Results: Kinsale Capital Group, Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts

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 full-year 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. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Kinsale Capital Group

Following the latest results, Kinsale Capital Group's eight analysts are now forecasting revenues of US$1.56b in 2024. This would be a major 28% improvement in revenue compared to the last 12 months. Per-share earnings are expected to expand 11% to US$14.82. Before this earnings report, the analysts had been forecasting revenues of US$1.54b and earnings per share (EPS) of US$14.31 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 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. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Of course, another way to look at these forecasts is to place them into context against the industry itself. 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 although Kinsale Capital Group is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider 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. Happily, there were no major changes to revenue forecasts, with the business still 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 in mind, we wouldn't be too quick to come to a conclusion on Kinsale Capital Group. Long-term earnings power is much more important than next year's profits. We have forecasts 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.