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Kinsale Q3 Earnings & Revenues Top Estimates, Premiums Rise Y/Y
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Kinsale Capital Group (KNSL - Free Report) delivered third-quarter 2024 net operating earnings of $4.20 per share, which outpaced the Zacks Consensus Estimate by 13.5%. The bottom line increased 26.9% year over year.
The results reflect the continued execution of its strategy of disciplined underwriting and technology-enabled low costs.
Shares gained 2.3% in the after-market trading session to reflect the outperformance.
Kinsale Capital Group, Inc. Price, Consensus and EPS Surprise
Operating revenues jumped 33.1% year over year to $418 million. The growth can primarily be attributed to a rise in premiums, fee income, higher net investment income and other income. Revenues beat the consensus estimate by 4.2%.
Gross written premiums of $448.6 million rose 18.8% year over year, driven by strong submission flow from brokers and a favorable, yet increasingly competitive, pricing environment. Our estimate was $475.1 million.
Net written premiums climbed 18.9% year over year to $349.9 million in the quarter. Our estimate was pegged at $370.2 million.
Net investment income increased 46.4% year over year to $39.6 million in the quarter and beat our estimate of $38.6 million. The year-over-year increase was driven by growth in the investment portfolio generated primarily from the investment of strong operating cash flows and higher interest rates. The Zacks Consensus Estimate was pegged at $37.7 million.
Total expenses increased 25% year over year to $273.7.7 million due to a rise in losses and loss adjustment expenses, underwriting, acquisition and insurance expenses and other expense. Our estimate was pegged at $285 million.
Kinsale Capital’s underwriting income was $86.9 million, which grew 20% year over year. The increase was due to a combination of premium growth and lower relative net commissions offset in part by higher catastrophe losses. Our estimate was $64.6 million. The combined ratio deteriorated 90 basis points (bps) to 75.7 in the quarter under review. The Zacks Consensus Estimate was 79. Our estimate was 79.4.
The expense ratio deteriorated 130 bps to 19.6 in the quarter. Our estimate was 21.4, while the Zacks Consensus Estimate was 20.9.
The loss ratio improved 220 bps to 56.1. Our estimate for loss ratio was 58.1, while the Zacks Consensus Estimate was 58.
Financial Update
Kinsale Capital exited the third quarter of 2024 with cash and cash equivalents of $111.7 million, which decreased 11.8% from the 2023-end level.
As of Sept. 30, 2024, stockholders’ equity increased 27.3% to $1.4 billion from the 2023-end level. Book value per share was $61.62 as of Sept. 30, 2024, up 31.4% from the 2023 end level.
Net operating cash flows were $763.3 million in the first nine months of 2024, up 17.7% year over year.
Annualized operating return on equity contracted 530 bps year over year to 29.1% in the reported quarter.
Share Repurchase
In October 2024, the board of directors authorized a share repurchase program authorizing the repurchase of up to $100.0 million of the common stock.
The Travelers Companies (TRV - Free Report) reported third-quarter 2024 core income of $5.24 per share, which beat the Zacks Consensus Estimate by 38.2%. Total revenues increased 10.7% from the year-ago quarter to $11.84 billion, primarily driven by higher premiums, net investment income, fee income and other revenues. The top-line figure beat the Zacks Consensus Estimate by 1.4%.
Travelers’ net written premiums increased 8% year over year to a record $11.31 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $10.5 billion. Travelers witnessed an underwriting gain of $685 million against a loss of $136 million incurred in the year-ago quarter. The consolidated underlying combined ratio of 85.6 improved 500 bps year over year. The combined ratio improved 780 bps year over year to 93.2 due to an improvement in the underlying combined ratio and net favorable prior-year reserve development.
The Progressive Corporation’s (PGR - Free Report) third-quarter 2024 earnings per share of $3.97 beat the Zacks Consensus Estimate of $3.40. The bottom line more than doubled year over year. Operating revenues of $19.5 billion improved 24.9% year over year and beat the consensus estimate by 2.6%.
Net premiums written were $19.5 billion in the quarter, up 25% from $15.6 billion a year ago. Combined ratio — the percentage of premiums paid out as claims and expenses — improved 340 bps from the prior-year quarter’s level to 89.
RLI Corp. (RLI - Free Report) reported third-quarter 2024 operating earnings of $1.31 per share, beating the Zacks Consensus Estimate by 33.7%. The bottom line more than doubled year over year. Operating revenues for the reported quarter were $426 million, up 1.4% year over year. The top line beat the Zacks Consensus Estimate of $420 million.
Gross premiums written increased 13% year over year to $563.4 million. This uptick can be attributed to the solid performance of the Casualty (up 15.7%), Property (up 9.6%) and Surety segments (up 9%). Our estimate was $572.3 million. Underwriting income increased to $40.7 million from $4.2 million in the year-ago quarter. The combined ratio improved 910 bps year over year to 89.6. The Zacks Consensus Estimate for the metric was pegged at 96, while our estimate was 103.1.
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Kinsale Q3 Earnings & Revenues Top Estimates, Premiums Rise Y/Y
Kinsale Capital Group (KNSL - Free Report) delivered third-quarter 2024 net operating earnings of $4.20 per share, which outpaced the Zacks Consensus Estimate by 13.5%. The bottom line increased 26.9% year over year.
The results reflect the continued execution of its strategy of disciplined underwriting and technology-enabled low costs.
Shares gained 2.3% in the after-market trading session to reflect the outperformance.
Kinsale Capital Group, Inc. Price, Consensus and EPS Surprise
Kinsale Capital Group, Inc. price-consensus-eps-surprise-chart | Kinsale Capital Group, Inc. Quote
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Operational Update
Operating revenues jumped 33.1% year over year to $418 million. The growth can primarily be attributed to a rise in premiums, fee income, higher net investment income and other income. Revenues beat the consensus estimate by 4.2%.
Gross written premiums of $448.6 million rose 18.8% year over year, driven by strong submission flow from brokers and a favorable, yet increasingly competitive, pricing environment. Our estimate was $475.1 million.
Net written premiums climbed 18.9% year over year to $349.9 million in the quarter. Our estimate was pegged at $370.2 million.
Net investment income increased 46.4% year over year to $39.6 million in the quarter and beat our estimate of $38.6 million. The year-over-year increase was driven by growth in the investment portfolio generated primarily from the investment of strong operating cash flows and higher interest rates. The Zacks Consensus Estimate was pegged at $37.7 million.
Total expenses increased 25% year over year to $273.7.7 million due to a rise in losses and loss adjustment expenses, underwriting, acquisition and insurance expenses and other expense. Our estimate was pegged at $285 million.
Kinsale Capital’s underwriting income was $86.9 million, which grew 20% year over year. The increase was due to a combination of premium growth and lower relative net commissions offset in part by higher catastrophe losses. Our estimate was $64.6 million. The combined ratio deteriorated 90 basis points (bps) to 75.7 in the quarter under review. The Zacks Consensus Estimate was 79. Our estimate was 79.4.
The expense ratio deteriorated 130 bps to 19.6 in the quarter. Our estimate was 21.4, while the Zacks Consensus Estimate was 20.9.
The loss ratio improved 220 bps to 56.1. Our estimate for loss ratio was 58.1, while the Zacks Consensus Estimate was 58.
Financial Update
Kinsale Capital exited the third quarter of 2024 with cash and cash equivalents of $111.7 million, which decreased 11.8% from the 2023-end level.
As of Sept. 30, 2024, stockholders’ equity increased 27.3% to $1.4 billion from the 2023-end level. Book value per share was $61.62 as of Sept. 30, 2024, up 31.4% from the 2023 end level.
Net operating cash flows were $763.3 million in the first nine months of 2024, up 17.7% year over year.
Annualized operating return on equity contracted 530 bps year over year to 29.1% in the reported quarter.
Share Repurchase
In October 2024, the board of directors authorized a share repurchase program authorizing the repurchase of up to $100.0 million of the common stock.
Zacks Rank
Kinsale Capital currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
The Travelers Companies (TRV - Free Report) reported third-quarter 2024 core income of $5.24 per share, which beat the Zacks Consensus Estimate by 38.2%. Total revenues increased 10.7% from the year-ago quarter to $11.84 billion, primarily driven by higher premiums, net investment income, fee income and other revenues. The top-line figure beat the Zacks Consensus Estimate by 1.4%.
Travelers’ net written premiums increased 8% year over year to a record $11.31 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $10.5 billion. Travelers witnessed an underwriting gain of $685 million against a loss of $136 million incurred in the year-ago quarter. The consolidated underlying combined ratio of 85.6 improved 500 bps year over year. The combined ratio improved 780 bps year over year to 93.2 due to an improvement in the underlying combined ratio and net favorable prior-year reserve development.
The Progressive Corporation’s (PGR - Free Report) third-quarter 2024 earnings per share of $3.97 beat the Zacks Consensus Estimate of $3.40. The bottom line more than doubled year over year. Operating revenues of $19.5 billion improved 24.9% year over year and beat the consensus estimate by 2.6%.
Net premiums written were $19.5 billion in the quarter, up 25% from $15.6 billion a year ago. Combined ratio — the percentage of premiums paid out as claims and expenses — improved 340 bps from the prior-year quarter’s level to 89.
RLI Corp. (RLI - Free Report) reported third-quarter 2024 operating earnings of $1.31 per share, beating the Zacks Consensus Estimate by 33.7%. The bottom line more than doubled year over year. Operating revenues for the reported quarter were $426 million, up 1.4% year over year. The top line beat the Zacks Consensus Estimate of $420 million.
Gross premiums written increased 13% year over year to $563.4 million. This uptick can be attributed to the solid performance of the Casualty (up 15.7%), Property (up 9.6%) and Surety segments (up 9%). Our estimate was $572.3 million. Underwriting income increased to $40.7 million from $4.2 million in the year-ago quarter. The combined ratio improved 910 bps year over year to 89.6. The Zacks Consensus Estimate for the metric was pegged at 96, while our estimate was 103.1.