The company is a specialist insurer and reinsurer and provides bespoke, specialty, and property insurance coverage services. Fidelis is also backed with long-standing industry relationships and more than 30 years of underwriting, risk management, claims, and actuarial knowledge.
Analysts suggest a positive outlook for the IPO, recommending a Buy rating for the shares at a maximum price of $17.50 per share.
Fidelis Insurance Holdings was founded with the goal of generating returns in cyclical reinsurance environments. Led by Chairman and CEO Richard Brindle, who has extensive underwriting experience, the company offers a range of insurance products, including bespoke insurance, specialty lines, and property reinsurance.
The IPO is expected to raise approximately $298 million, with FIHL selling 5.7 million shares of common stock and existing shareholders offering 11.3 million shares. The proposed midpoint price for the shares is $17.50, resulting in an enterprise value of around $1.8 billion.
Fidelis Insurance has experienced impressive growth in gross premiums, writing $3.0 billion in premiums in 2022, representing a compound annual growth rate of 46.0% since its establishment in 2015. The company believes that the insurance industry is poised for further value disaggregation, favoring specialized underwriters with access to clients and alternative sources of capital.
In terms of market competition, Fidelis operates in the specialty insurance, bespoke, and property reinsurance markets. Major players in the industry include Arch, Argo, Aspen, Markel, W. R. Berkley, Hiscox, Beazley, Lancashire, Everest Re, Axis Capital, Renaissance Re, and others.
Financially, Fidelis Insurance Holdings has demonstrated strong performance, with growing top-line revenue and increasing income before taxes. However, cash flow from operations experienced a sharp decrease in the first quarter of 2023. As of March 31, 2023, the company had $3.3 billion in cash, equivalents, securities, and investments, with total liabilities of $7.5 billion.
The IPO is set to take place on June 28, 2023, with JPMorgan, Barclays, Jefferies, and other investment banks acting as the underwriters. Investors are advised to consider the company’s financials, valuation metrics, and industry dynamics when making investment decisions.
