Kestrel Group stock falls after first-quarter loss widens

5 articles · Updated · MarketWatch · May 8

Shares dropped to $10.98 in after-hours trading after the specialty insurer posted a $7.4 million loss, or 96 cents a share, versus $394,000, or 14 cents, a year earlier.
Revenue rose to $10.2 million from $841,000, while gross premiums written were $2.7 million and net premiums earned reached $3.2 million.
Chief executive Luke Ledbetter said program services maintained momentum, with fee revenue and premiums produced rising materially year on year; despite Friday's drop, the stock had gained 16% this year by the close.

As the specialty market softens, can Kestrel’s fee-based model outrun the industry-wide threat of 'social inflation'?

Kestrel’s stock now trades far below its book value. Is this a massive market misjudgment or a classic value trap?