Kingstone Companies Inc (KINS)

KINS 1 yr

https://www.americanbulls.com/SignalPage.aspx?lang=en&Ticker=KINS

KINS SINKs

Banner Q3 2015 for Kingstone! YoY direct written premiums up 22.1%, net income up 24.5%, earnings per share up 23.1%. Kingstone now an admitted carrier in 3 more states in addition to New York: Texas, Connecticut & New Jersey. Dividend raised 25% to $0.0625 per share.

Where else are you going to get this kind of growth in a stock paying a solid 2.5% dividend, and trading at a PE of only around 11?! All this in a company with no long term debt.

Looks like exciting times ahead for Kingstone shareholders. Excellent job by management and the crew.

Of course, maybe Amazon at a PE of 950, with no dividend and 40% debt/assets is a better choice. Lots of people seem to be buying it. Personally, my money is on KINS.

Thanks for your writeup. As hweb2 wrote, KINS has been spotlighted elsewhere here but this is a good reminder to take a look. Yes, low volume; also low shares outstanding (7M) and low float (5M).

Kind regards,
Minding

OT--funny you mention MLR. I bought some this week after their impressive earnings report. Listened to the CC, but not sure I understand why they're seeing such strong demand for their products in recent quarters?

Thanks for the info on the other boards, hweb2! I was unaware of them. Don't spend much time on IH, but I would be interested in seeing that kind of information. Will check it out when the dog and I return from adventuring out west in September.

And yes, I don't know what the market reaction will be even if KINS reports the type of good numbers I'm expecting. If results are decent, though, and management still gives conservative well-reasoned thoughts on why the company should continue to do well, I'm willing to just collect the dividend and wait. Maybe even go overweight and buy a bit more if it drops significantly.

MLR was in a similar position to KINS and recently reported about as I expected (maybe even a bit better), and the reaction was quite encouraging. I like that one too, but only had a 40% position on. Haven't bought more, as it gapped up right away. Don't like it as well as KINS right now, but there isn't much I can find to like at all in this current market, and MLR does seem to fit most of the parameters I look for.

Nice post! I'm with ya in thinking KINS should report a favorable comp next week. Market conditions have gotten pretty lousy lately...so not sure what the reaction will be. But KINS could be headed to double digits by yearend.

p.s. If you like profitable, low P/E microcaps...you're welcome to post your ideas on a board we have here on iHub. A great place to talk microcaps and also get new ideas:

http://investorshub.advfn.com/Value-Microcaps-Motherboard-3251/

We also have another board which is more trading oriented, so mostly value stuff but a little bit of everything. Search for KINS on both as it's been discussed a lot over the past year or so. Cheers!

http://investorshub.advfn.com/%22Savvy-Trades-and-Investments%E2%80%9D-26218/

Finished adding a full position (for me) in KINS today. Had to, because I'm pretty optimistic about the upcoming earnings report due out after the market closes on 8-12-15. Have an average price around $7.65 per share. Going on vacation next week and since this was Friday, it was my last chance to finish buying before earnings.

(Wish I'd been more nimble or had some low orders in place, on May 7th there was a flash crash in the stock down to $6.11. The stock was back above $7.00 before I even saw it. After it dropped so far in the blink of an eye, I wanted to buy below $7.00, but it never gave me the chance.)

Here's why I like KINS:

(1) Small cap - This little P&C insurance company has a market cap of only $56 million. The company operates in New York state in the USA. It's too small for the company to be fundamentally affected by most of the world's news flow. It doesn't really matter much to KINS if something bad happens in the Ukraine, China or Middle East.
(2) Low debt - KINS has no debt. The world is kind of a scary place these days. I like companies that are financially solid enough to survive a downturn, if one comes along. Low debt means the company is in a great position to hang in there when the going gets tough.
(3) Low PE and PEG. PE is only 10.45. 2015 Q1 direct written premiums were up 19.2% YoY. Net income was up 16.8% YoY. This was despite pretty bad weather in Q1 of 2015, when company had high claims due to frozen pipes and water damage.
(4) Decent & Growing Dividends - At today's (8-7-15) closing price of $7.64, the $0.05 quarterly dividend amounts to a 2.62% yield. Not really as much as I'd like. I prefer to see at least 3.00%. However, in Q3 of 2014 the company announced a 25% dividend increase from $0.04 per quarter to $0.05 per quarter. Since earnings have been strong in the past year, I suspect KINS will announce an increase to $0.06 in the 3rd Q of 2015. That would be a 20% increase and bring the yield up to 3.14%, which is acceptable. The dividend increase announcement could come as early as next Wednesday with the 2015 Q2 earnings report.
(5) Sustainable products - Tech kind of scares me. Today your company has the greatest electronic gadget or software ever. In 6 months it's old news and behind the competition's latest release. KINS is selling property & casualty insurance. Pretty likely they will still be selling it 6 months, 6 years and maybe even 6 decades from now. And it won't have to be 10 or 100 times better insurance for 1/10 of the price it was a few years back.
(6) Little government influence - Well OK, everything is affected by the colossus government, but I don't want to own target companies the politicians love to hate (and fine) like tobacco, asbestos, big banks, big oil, big coal, etc. Not wild about KINS operating in NY where the attorney general is just itching to make your company a scapegoat and level record setting fines, but the P&C insurance industry isn't a favorite target that I know of. KINS is too small too, to be of particular interest on the government's radar screen.
(7) Positive recent news - Earnings have been growing significantly the last 2 years from $0.20 in 2012, to $0.50 in 2013, to $0.72 in 2014. On 5-19-15, AM Best upgraded KINS' financial strength rating from B+ to B++. On 7-10-15, the company announced the signing of new reinsurance treaties, which should help earnings under most circumstances. Even though 2015 Q1 earnings were only $0.06 per share, the harsh weather impacted results. Management still talked quite positively about the future. Pipes certainly weren't freezing in Q2, so I expect much stronger results to be announced for Q2. TD Ameritrade shows expected earnings of $0.28 per share for both Q2 & Q3 of 2015.

So that's it. Despite not liking the general market here (kind of scary technical and fundamental situations in my opinion), I still think it's fairly likely KINS will release a good 2015 Q2 earnings report after the market closes next Wednesday, 8-12-15. There's a good chance of a 20% increase in the dividend then or soon after too. If Q2 turns out not to be that great, KINS is still a solid little company that pays a dividend and seems to have at least some reasonable growth prospects. I've got my full position in place. Still 3 trading days left for any other courageous souls to buy at least a partial position too.

Trading Notes: The past few days I saw a buy order in place for 10,000 shares at $7.60. None of it filled as far as I could tell, although at times it was the highest bid. Today (Friday, 8-7-15), there were 2,700 shares asking $7.64 virtually all day long. I bought half that many (1,350) shares in the last half hour of trade and the TD Ameritrade screen showed 1,400 shares asked at $7.64 just before the close.

Recent low was the 5-7-15 flash crash to $6.11. That was the only day since 2015 Q1 earnings it was below $7.05. Although I've been watching, the lowest I've actually seen the price since Q1 earnings were released was $7.10. Yes, I know, should have bought then. Hindsight is so wonderful - and useless.

Recent high was a spike up to $7.99 on 7-21-15, which was quickly rejected, too. Don't really expect KINS to do much of anything in the 3 days before earnings are released (it barely traded at all today), but you never know.

This is a small company. The stock doesn't trade at all for hours at a time. Always use limit orders. Don't place market orders. If you need deep liquidity, this isn't it - run the other way!

Disclosure: I have no inside information or special knowledge of the company. I could be wrong. Have been before (more than once!). I'm no expert. If you buy in and the stock goes down, I will be gone until September, so you will have to wait until then to scream at me. Won't do you or me any good anyway. I will feel bad enough as it is. If you buy in, good luck, hope we and KINS do fabulously!

CROC-- a very good idea! What else do you like?

very cheap-when the seller is finished, the shares ought to move right back to 8.50 Getting excellent growth on the cheap, etc.

From Barrons today:



Sandler O’Neill + Partners:
Allstate is seen as a large-cap pick in the sector while Kingstone is a small-cap favorite.

Our small-cap highlighted stock for this quarter is Kingstone ( KINS ). This is an unusual micro-cap insurer. It is almost a pure play on the home insurance business in New York state. The operating environment still looks good for Kingstone. The fourth quarter so far is shaping up to be a strong quarter with relatively light weather in downstate New York where most of its business is written. Third, we think the valuation is attractive.

We currently have Buy ratings on American International Group ( AIG ), Atlas Financial Holdings ( AFH ), Allstate, EMC Insurance Group ( EMCI ), Heritage Insurance Holdings ( HRTG ), Kemper ( KMPR ), Kingstone, Navigators Group ( NAVG ) and XL Group ( XL ).

KINS looks very cheap for the growth. Next year's earnings projections are for .95 cents- one dollar. If that's right, then this is trading at 8 times next years number, which seems way too cheap. Maybe that's why the insiders have continued to buy. They've been right for about three-four years!!

Company looks good. Bought in today.

I like KINS as much as any of my holdings right now. Great chart, good fundies and a ton of insider buys.

SNFCA is another one I like.

Hey ST- I think you've got a winner in this little company. What else do you like?

KINS $7.36 The chart is starting to look very good as well.

http://screencast.com/t/FaQWDEx0

The insiders appear to agree with you. Another form 4 filed today.

http://www.otcmarkets.com/stock/KINS/filings

Kingstone reported quarterly earnings of .18. This is up from .16 last quarter and .02 yoy (last year included effects of Superstorm Sandy).

Policies continue to grow and the change in the reinsurance structure is really helping. They seem to be firing on all cylinders, and i think next Q should even be more pronounced. Seems like a good buy at $7.