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Kinsale Capital (KNSL) Q3 Earnings & Revenues Beat, Rise Y/Y

·3 min read

Kinsale Capital Group, Inc. KNSL delivered third-quarter 2021 net operating earnings of $1.59 per share, which outpaced the Zacks Consensus Estimate by 57.4%. The bottom line improved nearly four-fold year over year.

The company’s results benefited from rate increase, focus on disciplined underwriting and cost management.

Kinsale Capital Group, Inc. Price, Consensus and EPS Surprise

Kinsale Capital Group, Inc. Price, Consensus and EPS Surprise
Kinsale Capital Group, Inc. Price, Consensus and EPS Surprise

Kinsale Capital Group, Inc. price-consensus-eps-surprise-chart | Kinsale Capital Group, Inc. Quote

Operational Update

Total revenues in the third quarter rose 42.5% year over year to $165 million. The growth can primarily be attributed to a rise in premiums and higher net investment income. The top line surpassed the Zacks Consensus Estimate of $154 million.

Gross written premiums of $197.6 million rose 36.5% year over year, driven by higher submission activity from brokers and rate increases on bound accounts. Net written premiums climbed 39.6% year over year to $170.7 million in the quarter.

Net investment income advanced 15.5% year over year to $8.1 million in the quarter. The upside came on the back of growth in the investment portfolio.

In the third quarter, the company’s total expenses increased 12.1% year over year to $119.2 million due to a rise in losses and loss adjustment expenses, underwriting, acquisition and insurance expenses.

Kinsale Capital reported an underwriting income of $38.1 million, which soared more than 13-fold over year, largely on premium growth and continued rate increases due to a strong underwriting environment, lower catastrophe activity and higher net favorable development of loss reserves from prior accident years. Combined ratio improved 2160 basis points (bps) to 75.7 in the quarter under review.

While expense ratio improved 120 bps to 20 in the third quarter, loss ratio improved 2040 bps to 57.5.

Financial Update

Kinsale Capital exited the third quarter with cash and cash equivalents of $90 million, which increased 16.8% from the 2020-end level. As of Sep 30, 2021, credit facility was $42.6 million, up 0.1% from the level at 2020 end.

As of Sep 30, 2021, stockholders’ equity grew 30.1% to $644.1 million from the 2020-end level.

Annualized operating return on equity expanded 1500 bps year over year to 22.8% in the quarter under review.

Zacks Rank

Kinsale Capital currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Insurers

Among other insurers that have already reported their third-quarter results, the bottom line at The Travelers Companies TRV and RLI Corp. RLI beat the respective Zacks Consensus Estimate while that of The Progressive Corporation PGR missed expectation.

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RLI Corp. (RLI) : Free Stock Analysis Report

The Travelers Companies, Inc. (TRV) : Free Stock Analysis Report

The Progressive Corporation (PGR) : Free Stock Analysis Report

Kinsale Capital Group, Inc. (KNSL) : Free Stock Analysis Report

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