The investors in Kinsale Capital Group, Inc.'s (NYSE:KNSL) will be rubbing their hands together with glee today, after the share price leapt 21% to US$505 in the week following its yearly results. The result was positive overall - although revenues of US$1.2b were in line with what the analysts predicted, Kinsale Capital Group surprised by delivering a statutory profit of US$13.22 per share, modestly greater than expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the most recent consensus for Kinsale Capital Group from eight analysts is for revenues of US$1.56b in 2024. If met, it would imply a major 28% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to step up 11% to US$14.82. In the lead-up to this report, the analysts had been modelling revenues of US$1.54b and earnings per share (EPS) of US$14.31 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 11% to US$454. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Kinsale Capital Group, with the most bullish analyst valuing it at US$607 and the most bearish at US$370 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Kinsale Capital Group shareholders.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We can infer from the latest estimates that forecasts expect a continuation of Kinsale Capital Group'shistorical trends, as the 28% annualised revenue growth to the end of 2024 is roughly in line with the 32% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 5.9% per year. So it's pretty clear that Kinsale Capital Group is forecast to grow substantially faster than its industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Kinsale Capital Group following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Kinsale Capital Group going out to 2026, and you can see them free on our platform here..
You can also see whether Kinsale Capital Group is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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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.
