Kinsale Capital Group (NASDAQ:KNSL) and Kingsway Financial Services (NYSE:KFS) are both small-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, earnings, dividends and analyst recommendations.

Insider and Institutional Ownership

83.7% of Kinsale Capital Group shares are held by institutional investors. Comparatively, 25.3% of Kingsway Financial Services shares are held by institutional investors. 8.3% of Kinsale Capital Group shares are held by company insiders. Comparatively, 49.0% of Kingsway Financial Services shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Kinsale Capital Group and Kingsway Financial Services, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kinsale Capital Group 0 0 3 0 3.00
Kingsway Financial Services 0 0 0 0 N/A

Kinsale Capital Group currently has a consensus target price of $79.50, indicating a potential downside of 6.49%. Given Kinsale Capital Group’s higher possible upside, research analysts plainly believe Kinsale Capital Group is more favorable than Kingsway Financial Services.

Dividends

Kinsale Capital Group pays an annual dividend of $0.32 per share and has a dividend yield of 0.4%. Kingsway Financial Services does not pay a dividend. Kinsale Capital Group pays out 17.9% of its earnings in the form of a dividend.

Profitability

This table compares Kinsale Capital Group and Kingsway Financial Services’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kinsale Capital Group 18.52% 16.77% 5.68%
Kingsway Financial Services -30.73% -57.59% -4.04%

Risk and Volatility

Kinsale Capital Group has a beta of 0.85, indicating that its share price is 15% less volatile than the S&P 500. Comparatively, Kingsway Financial Services has a beta of -0.12, indicating that its share price is 112% less volatile than the S&P 500.

Valuation and Earnings

This table compares Kinsale Capital Group and Kingsway Financial Services’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Kinsale Capital Group $222.11 million 8.15 $33.79 million $1.79 47.50
Kingsway Financial Services $52.64 million 1.19 -$26.68 million N/A N/A

Kinsale Capital Group has higher revenue and earnings than Kingsway Financial Services.

Summary

Kinsale Capital Group beats Kingsway Financial Services on 11 of the 13 factors compared between the two stocks.

Kinsale Capital Group Company Profile

Kinsale Capital Group, Inc. provides as a casualty and property insurance products in the United States. Its commercial lines offerings include construction, small business, energy, excess and general casualty, life sciences, allied health, health care, commercial property, environmental, public entity, inland marine, and commercial insurance, as well as product, professional, and management liability insurance; and homeowners insurance. The company markets and sells insurance products through a network of independent insurance brokers. Kinsale Capital Group, Inc. was founded in 2009 and is headquartered in Richmond, Virginia.

Kingsway Financial Services Company Profile

Kingsway Financial Services Inc., through its subsidiaries, provides property and casualty insurance products in the United States. The company operates through three segments: Insurance Underwriting, Extended Warranty, and Leased Real Estate. The Insurance Underwriting segment offers various automobile insurance products, including liability insurance that covers claims against its insured's responsible for automobile accidents; accident benefit policies or personal injury protection policies that provide coverage for loss of income, medical, and rehabilitation expenses for insured persons who are injured in an automobile accident; and physical damage policies, which cover damages to an insured automobile arising from a collision with another object, as well as from other risks, such as fire or theft. The Extended Warranty segment markets and administers vehicle service agreements and related products for new and used automobiles. This segment also markets and distributes warranty products to manufacturers, distributors, and installers of heating, ventilation and air conditioning, standby generator, commercial LED lighting, and refrigeration equipment; and equipment breakdown and maintenance support services to companies. The Leased Real Estate segment owns the Real Property, which is subject to a long-term triple net lease agreement. The company offers its products and services to credit unions, consumers, and businesses through a network of independent agencies. Kingsway Financial Services Inc. was founded in 1989 and is based in Itasca, Illinois.

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