Industry Analysts Just Upgraded Their Kingstone Companies, Inc. (NASDAQ:KINS) Revenue Forecasts By 14%

Shareholders in Kingstone Companies, Inc. (NASDAQ:KINS) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects. The stock price has risen 8.5% to US$8.02 over the past week, suggesting investors are becoming more optimistic. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

After this upgrade, Kingstone Companies' two analysts are now forecasting revenues of US$143m in 2021. This would be an okay 7.3% improvement in sales compared to the last 12 months. The losses are expected to disappear over the next year or so, with forecasts for a profit of US$0.50 per share next year. Before this latest update, the analysts had been forecasting revenues of US$126m and earnings per share (EPS) of US$0.47 in 2021. Sentiment certainly seems to have improved in recent times, with a substantial gain in revenue and a small lift in earnings per share estimates.

View our latest analysis for Kingstone Companies

With these upgrades, we're not surprised to see that the analysts have lifted their price target 15% to US$9.50 per share. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Kingstone Companies analyst has a price target of US$9.00 per share, while the most pessimistic values it at US$8.00. Still, with such a tight range of estimates, it suggests the analysts have a pretty good idea of what they think the company is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Kingstone Companies' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Kingstone Companies' revenue growth will slow down substantially, with revenues to the end of 2021 expected to display 5.8% growth on an annualised basis. This is compared to a historical growth rate of 18% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 2.9% per year. Even after the forecast slowdown in growth, it seems obvious that Kingstone Companies is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for next year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Seeing the dramatic upgrade to next year's forecasts, it might be time to take another look at Kingstone Companies.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for Kingstone Companies going out as far as 2022, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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This article by Simply Wall St is general in nature. 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.
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