Kingstone(KINS) ZACKS·2025-01-03 18:16Core Insights - Kingstone Companies (KINS) is currently trading above its 50-day simple moving average, indicating a short-term bullish trend, with a share price of 18.08 [1][8] - KINS was the 15th largest homeowner insurer in New York in 2023, holding a market share of 1.6%, and is positioned to benefit from a 200 million market opportunity as competitors exit the personal property market in July 2024 [2] - KINS has outperformed the industry, sector, and S&P 500 over the past year, with a share price increase of 612.3% compared to the industry's 23.2% and the S&P 500's 26.1% [4][5] Financial Performance - The Zacks Consensus Estimate for KINS's 2025 earnings has increased by 25% in the past 60 days, suggesting a 10.7% year-over-year increase with revenues projected to rise by 22.8% to 192.1 million [9][10] - KINS expects earnings per share for 2025 to be between 2.00 [11] - The company has a Growth Score of A, indicating strong growth potential [10] Growth Strategy - KINS is focusing on its core business while scaling back on unprofitable non-core operations, which positions it well for future growth [12] - The company has successfully implemented price increases ahead of inflation and enhanced its pricing capabilities through a partnership with Earnix, expecting direct written premium growth of 15% to 25% in 2025 [13] - KINS aims to lower its net expense ratio to below 31% in 2024 by driving higher average premiums and reducing commissions and staffing [14] Profitability Metrics - KINS's return on equity (ROE) for the trailing 12 months was 32.6%, significantly higher than the industry average of 7.6% [15] - The company expects ROE to be between 32% and 36% in 2024 and between 24% and 32% in 2025 [16] - KINS's return on invested capital (ROIC) was 27%, also above the industry average, reflecting efficient fund utilization [17] Valuation - KINS's stock is currently considered overvalued, trading at a price-to-book multiple of 2.79 compared to the industry average of 1.53 [19] - Despite its expensive valuation, KINS is viewed positively due to strong analyst sentiment and growth prospects, with a target price of $17 indicating an 11.9% upside potential [22][24]