leading insurance stocks Kinsale Capital Group KNSL formed a new base and secured a place in the IBD Breakout Stocks Index. She is in good company.
KNSL stock joins the basket of stocks recently added to the index, which is tracked by the IBD Breakout Opportunities ETF (BOUT).
Other defensive names added to the list include food giants Conagra Brands (CAG) f Campbell’s soup (CPB).
Medical industry stocks Intracellular therapies (ITCI), Merit Medical Systems (MMSI) f Arraya group (ENSG) also on the list.
Finally, the energy industry is highly represented with giants Exxon Mobil (XOM), BP (BP), Danbury (Den) f coincidence (Shell).
The property and loss moving company assumes many risks
Kinsale Capital provides casualty, specialty, property, professional lines and transportation insurance products. Its accident insurance covers everything from cannabis to the construction industries.
The specialist casualty handles the energy, entertainment, environment, life sciences, product recovery and product liability industries.
Its professional lines oversee health, general and professional liability coverage entities while its transportation unit underwrites the aviation, automotive and marine businesses.
KNSL shares are ranked 1st out of 62 components in the insurance and property/casualty/title group, which ranks 106th out of 197 IBD industry groups.
Insurance stock builds another base
The insurance stock forms a cup bottom with 337.22 buy points emerging from cup bottom handle by handle.
The rule began after Kinsale reported better-than-expected fourth-quarter earnings and sales on Feb. 16. The insurance stock rose 14.5% on heavy volumes the next day.
But then KNSL traded choppily and flipped, falling through its 50-day moving average.
The stock regained the 50-day streak in March and has been steadily climbing the right side of the base of the cup since that time. The shares are about 7% from the point of purchase.
Strong growth in insurance company earnings
The insurance stock posted respectable earnings of 48% and sales growth of 32% in the fourth quarter, continuing a history of strong performance.
FactSet estimates earnings of $2.20 per share in the first quarter of 2023, which represents 35% year-over-year growth. Earnings per share for the full year are expected to grow approximately 24% to $9.66 in 2023 and approximately 20% in 2024 to $11.55.
Gross premiums for the fourth quarter grew 45% to $295.5 million. FactSet expects premiums of $304.3 million in the first quarter.
Gross premiums for the full year 2022 increased 44% to $1.1 billion, with $1.338 billion expected in 2023.
Return on equity grew to 25%, from 20.8% in 2021. The CAN SLIM investment strategy looks for companies with a minimum return on equity of 17%, the higher the better.
Kinsale reports first-quarter earnings on April 27th.
The insurance stock carries an impressive 97 out of 99 EPS rating and a healthy stability rating of 9. The IBD Stability rating measures 3 to 5 years of earnings history on a scale of 1 to 99, with 1 being the best. The lower the number, the more stable the rate of earnings.
ETF IBD Breakout Opportunities
The IBD Breakout Opportunities ETF from Innovator Capital Management tracks the IBD Breakout Stocks Index. As with other ETFs, this fund allows you to invest in the entire index in addition to or instead of buying individual stocks. Learn more here about ETFs and Innovator.
Follow Kimberley Koenig for more stock news on Twitter @employee.
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