In This Article:
A week ago, Kinsale Capital Group, Inc. (NYSE:KNSL) came out with a strong set of second-quarter numbers that could potentially lead to a re-rate of the stock. Kinsale Capital Group beat earnings, with revenues hitting US$385m, ahead of expectations, and statutory earnings per share outperforming analyst reckonings by a solid 12%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Kinsale Capital Group
Taking into account the latest results, the consensus forecast from Kinsale Capital Group's ten analysts is for revenues of US$1.58b in 2024. This reflects a solid 11% improvement in revenue compared to the last 12 months. Statutory per share are forecast to be US$16.01, approximately in line with the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of US$1.55b and earnings per share (EPS) of US$15.54 in 2024. So the consensus seems to have become somewhat more optimistic on Kinsale Capital Group's earnings potential following these results.
The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 5.8% to US$443. 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. The most optimistic Kinsale Capital Group analyst has a price target of US$514 per share, while the most pessimistic values it at US$403. This is a very narrow spread of estimates, implying either that Kinsale Capital Group is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Kinsale Capital Group's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 23% growth on an annualised basis. This is compared to a historical growth rate of 32% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.1% annually. Even after the forecast slowdown in growth, it seems obvious that Kinsale Capital Group is also expected to grow faster than the wider industry.