Investors interested in Insurance - Property and Casualty stocks are likely familiar with Skyward Specialty Insurance (SKWD) and Kinsale Capital Group, Inc. (KNSL). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Skyward Specialty Insurance and Kinsale Capital Group, Inc. are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that SKWD has an improving earnings outlook. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
SKWD currently has a forward P/E ratio of 14.91, while KNSL has a forward P/E of 28.41. We also note that SKWD has a PEG ratio of 0.83. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. KNSL currently has a PEG ratio of 1.89.
Another notable valuation metric for SKWD is its P/B ratio of 2.46. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, KNSL has a P/B of 6.98.
Based on these metrics and many more, SKWD holds a Value grade of A, while KNSL has a Value grade of D.
SKWD is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that SKWD is likely the superior value option right now.
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Today, See These 5 Potential Home Runs >>Skyward Specialty Insurance Group, Inc. (SKWD) : Free Stock Analysis Report
Kinsale Capital Group, Inc. (KNSL) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
