With a price-to-earnings (or "P/E") ratio of 30.3x Kinsale Capital Group, Inc. (NYSE:KNSL) may be sending very bearish signals at the moment, given that almost half of all companies in the United States have P/E ratios under 17x and even P/E's lower than 10x are not unusual. However, the P/E might be quite high for a reason and it requires further investigation to determine if it's justified.
Recent times have been pleasing for Kinsale Capital Group as its earnings have risen in spite of the market's earnings going into reverse. The P/E is probably high because investors think the company will continue to navigate the broader market headwinds better than most. If not, then existing shareholders might be a little nervous about the viability of the share price.
NYSE:KNSL Price to Earnings Ratio vs Industry August 16th 2024 Want the full picture on analyst estimates for the company? Then our free report on Kinsale Capital Group will help you uncover what's on the horizon.
What Are Growth Metrics Telling Us About The High P/E?
In order to justify its P/E ratio, Kinsale Capital Group would need to produce outstanding growth well in excess of the market.
Taking a look back first, we see that the company grew earnings per share by an impressive 61% last year. The strong recent performance means it was also able to grow EPS by 198% in total over the last three years. So we can start by confirming that the company has done a great job of growing earnings over that time.
Looking ahead now, EPS is anticipated to climb by 9.1% each year during the coming three years according to the nine analysts following the company. That's shaping up to be similar to the 10% each year growth forecast for the broader market.
With this information, we find it interesting that Kinsale Capital Group is trading at a high P/E compared to the market. Apparently many investors in the company are more bullish than analysts indicate and aren't willing to let go of their stock right now. These shareholders may be setting themselves up for disappointment if the P/E falls to levels more in line with the growth outlook.
What We Can Learn From Kinsale Capital Group's P/E?
We'd say the price-to-earnings ratio's power isn't primarily as a valuation instrument but rather to gauge current investor sentiment and future expectations.
Our examination of Kinsale Capital Group's analyst forecasts revealed that its market-matching earnings outlook isn't impacting its high P/E as much as we would have predicted. Right now we are uncomfortable with the relatively high share price as the predicted future earnings aren't likely to support such positive sentiment for long. This places shareholders' investments at risk and potential investors in danger of paying an unnecessary premium.
You always need to take note of risks, for example - Kinsale Capital Group has 1 warning sign we think you should be aware of.
You might be able to find a better investment than Kinsale Capital Group. If you want a selection of possible candidates, check out this free list of interesting companies that trade on a low P/E (but have proven they can grow earnings).
Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Kinsale Capital GroupのP/E比率が30.3倍で、米国のほとんどの企業のP/E比率が17倍未満であり、10倍未満のP/Eも珍しくないことを考えると、今のところ非常に弱気なシグナルを発している可能性があります。しかし、P/Eがかなり高い理由があるのかどうか判断するには、さらなる調査が必要かもしれません。
最近の動向は、市場の収益が逆転したにもかかわらず、Kinsale Capital Groupの収益が上昇しているため喜ばしいものでした。P/E比率が高いのは、投資家がこの企業が他よりも市場の不利な状況を乗り切ると思っているからだと考えられます。そうでなければ、既存の株主は株価の持続可能性に少し不安を感じるかもしれません。
NYSE:KNSL株価 / 収益率比率と業種 業績推移(2024年8月16日) 会社のアナリスト評価についての詳細な情報が欲しいですか? その場合、当社の無料レポート『Kinsale Capital Group』をご覧いただくと、将来予想されることがわかります。
高いP/E比率から成長メトリックスがどのような示唆を与えているのか?
Kinsale Capital GroupのP/E比率を正当化するには、市場を大幅に上回る優れた成長を生み出す必要があります。
この情報から、Kinsale Capital Groupが市場に比べて高いP/Eで取引されていることが興味深いと言えます。多くの投資家がアナリストの指摘よりも強気なので、この企業の株式を手放すつもりがないということのようです。これらの株主は、将来の成長見通しに応じたレベルにP/Eが落ち込めば、失望することになる可能性があります。
Kinsale Capital Groupのアナリスト予測を調べたところ、市場に合わせた収益見通しにもかかわらず、高いP/E比率には影響を与えていないことがわかりました。現時点では、将来予想される収益が長くポジティブなセンチメントを支持しないことに、比較的高い株価に不安を感じています。これにより株主の投資がリスクにさらされ、潜在的な投資家が不必要なプレミアムを支払う危険性があります。
いつもリスクに注意する必要があります。たとえば、Kinsale Capital Groupには1つの警告サインがあります。
Kinsale Capital Groupより良い投資先を見つけることができるかもしれません。低P/Eで取引される興味深い企業の無料リストをご覧いただくと、可能性のある候補の選択肢を見つけることができます。
オーストラリアでは、moomooの投資商品及びサービスはMoomoo Securities Australia Limitedによって提供され、オーストラリア証券投資委員会(ASIC)の管理を受けております(AFSL No. 224663)。「金融サービスガイド」、「利用規約」、「プライバシーポリシー」などの詳細は、Moomoo Securities Australia Limitedのウェブサイトhttps://www.moomoo.com/auでご確認いただけます。
オーストラリアでは、moomooの投資商品及びサービスはMoomoo Securities Australia Limitedによって提供され、オーストラリア証券投資委員会(ASIC)の管理を受けております(AFSL No. 224663)。「金融サービスガイド」、「利用規約」、「プライバシーポリシー」などの詳細は、Moomoo Securities Australia Limitedのウェブサイトhttps://www.moomoo.com/auでご確認いただけます。