquisition costs | 30.4% | 29.8% | | The Fidelis Partnership commissions | 12.4% | 13.1% | | General and administrative | 3.8% | 4.6% | | Combined ratio | 91.5% | 92.4% | Excluding reserve movements the combined ratio was 90.9% in the quarter and about 94.0% for nine months (my arithmetic: the nine month figure benefited from $31.1 million of favorable reserve development, worth 1.6 points). Net income for nine months includes a $21.4 million release of a UK minimum tax accrual in the first quarter, which will not repeat. The company gave no numeric guidance for 2026 or 2027 in the release; the chief executive said Pelagos is well positioned to accelerate growth. ## Book value and the combined ratio For an insurer the numbers that matter are book value per share and the combined ratio, the share of premiums that goes to claims and costs, where anything under 100% is an underwriting profit. Book value per diluted share was $26.60 at September 30, up 8.1% from $24.61 at the end of 2025. Excluding AOCI, the unrealized gain or loss on bonds, it was $27.11, up 11.9%. AOCI moved from +$37.1 million to -$41.6 million as interest rates rose. | Per share and premiums | 2022 | 2023 | 2024 | 2025 | Sep 2026 | | --- | --- | --- | --- | --- | --- | | Book value per diluted share, $ | 16.24 | 20.69 | 21.79 | 24.61 | 26.60 | | Gross premiums written, $ billions | 3.0 | 3.6 | 4.4 | 4.7 | 5.0 | Book value per share is up 64% since the separation, and premiums are up 67%. Both lines hide a volatile path: operating net income was $137 million in 2024 after $287 million of adverse development on aviation claims linked to the Ukraine conflict, and the first half of 2025 ran at a 110.1% combined ratio. The nine-month 2026 ratio of 92.4% is a recovery, not a steady state. ## Debt, shares and capital allocation | September 30, 2026, $ millions | Amount | | --- | --- | | Total investments | 3,722.9 | | Cash and equivalents | 446.1 | | Restricted cash | 80.2 | | 4.875% senior notes due 2030 | 330.0 | | 7.750% subordinated notes due 2055 | 400.0 | | Total debt, net of discount | 720.8 | | Shareholders' equity (no preferred shares) | 2,141.2 | | Debt to total capital | 25.2% | | Gross loss reserves | 2,930.6 | | Net loss reserves | 1,618.2 | Debt is $720.8 million, 25.2% of total capital, after the company redeemed $125 million of junior notes in April 2026. The 7.75% subordinated notes reset in 2035 to the five-year US Treasury yield plus 4.28 points. Investments are mostly bonds (fixed maturities $2,792.7 million, duration 3.0 years, so a 1 point rise in yields cuts their value by about $95.6 million or 2.9%), plus $364.2 million of hedge funds. The net investment yield was 4.6% in the quarter. I could not find a Bermuda solvency ratio or the credit rating levels in the filing text I read, so I treat capital adequacy as an open gap. Gross loss reserves are $2,930.6 million and net reserves $1,618.2 million, with $1,312.4 million recoverable from reinsurers. In nine months the company bought back 17.7 million shares for $362.5 million at an average of $20.47, and paid $38.4 million of dividends, a total of $400.9 million against $214.1 million of net income, so equity fell from $2,399.6 million to $2,141.2 million. Shares outstanding were 79.3 million at September 30 against 85.5 million at the end of 2025. The third quarter purchases averaged $24.55, below book value of $26.60. At today's $28.83, the stock is above book, so each new dollar of buyback adds less to book value per share, and the board renewed the authorization to $400 million on November 3, which at this price is about 17% of the shares. ## Primary valuation: excess returns on equity I value the company as its book value plus the present value of the returns it earns above the 10% cost of equity (my assumption for a specialty reinsurer with catastrophe exposure). Each case starts from a normalized year, with premiums of $2.75 billion (my estimate, a little above the 2026 run rate) and a combined ratio, then the return on equity fades over ten years toward a terminal level and equity grows at a set rate, with the rest distributed. Excess returns after year ten are counted only when positive. | Year-1 earnings, $ millions | Bear | Base | Bull | | --- | --- | --- | --- | | Net premiums earned (my estimate) | 2,750 | 2,750 | 2,750 | | Combined ratio | 98% | 93% | 89% | | Underwriting income | 55 | 192 | 302 | | Net investment income | 170 | 175 | 180 | | Interest on debt | -49 | -49 | -49 | | Tax at 15% | -26 | -48 | -65 | | Net income | 150 | 271 | 368 | | Return on opening equity | 7.0% | 12.6% | 17.2% | | Earnings per share, $ | 1.86 | 3.36 | 4.58 | | Case | Return on equity, year 1 | Return on equity, year 10 | Equity growth a year | PV of excess returns, $ M | Value per share | | --- | --- | --- | --- | --- | --- | | Bear | 7.0% | 8.5% | 2% | -335 | $22.44 | | Base | 12.6% | 10.5% | 3% | 306 | $30.40 | | Bull | 17.2% | 12.5% | 4% | 1,086 | $40.09 | Excess returns after year ten are 2% of the Base value (Bear zero, Bull 9%), and the first ten years of excess returns add only $3.11 a share to the starting book value, so the Base is close to book value plus a modest premium. The Base combined ratio of 93% sits between the 9M 2026 result excluding reserves (94.0%) and the third quarter (90.9%), and well above the mid to high 80s the company has targeted, because a normal year includes a larger catastrophe load than the benign quarters of 2025. The Base return on equity of 12.6% fades to 10.5% by year ten as pricing softens, which leaves just over the cost of equity at the end. ### Sensitivity | ROE year 1 \ ROE year 10 | 9.5% | 10.5% | 11.5% | | --- | --- | --- | --- | | 10.5% | $26.71 | $28.20 | $30.39 | | 12.5% | $28.76 | $30.25 | $32.44 | | 14.5% | $30.81 | $32.31 | $34.49 | | Cost of equity \ equity growth | 2% | 3% | 4% | | --- | --- | --- | --- | | 9% | $33.86 | $34.26 | $34.68 | | 10% | $30.25 | $30.40 | $30.56 | | 11% | $27.84 | $27.86 | $27.87 | | One change at a time, primary Base $30.40 | Value | | --- | --- | | Combined ratio 1 point worse / better every year (ROE 1.1 points) | $27.71 / $33.91 | | Cost of equity 11% / 9% | $27.86 / $34.26 | | Starting ROE 10.5% / 14.5% | $28.20 / $32.31 | | Year-10 ROE 9.5% / 11.5% | $28.76 / $32.44 | | Equity growth 2% / 4% | $30.25 / $30.56 | Each point of combined ratio held for ten years is worth about $3.50 a share and each point of cost of equity about $2.5 to $3.5, so the discount rate and the underwriting margin matter about equally. Equity growth barely changes the value, which is what you would expect from a company that returns most of its earnings. ## Secondary valuation: price to book The second method multiplies book value per share ($26.60) by a price to book multiple: 1.10 times for the Base, 0.80 times for the Bear and 1.45 times for the Bull. Hamilton, SiriusPoint and RenaissanceRe trade at 1.26 to 1.33 times book, but they reported trailing returns on equity of 21% to 31% against 17.6% for Pelagos, so I set the Base below the peers and the Bear near the 0.7 to 0.9 times book at which the company itself bought stock this year. | Case | P/B multiple | Book value per share | Value per share | | --- | --- | --- | --- | | Bear | 0.80x | $26.60 | $21.28 | | Base | 1.10x | $26.60 | $29.26 | | Bull | 1.45x | $26.60 | $38.57 | | P/B multiple \ book value per share | $25.60 | $26.60 | $27.60 | | --- | --- | --- | --- | | 1.00x | $25.60 | $26.60 | $27.60 | | 1.10x | $28.16 | $29.26 | $30.36 | | 1.25x | $32.00 | $33.25 | $34.50 | | Company | Price to book | Trailing ROE | Forward P/E | Data date | | --- | --- | --- | --- | --- | | Pelagos at $25.99 | 0.97x | 17.6% | 6.7x | Oct 26, 2026 | | Hamilton at $36.32 | 1.26x | 31.1% | 8.0x | Oct 23, 2026 | | SiriusPoint at $25.41 (intraday) | 1.32x | 23.1% | 9.6x | Sep 25, 2026 | | RenaissanceRe at $351.66 | 1.33x | 21.5% | 8.0x | Oct 26, 2026 | The peer figures come from a screener and carry different dates, so they bracket the multiple and do not set it. Each 0.1 turn of the multiple moves the value by $2.66 a share. Both methods are driven by the same return on equity, so their agreement is not independent evidence, and book value includes a $0.52 a share AOCI loss that would reverse if yields fall. ## Cross-check against the stock's own range At $19.00 in the first quarter and $24.55 in the third, the company was buying its own stock at 0.7 to 0.9 times book. The price has since risen to $28.83, or 1.08 times book, and 57% in a year. The stock moved from below book to above it while book value rose 8%, so most of the gain came from the multiple. A buyer today is paying for the recovery that has already happened. ## Valuation triangulation | Method | Bear | Base | Bull | Weight | | --- | --- | --- | --- | --- | | Excess returns on equity | $22.44 | $30.40 | $40.09 | 60% | | Price to book | $21.28 | $29.26 | $38.57 | 40% | | Gap between methods | 5.3% | 3.8% | 3.9% | | | Adopted | $21.98 | $29.95 | $39.48 | | The two methods differ by 3.8% at the Base, far inside the 20% limit, but they share the return on equity, so I do not count the agreement as extra confidence. The weights are 60% for the excess returns model, because it follows the return path, and 40% for the multiple, because it reflects what buyers pay. | Base case | Value per share | Price to book | Price to normalized EPS | ROE the value implies | | --- | --- | --- | --- | --- | | Excess returns | $30.40 | 1.14x | 9.0x | 11.0% | | Price to book at 1.10x | $29.26 | 1.10x | 8.7x | 10.7% | | Market at $28.83 | $28.83 | 1.08x | 8.6x | 10.6% | On a common basis the methods value the same business at 1.14 and 1.10 times book, against 1.08 in the market, and each corresponds to a sustainable return on equity of about 10.8% to 11.0% at 3% growth. The probability-weighted value, with 25% Bear, 50% Base and 25% Bull, is $30.34, within 1.3% of the Base. ## What is the market already pricing in? | Measure at $28.83 | Value | | --- | --- | | Market value of common shares | $2,321 million | | Price to book value per diluted share ($26.60) | 1.08x | | Price to book excluding AOCI ($27.11) | 1.06x | | Price to my normalized earnings per share ($3.36) | 8.6x | | Dividend yield on $0.88 a year | 3.1% | | Sustainable ROE the price implies at 3% growth | 10.6% | | Constant ROE for ten years that justifies the price | 10.7% | | Return the Base gives at this price | 11.8% a year | | Buyback authorization at this price | $400 million, 17% of shares | The price requires a return on equity of about 10.7% held for ten years, which is slightly above the cost of equity and below the 11.8% the company earned over nine months at a 92.4% combined ratio. That is not demanding. It is also not cheap: the market is paying for the recent combined ratios to continue, and the Base needs a combined ratio near 93% on a book that has been shrinking because buybacks and dividends exceed earnings. ## Bear, base and bull scenarios | Case | Combined ratio, year 1 | Return on equity, year 1 | Primary | Secondary | Adopted | Versus price | | --- | --- | --- | --- | --- | --- | --- | | Bear | 98% | 7.0% | $22.44 | $21.28 | $21.98 | -23.8% | | Base | 93% | 12.6% | $30.40 | $29.26 | $29.95 | +3.9% | | Bull | 89% | 17.2% | $40.09 | $38.57 | $39.48 | +37.0% | - **Bear:** a softer market and heavier losses push the combined ratio to 98%, the return on equity to 7.0% and later 8.5%, below the cost of equity. Reserves develop adversely again, as in 2024 and 2025. The multiple falls to 0.80 times book. - **Base:** a 93% combined ratio on $2.75 billion of premiums, a 12.6% return on equity that fades to 10.5%, and an exit at 1.10 times book. - **Bull:** an 89% combined ratio, in line with the company's own target range, a 17.2% return on equity fading to 12.5%, and a multiple of 1.45 times book, close to the peers. The Bear sits 24% below the price and the Bull 37% above it, so the range is wide and slightly tilted to the upside, but the downside case is a real one: it happened in 2024 and the first half of 2025. | Bought at $28.83, held 5 years | Return a year | | --- | --- | | Base: exit at 1.10x book | 11.8% | | Base, if today's 1.08x multiple did not change | 11.5% | | Bear: exit at 0.80x book | 1.5% | | Bull: exit at 1.45x book | 20.5% | These returns are my arithmetic, not forecasts. They assume the company distributes everything it earns beyond the 3% equity growth, at a fair price. The difference between the first two rows, 0.3 points a year, is what a rise in the multiple adds. ## How the buy price is set The required margin of safety follows the confidence grade, and grade C starts at 42.5%. I add nothing: catastrophe losses, reserve risk and the commission structure are in the Bear case and the confidence score, and I do not charge them a second time. $29.95 times 0.575 is **$17.22**, or 0.65 times book value. The two methods give $16.82 and $17.48 separately. That price is below the $19 to $25 range at which the company bought stock this year, so I do not expect it to come back without a market event. I report it because the rule is the same for every analysis on this site. At today's price the Base earns 11.8% a year, which is above the 10% cost of equity, so the stock is not expensive by that test; the 42.5% margin is a charge for the model's uncertainty, which I treat strictly. | Entry price | Base return a year over 5 years | | --- | --- | | $17.22 | 26.5% | | $22.00 | 19.1% | | $25.00 | 15.6% | | $28.83 | 11.8% | | $32.00 | 9.1% | For an existing holder the price is close to the Base and a hold, and I would review a holding above the Bull value of $39.48. One timing point: the next dividend of $0.22 goes ex on or about December 11, so the price will open about that much lower without anything having changed. ## Dividend and capital return The quarterly dividend is raised to $0.22 from $0.15, payable December 23 to holders of record on December 11. That is $0.88 a year, a 3.1% yield, and about 26% of my normalized earnings per share of $3.36. Buybacks are the larger lever: $362.5 million in nine months against $38.4 million of dividends. The board renewed a $400 million authorization on November 3, with $56.1 million unused at September 30. The test of the policy is book value per share, and it rose 8.1% in nine months with equity shrinking 11% from buybacks and dividends, because the buybacks were below book. ## Reasons to own Pelagos - Book value per diluted share has grown from $16.24 to $26.60 since the 2023 separation, with cumulative dividends on top. - A combined ratio of 92.4% for nine months, 91.5% in the quarter, and a 15.3% annualized operating return on equity. - Aggressive and so far well-timed buybacks: 17.7 million shares at an average of $20.47, which cut the share count about 7% in nine months. - A 47% dividend increase to $0.22 a quarter. - Premium growth of 5% to 6% with Insurance up 13% in the quarter, through underwriting partners that give access to specialty business. ## What could go wrong? - **Catastrophe and large losses:** $115.9 million in one quarter, 14.8 points of premiums. A larger event can erase a quarter's profit, as in the second quarter, when the annualized return was 5.1%. - **Reserves:** prior-year development was adverse by $4.7 million in the quarter, and the Insurance segment was adverse by $10.3 million over nine months (Baltimore bridge, political risk, property). Aviation claims cost $287 million in 2024. - **Underwriter alignment:** The Fidelis Partnership earns commissions of 13.1% of premiums, larger than the whole 7.6 point underwriting margin of the first nine months. - **Softening market:** Reinsurance premiums fell 20% in the quarter and 36% of gross premiums are ceded, so results depend on the price and credit of reinsurers ($1.3 billion recoverable on reserves). - **Leverage and capital:** debt to total capital is 25.2% and I found no solvency ratio in the text I read. A $340 million letter of credit program is in place, with one facility expired on September 18. - **Markets:** a 1 point rise in yields cuts the bond portfolio by about 2.9%, hedge funds are $364.2 million, and the credit loss provision rose $15.7 million in the quarter. - **Buying above book:** at $28.83 repurchases dilute book value per share rather than raise it. ## Management execution Management has grown book value per share by 64% since the separation and returned capital steadily, including $95.2 million in the third quarter. The weaker record is underwriting results in 2024 and the first half of 2025, when adverse development on aviation claims and heavy catastrophe losses pushed the combined ratio above 100%. The first nine months of 2026 are the first sustained evidence of better results, and nine months is short. ## Stock Analyza scorecard | Business quality | Score | | --- | --- | | Moat and pricing power | 10/20 | | Return on capital over its cost | 10/20 | | Balance sheet and resilience | 11.25/15 | | Earnings quality | 7.5/15 | | Growth and reinvestment runway | 7.5/15 | | Management and capital allocation | 7.5/10 | | Dilution and governance | 2.5/5 | | Total | 56.25/100 | Business quality is middling. The company earns a return above its cost of capital in a normal year, but the spread is about 2.5 points, and the franchise relies on a partner it does not control. The balance sheet is adequate, with moderate leverage. Earnings quality scores lower because reserve development and catastrophe losses move results by more than the underlying trend, and one tax release flattered 2026. | Valuation | Score | | --- | --- | | Discount to Base value (3.7%) | 25/50 | | Price against the Bear value (-23.8%) | 7.5/30 | | What the price implies (the central case) | 10/20 | | Total | 42.5/100 | The valuation score is in the middle because the price is near the Base, but the Bear is 24% below the price, which falls in the second-lowest band; a price of $27.40 or lower would have scored the second component 15 of 30. ## Confidence score | Area | Score | | --- | --- | | Historical data and sources | 3.75/5 | | Accounting and ownership (reserves, commissions to a related firm, no solvency ratio found) | 3.75/5 | | Evidence for the forecast (no company guidance in the release) | 2.5/5 | | Model construction (return on equity drives both methods) | 3.75/5 | | Independent challenge (peer data from screeners, different dates) | 3.75/5 | | Total, grade C | 17.5/25 | The raw score of 17.5 is half a point under grade B, so the grade is C and the margin of safety 42.5%. The gaps are the solvency ratio and rating levels, the absence of company guidance, and peer data from screeners. A solvency ratio in the high range, a combined ratio under 93% in the fourth quarter and a fully checked peer set would lift the grade to B, cut the margin of safety to 30% and raise the buy price to about $20.96. ## What I would watch from here ### Green - Fourth quarter combined ratio at or below 92% - Prior-year reserve development favorable or neutral - Gross premiums growing 5% or more, with Reinsurance stabilizing - Buybacks made at or below book value ### Yellow - Combined ratio between 93% and 96% in a quarter - Reinsurance premiums falling by 15% or more again - Debt to total capital above 26% ### Red - Combined ratio above 97% in two quarters - Adverse reserve development above $50 million in a quarter - Buybacks above 1.2 times book value - A rating downgrade or a solvency ratio near the regulatory minimum The fourth quarter report and 2027 premium outlook are the first test of whether the third quarter was typical or lucky. ## The three most important thesis breakers 1. Catastrophe losses and adverse reserves keep the combined ratio near 98%, turning the Base into the Bear. 2. The market softens and Reinsurance shrinks, so premiums stop growing while fixed commissions to The Fidelis Partnership remain. 3. The multiple returns to 0.80 times book, taking about $8 off the price even if earnings are on plan. ## Stress test and independent check The model was built from the third quarter 2026 release and 6-K, the company's third quarter presentation and its earlier 2026 filings. The primary value, the secondary value, the triangulation, the buy price, the reverse tests, the sensitivity grids and the returns were recalculated in a separate script, and the numbers in the tables come from that script. | Input | Status | | --- | --- | | Premiums, income, ratios, balance sheet, debt, reserves, buybacks, dividend | Third quarter 2026 release and 6-K, as reported | | Book value and premium history | Company third quarter presentation, as reported | | Year-1 earnings bridge, normalized earnings per share, return paths | My estimates | | Peer multiples | StockAnalysis, different dates | | Price | XTB quote after the close, not confirmed on a screener | The weakest point is the normalized combined ratio. It rests on one good nine-month period after two bad ones, and each point is worth about $3.50 a share. The conservative choices are a Base combined ratio above the company's target, a cost of equity of 10%, and a fading return on equity. The generous choice is relying on the third quarter premium base of $2.75 billion. I did not use analyst price targets. ## Final verdict: hold at $28.83 Pelagos has done what a specialty insurer is supposed to do: grow book value, buy stock below it and raise the dividend. The price of 1.08 times book assumes that continues at a return on equity of about 11%, which the last nine months support and the two years before them did not. The Base earns 12% a year, but confidence is C and a Bear year costs about 24%. **Verdict: HOLD at $28.83, watchlist for new money. Base $29.95, +3.9% against the price, Bear $21.98, Bull $39.48, Confidence C (17.5/25). Required margin of safety 42.5%, maximum buy price $17.22, range $16.82 to $17.48 under the two methods.** The buy zone can come to the stock in two ways: a price near $17.22, or evidence of a steady combined ratio under 93% with a disclosed solvency ratio, which would lift the buy price to about $20.96. At 1.08 times book you are paid for the 15% quarters and charged for the 5% ones, and the second kind arrived as recently as June. ## More analyses on Patreon This analysis is free. Premium members get every in-depth analysis, the full archive and a vote on which stocks get analyzed next: https://www.patreon.com/stockanalyza ## Sources Primary sources are Pelagos's [third quarter 2026 results](https://www.sec.gov/Archives/edgar/data/0001636639/000162828026073047/ex-991earningspressrelease.htm) (November 11, 2026), the [third quarter 2026 report](https://www.sec.gov/Archives/edgar/data/0001636639/000162828026073047/fihl-20260930.htm) and the [third quarter presentation](https://www.sec.gov/Archives/edgar/data/0001636639/000162828026073047/pelagosinsurancecapitale.htm). Earlier quarters come from the [second quarter report](https://www.sec.gov/Archives/edgar/data/0001636639/000162828026056211/fihl-20260630.htm) and the [first quarter presentation](https://www.sec.gov/Archives/edgar/data/0001636639/000162828026034609/pelagosinsurancecapitale.htm). The company's [product page](https://www.pelagosinsurancecapital.com/products/) and [history page](https://www.pelagosinsurancecapital.com/about-us/history/) describe the business and The Fidelis Partnership, and [Insurance Business](https://www.insurancebusinessmag.com/uk/news/breaking-news/pelagos-posts-17point-combined-ratio-swing-as-cat-losses-double-in-q2-585984.aspx) reports the first half combined ratio and the rebrand. The analyst expectation for operating earnings comes from [Earnings Whispers](https://beta.earningswhispers.com/go/w/PLGO). Prices and peers: Pelagos and the peer multiples from [StockAnalysis](https://stockanalysis.com/stocks/plgo/statistics/) ([Hamilton](https://stockanalysis.com/stocks/hg/statistics/), [SiriusPoint](https://stockanalysis.com/stocks/spnt/statistics/), [RenaissanceRe](https://stockanalysis.com/stocks/rnr/statistics/)), the employee count from [Seeking Alpha](https://seekingalpha.com/symbol/plgo), the year-end 2025 share count from [EDGAR Tools](https://app.edgar.tools/companies/PLGO), and the $28.83 quote and one-year change from the XTB platform. **Disclaimer.** This analysis is provided solely for research and educational purposes. It is not personalized investment, financial, legal or tax advice. Values are estimates, not forecasts or trading instructions. Insurance and reinsurance stocks can move sharply with catastrophe losses, reserve changes and interest rates, and you can lose money. Do your own research and consider your own circumstances. Method: Master Investment Analysis Framework v4.3. Approach: excess returns on equity over a 10% cost of equity, built from book value and a normalized combined ratio, cross-checked with a price to book multiple. Confidence: C/17.5. Data checks: passed with warnings. Open data gaps: solvency ratio and rating levels, catastrophe loss detail, and a screener-confirmed closing price for November 12.