Critical Review: Greenlight Capital Re (NASDAQ:GLRE) vs. Bowhead Specialty (NYSE:BOW)

Greenlight Capital Re (NASDAQ:GLRE) and Bowhead Specialty (NYSE:BOW) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, risk, dividends, earnings and analyst recommendations.

Analyst Ratings

This is a summary of current ratings and recommmendations for Greenlight Capital Re and Bowhead Specialty, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Greenlight Capital Re	0	0	1	0	3.00
Bowhead Specialty	0	4	4	1	2.67

Bowhead Specialty has a consensus price target of $31.83, indicating a potential upside of 33.80%. Given Bowhead Specialty’s higher possible upside, analysts clearly believe Bowhead Specialty is more favorable than Greenlight Capital Re.

Insider and Institutional Ownership

41.5% of Greenlight Capital Re shares are held by institutional investors. 23.5% of Greenlight Capital Re shares are held by insiders. Comparatively, 4.2% of Bowhead Specialty shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Risk and Volatility

Greenlight Capital Re has a beta of 0.39, suggesting that its share price is 61% less volatile than the S&P 500. Comparatively, Bowhead Specialty has a beta of -0.49, suggesting that its share price is 149% less volatile than the S&P 500.

Earnings & Valuation

This table compares Greenlight Capital Re and Bowhead Specialty”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Greenlight Capital Re	$683.21 million	0.93	$74.83 million	$2.18	8.57
Bowhead Specialty	$551.59 million	1.42	$53.79 million	$1.59	14.96

Greenlight Capital Re has higher revenue and earnings than Bowhead Specialty. Greenlight Capital Re is trading at a lower price-to-earnings ratio than Bowhead Specialty, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Greenlight Capital Re and Bowhead Specialty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Greenlight Capital Re	10.25%	11.10%	3.46%
Bowhead Specialty	9.75%	13.27%	2.73%

Summary

Greenlight Capital Re beats Bowhead Specialty on 9 of the 15 factors compared between the two stocks.

About Greenlight Capital Re

Greenlight Capital Re, Ltd., through its subsidiaries, operates as a property and casualty reinsurance company worldwide. The company offers various property reinsurance products and services, including automobile physical damage, personal lines, and commercial lines. It also provides casualty reinsurance products and services comprising general liability, motor liability, professional liability, and worker's compensation; and accident and health, transactional liability, mortgage insurance, surety, trade credit, marine, and energy, as well as other specialty products, such as aviation, crop, cyber, political, and terrorism products. The company markets its products through reinsurance brokers. Greenlight Capital Re, Ltd. was incorporated in 2004 and is headquartered in Grand Cayman, the Cayman Islands.

About Bowhead Specialty

Bowhead Specialty Holdings Inc. provides specialty property and casualty insurance products in the United States. It underwrites casualty insurance solutions for risks in the construction, distribution, heavy manufacturing, real estate, and hospitality segments; professional liability insurance solutions for financial institutions, private and public directors and officers liability insurance, errors and omissions liability insurance, and cyber segments; and healthcare solutions for hospitals, senior care providers, managed care organizations, miscellaneous medical facilities, and healthcare management liability segments. The company distributes its products through distribution partners in wholesale and retail markets. Bowhead Specialty Holdings Inc. was formerly known as Bowhead Holdings Inc. and changed its name to Bowhead Specialty Holdings Inc. in March 2024. The company was founded in 2020 and is based in New York, New York. Bowhead Specialty Holdings Inc. operates as a subsidiary of Bowhead Insurance Holdings LP.