My four year old looked like this. I posted online a question about it, and here's what I was told:
Hello, I have a 2 1/2 week old colt. Yesterday I noticed his naval stump is protruding along with a "pouch" type of skin sagging. I had not noticed this before, nor is it really visible in my video taken when he was six days old. I was able to touch it, and the stump seems to be hard. The surrounding skin is soft, but not swollen. There isn't any leakage, and he didn't seem uncomfortable with me touching the area. It appears to be healing nicely. Will this eventually go away or always protrude? It looks like an "outie" naval. How to you tell if there is a hernia? I cannot stick a finger anywhere. There is no "hole". More like a slight pouch.
Answer: Your description does not sound like a hernia Melanie, at least not one a complete hernia large enough to fit a finger in. However partial hernias that do not go all the way into the abdominal cavity are possible. If there is no hernia nor abnormal tissue, this will go away. But these are assessments that will require professional examination familiar with the possible underlying structures.
I don't have the pics, but it looked like yours. It completely went away, but I can't remember how long it took. I think it will be fine. :)