Kinsale Capital Group (NASDAQ:KNSL) and Cincinnati Financial (NASDAQ:CINF) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, institutional ownership and earnings.
Insider and Institutional Ownership
86.8% of Kinsale Capital Group shares are owned by institutional investors. Comparatively, 62.7% of Cincinnati Financial shares are owned by institutional investors. 7.3% of Kinsale Capital Group shares are owned by insiders. Comparatively, 7.4% of Cincinnati Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Profitability
This table compares Kinsale Capital Group and Cincinnati Financial's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Kinsale Capital Group | 17.92% | 15.32% | 5.53% |
| Cincinnati Financial | 25.20% | 6.46% | 2.38% |
Valuation and Earnings
This table compares Kinsale Capital Group and Cincinnati Financial's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Kinsale Capital Group | $315.89 million | 14.49 | $63.32 million | $2.41 | 85.37 |
| Cincinnati Financial | $7.92 billion | 1.66 | $2.00 billion | $4.20 | 19.45 |
Cincinnati Financial has higher revenue and earnings than Kinsale Capital Group. Cincinnati Financial is trading at a lower price-to-earnings ratio than Kinsale Capital Group, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Kinsale Capital Group has a beta of 0.69, suggesting that its stock price is 31% less volatile than the S&P 500. Comparatively, Cincinnati Financial has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500.
Dividends
Kinsale Capital Group pays an annual dividend of $0.36 per share and has a dividend yield of 0.2%. Cincinnati Financial pays an annual dividend of $2.40 per share and has a dividend yield of 2.9%. Kinsale Capital Group pays out 14.9% of its earnings in the form of a dividend. Cincinnati Financial pays out 57.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Kinsale Capital Group has raised its dividend for 1 consecutive years and Cincinnati Financial has raised its dividend for 21 consecutive years. Cincinnati Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Recommendations
This is a breakdown of recent ratings and recommmendations for Kinsale Capital Group and Cincinnati Financial, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Kinsale Capital Group | 0 | 1 | 4 | 0 | 2.80 |
| Cincinnati Financial | 2 | 3 | 1 | 0 | 1.83 |
Kinsale Capital Group presently has a consensus price target of $139.00, suggesting a potential downside of 32.44%. Cincinnati Financial has a consensus price target of $76.7143, suggesting a potential downside of 6.07%. Given Cincinnati Financial's higher possible upside, analysts plainly believe Cincinnati Financial is more favorable than Kinsale Capital Group.
Summary
Kinsale Capital Group beats Cincinnati Financial on 9 of the 17 factors compared between the two stocks.
