Kinsale Capital is Monday's IBD Stock Of The Day, as the leading insurance stock is pulling back to a key level of support, hovering just below a buy point. KNSL edged higher Monday.
Virginia-based Kinsale Capital provides various casualty, property and professional lines, and transportation insurance products focusing on the excess and surplus lines market in the U.S. The company's casualty insurance covers everything from cannabis to construction industries.
Meanwhile, the specialty casualty unit handles energy, entertainment, environmental and life sciences industries along with product recall and product liability. Kinsale Capital also has health care exposure. Its professional lines oversee health and public entities and professional liability coverage. The company's transportation unit insures aviation, auto and marine businesses.
On April 27, Kinsale Capital topped first-quarter estimates, with earnings jumping 50% to $2.44 and total revenues of $257 million, up 43% vs. a year ago. Analysts project full-year 2023 profits growing 32% to $10.30 per share, according to FactSet.
A strong piece of that beat was capital investment income, which surged 128% for the quarter, to $20.7 million vs. last year. The insurance firm reported that growth was driven by strong operating cash flows and higher interest rates.
In early May, the Federal Reserve increased interest rates by 0.25 percentage points, the central bank's 10th hike in 14 months. That pushed its benchmark rate to between 5% and 5.25%, up from near zero in March 2022 and near its highest level in 16 years.
The company added that total investments grew 11% to $2.25 billion in Q1 vs the end of 2022. Cash and cash equivalents rose less than 2%, to $156.6 million. Meanwhile, the insurance firm's reported debt stood at $195.8 million, vs. $195.7 million a year ago.
Kinsale Capital Stock
KNSL edged up 0.9% to 324.03 during Monday's market trade amid higher-than-average volume. Kinsale Capital stock is pulling back to near its 50-day moving average and has formed a cup base with a 337.22 buy point, according to MarketSmith.
KNSL is currently around 6% below that entry. Kinsale Capital stock initially topped that buy point on April 24, but has generally traded just below that key level.
KNSL stock is on the IBD Long-Term Leaders list. Kinsale Capital stock ranks first in IBD's Insurance-Property/Casualty/Title industry group. Additionally, KNSL has a 99 Composite Rating out of 99. Shares also have an 89 Relative Strength Rating. The EPS Rating for Kinsale Capital stock is 99 out of 99.
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