Kinsale Capital Group, Inc. (KNSL): A Bull Case Theory

We came across a bullish thesis on Kinsale Capital Group, Inc. on Archive Invest’s Substack by Felix. In this article, we will summarize the bulls’ thesis on KNSL. Kinsale Capital Group, Inc.'s share was trading at $455.40 as of September 5^th. KNSL’s trailing and forward P/E were 23.77 and 21.79 respectively according to Yahoo Finance.

Kinsale Capital (KNSL) has established itself as a high-growth, capital-light insurance business with strong financial fundamentals and efficient capital allocation. The company’s total revenues have compounded at a 36% CAGR since 2020, while net income expanded from $88 million in 2020 to over $414 million in 2023, reflecting disciplined execution and a sharp earnings inflection. Operating income and free cash flow have also scaled consistently, with FCF reaching roughly $952 million, far exceeding capital expenditure requirements, which remain minimal due to the company’s capital-light model.

Insider ownership stands at 5.2%, below the 10% benchmark that better aligns management and shareholder interests, but the company compensates with robust profitability metrics. Margins remain strong, with stable operating and net income margins supporting high returns on invested capital, which now exceed 10%—a sign of prudent capital deployment. Importantly, Kinsale has no goodwill on its balance sheet, underscoring the organic strength of its business model.

While stock-based compensation modestly affects adjusted free cash flow, its impact is diluted by the company’s sizable cash generation. Share repurchases have been ongoing since 2020, with $17 million executed last year, reflecting management’s confidence in long-term prospects, though some investors argue funds could be better reinvested into growth.

Valuation metrics also appear favorable, as forward P/E trades below historical medians, suggesting potential undervaluation. Combined with strong free cash flow conversion, scalable profitability, and a clean balance sheet, Kinsale presents a compelling case of a business with resilient fundamentals, disciplined capital allocation, and attractive risk/reward positioning for long-term investors.

Previously we covered a bullish thesis on Kinsale Capital Group, Inc. (KNSL) by Felix in May 2025, which highlighted the company’s niche focus in the E&S market, strong underwriting discipline, and industry-leading combined ratio. The company’s stock price has appreciated approximately by 4.8% since our coverage. The thesis still stands as Kinsale continues to deliver profitable growth. Felix shares a similar view but emphasizes capital-light fundamentals and free cash flow.

Kinsale Capital Group, Inc.  is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 33 hedge fund portfolios held KNSL at the end of the first quarter which was 36 in the previous quarter. While we acknowledge the potential of KNSL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.