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Kinsale (KNSL) Up 28.9% in a Year: Can It Maintain the Upside?
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Shares of Kinsale Capital Group, Inc. (KNSL - Free Report) have gained 28.9% in a year, outperforming the industry's growth of 6.7%. The Zacks S&P 500 composite decreased 15.6% in the said time frame. With a market capitalization of $6.4 billion, the average volume of shares traded in the last three months was 0.2 million.
Image Source: Zacks Investment Research
The rally was largely driven by rate increases, higher premium growth rate and lower reinstatement premiums.
This Zacks Rank #1 (Strong Buy) insurer has a solid record of beating earnings estimates in each of the last seven quarters.
Can KNSL Stock Retain Its Momentum?
The Zacks Consensus Estimate for 2022 and 2023 earnings per share is pegged at $7.32 and $8.92, indicating year-over-year increases of 27.5% and 21.9%, respectively.
The company’s return on equity for the trailing 12 months is 24.6%, which expanded 540 basis points year over year and was better than the industry average of 6.7%, reflecting efficiency in utilizing shareholders’ fund.
Kinsale Capital’s premium income is expected to improve in the near term on the back of increasing submissions and rate increases.
The combination of highly controlled underwriting with advanced technology-driven low costs, and a focus on the Excess and Surplus Lines Insurance market is driving profitability and growth of Kinsale Capital.
The Excess and Surplus Lines insurance segment continues to witness rapid growth due to the dislocation in the overall property and casualty market.
The expense ratio is expected to gain from the lower reinstatement premiums on certain property reinsurance treaties that do not have ceding commissions, as well as lower other underwriting expenses due to higher net earned premiums.
Strong cash flows enable Kinsale Capital to engage in shareholder-friendly moves like dividend hikes. Net cash provided by operating activities more than doubled over the last two years.
Banking on its solid cash flow, KNSL has increased dividend since 2017, witnessing a five-year CAGR (2016-2022) of 14.6%.
Kinsale Capital has an impressive Growth Score of B. This style score helps analyze the growth prospects of a company. Back-tested results have shown that stocks with a favorable Growth Score, when combined with a solid Zacks Rank, offer better returns.
The Zacks Consensus Estimate for 2022 and 2023 has moved 5% and 5.9% north, respectively, in the past 60 days, reflecting analysts’ optimism.
MGIC Investment’s earnings surpassed estimates in each of the last four quarters, the average being 36.34%. In the past year, MGIC Investment has lost 6.7%.
The Zacks Consensus Estimate for MTG’s 2022 and 2023 earnings has moved 12.1% and 0.4% north, respectively, in the past 60 days.
Root delivered a trailing four-quarter average earnings surprise of 22.44%. In the past year, ROOT has lost 91.1%.
The Zacks Consensus Estimate for ROOT’s 2022 and 2023 earnings indicates year-over-year increases of 44.7% and 23.9%, respectively.
The bottom line of W.R. Berkley surpassed earnings estimates in each of the last four quarters, the average beat being 25.63%. In the past year, the insurer has gained 34.3%.
The Zacks Consensus Estimate for W.R. Berkley’s 2022 and 2023 earnings has moved 5.1% and 3.4% north, respectively, in the past 60 days.
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Kinsale (KNSL) Up 28.9% in a Year: Can It Maintain the Upside?
Shares of Kinsale Capital Group, Inc. (KNSL - Free Report) have gained 28.9% in a year, outperforming the industry's growth of 6.7%. The Zacks S&P 500 composite decreased 15.6% in the said time frame. With a market capitalization of $6.4 billion, the average volume of shares traded in the last three months was 0.2 million.
Image Source: Zacks Investment Research
The rally was largely driven by rate increases, higher premium growth rate and lower reinstatement premiums.
This Zacks Rank #1 (Strong Buy) insurer has a solid record of beating earnings estimates in each of the last seven quarters.
Can KNSL Stock Retain Its Momentum?
The Zacks Consensus Estimate for 2022 and 2023 earnings per share is pegged at $7.32 and $8.92, indicating year-over-year increases of 27.5% and 21.9%, respectively.
The company’s return on equity for the trailing 12 months is 24.6%, which expanded 540 basis points year over year and was better than the industry average of 6.7%, reflecting efficiency in utilizing shareholders’ fund.
Kinsale Capital’s premium income is expected to improve in the near term on the back of increasing submissions and rate increases.
The combination of highly controlled underwriting with advanced technology-driven low costs, and a focus on the Excess and Surplus Lines Insurance market is driving profitability and growth of Kinsale Capital.
The Excess and Surplus Lines insurance segment continues to witness rapid growth due to the dislocation in the overall property and casualty market.
The expense ratio is expected to gain from the lower reinstatement premiums on certain property reinsurance treaties that do not have ceding commissions, as well as lower other underwriting expenses due to higher net earned premiums.
Strong cash flows enable Kinsale Capital to engage in shareholder-friendly moves like dividend hikes. Net cash provided by operating activities more than doubled over the last two years.
Banking on its solid cash flow, KNSL has increased dividend since 2017, witnessing a five-year CAGR (2016-2022) of 14.6%.
Kinsale Capital has an impressive Growth Score of B. This style score helps analyze the growth prospects of a company. Back-tested results have shown that stocks with a favorable Growth Score, when combined with a solid Zacks Rank, offer better returns.
The Zacks Consensus Estimate for 2022 and 2023 has moved 5% and 5.9% north, respectively, in the past 60 days, reflecting analysts’ optimism.
Other Stocks to Consider
Some other top-ranked stocks from the insurance industry are MGIC Investment Corporation (MTG - Free Report) , Root, Inc. (ROOT - Free Report) and W.R. Berkley Corporation (WRB - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
MGIC Investment’s earnings surpassed estimates in each of the last four quarters, the average being 36.34%. In the past year, MGIC Investment has lost 6.7%.
The Zacks Consensus Estimate for MTG’s 2022 and 2023 earnings has moved 12.1% and 0.4% north, respectively, in the past 60 days.
Root delivered a trailing four-quarter average earnings surprise of 22.44%. In the past year, ROOT has lost 91.1%.
The Zacks Consensus Estimate for ROOT’s 2022 and 2023 earnings indicates year-over-year increases of 44.7% and 23.9%, respectively.
The bottom line of W.R. Berkley surpassed earnings estimates in each of the last four quarters, the average beat being 25.63%. In the past year, the insurer has gained 34.3%.
The Zacks Consensus Estimate for W.R. Berkley’s 2022 and 2023 earnings has moved 5.1% and 3.4% north, respectively, in the past 60 days.