Recently I published the list 15 small financial stock hedge funds are buying. In this article, we will introduce Kinsale Capital Group, Inc. We’ll look at the locations (NYSE: KNSL) representing other small financial stocks that hedge funds buy.
Like other sectors of the economy, the financial and banking sectors can be hit by tariff uncertainty and fears of recession. On April 8, Reuters reported that the bank’s revenue season is likely to move from profitable banks to losses. Wells Fargo analyst Mike Mayo noted that the bank’s revenue season will reveal the biggest impact of tariffs next year as banks need to secure higher reserves for loans due to the fear of a recession. Additionally, Stephen Biggar, director of financial institutions at Argus Research, said that banks directly reflect the economy, and as markets slow, the sector could potentially have the most difficult hit.
I joined Yahoo Finance for an interview on April 10th to talk about the impact of tariffs on Suryansh Sharma, the banking division, a senior equity analyst at Morningstar. This aggression was in terms of the country’s breadth and product ranges covered by these tariffs. However, the policy has been suspended for 90 days, but the uncertainty has not ended. Sharma believes that if these tariffs remain in effect, they will be harmful to the US economy. This is important for the banking sector as this sector is closely linked to the US macroeconomic performance. Therefore, if the economy is not working, the banks and financial sectors don’t work well.
Sharma explained more about the impact of tariffs. He emphasized that if tariffs were maintained, the economy could be heading towards a recession as macroeconomic conditions are likely to deteriorate. Many sectors benefit from low interest rates, but the banking sector does not. A lower interest rate means contracting assets management and net interest income on bank stocks. Furthermore, given the high levels of uncertainty, loan growth is expected to be downward, which will affect overall merger and acquisition activities. Sharma emphasized that the market expects the Trump administration to bring about a lot of M&A activities that will lead to a banking sector boom, but the current situation points to the bust of the banking sector.
Finally, analysts emphasized that Morningstar thinks the banking sector is still undervalued compared to other sectors, but very slightly undervalued. Therefore, he suggests that investors are highly selective in choosing the bank they want to invest in. He likes financial stocks that have the ability to generate strong fees and are relatively undervalued than fair value.
To compile a list of 15 small financial stocks purchased by hedge funds, we used Finviz Stock Screener and Insider Monkey’s Q4 2024 hedge fund database. We used the screener to aggregate a list of financial services stocks trading at a market capitalization of at least $10 billion. For the purposes of this article, we define small financial services stocks as stocks trading between $10 billion and $20 billion in market capitalization. We then cross-checked the market capitalization from Yahoo Finance and then ranked the stocks in ascending order of the number of hedge fund holders. Market capitalization was used as a tiebreaker if two or more shares were held by the same number of hedge funds. Please note that data was collected on April 18, 2025.
Why are hedge funds interested in the stocks they accumulate? The reason is simple. Our research shows that mimic the top stock picks of the best hedge funds can outperform the market. Quarterly Newsletter’s strategy was to select 14 small and large caps per quarter, returning 373.4% since May 2014, surpassing the benchmark by 218 percentage points (For more information, please see here).
Kinsale Capital Group, Inc. (KNSL): Hedge funds buy among small financial stocks
A specialized insurance broker discussing compensation plans with small business owners.
Market capitalization: $1132.1 billion
Number of hedge fund holders: 36
Kinsale Capital Group, Inc. (NYSE: KNSL) is a specialized insurance company focused on the US excess and surplus line market. The excess and surplus line market refers to clients with high-risk insurance needs, which are not covered by regular insurance. The company operates both commercially and privately, operating through a network of independent brokers.
On April 10, Morgan Stanley analyst Bob Juan maintained his stock’s buy rating with a price target of $515. Giverny Capital Asset Management is a Investor Letter for the first quarter of 2025, Kinsale Capital Group, Inc. He also mentioned (NYSE: KNSL) and stated that he prefers the company’s founder and CEO, along with the cost discipline, technology and underwriting that has provided results. Additionally, the company maintains a clear strategic focus on small excesses and surplus accounts, providing absolute control over the underwriting and billing process. As a result, Gross Written Premiums for the fourth quarter of 2024 increased by 12.2%, while the victims’ division rose by 15%.
Management also includes Kinsale Capital Group, Inc. We also noted that it focuses on one of the key benefits of (NYSE: KNSL): technology-driven, low-cost operational models. We plan to invest in technology, automation, data and analytics to drive continuous growth. The company expects long-term growth of 10%-20% of the total total amount thanks to its stable submission growth and selective pricing strategy. This is one of the small financial stocks that hedge funds buy.
Giverny Capital Asset Management is Kinsale Capital Group, Inc. Regarding (NYSE: KNSL), the following has been stated: Q1 2025 Investor Letter:
“We’ve added to an existing location in Medpace Kinsale Capital Group, Inc. (NYSE: KNSL), both are one of the top 10 holdings. Medpace is a clinical research organization that helps emerging biopharma companies conduct trials with new compounds. I wrote about Kinsale in detail in my previous letter (all available on the www.givernycam.com website), but as a reminder I will write a line of what is called an excess and surplus insurance. Kinsale has a strong founder CEO at the helm of Mike Kehoe, with exceptional cost discipline, best-in-class technology and consistent underwriting results. ”
Overall, KNSL 10th place Hedge funds buy on the list of small financial stocks. While acknowledging the potential for KNSL to grow, our belief lies in the belief that AI stocks provide higher returns and hold a greater commitment to doing so within a shorter time frame. There have been AI stocks that have risen since the beginning of 2025, and the popular AI stocks have lost around 25%. If you’re looking for AI stocks that are more promising than KNSL, but are trading below 5 times the revenue, check out our report on this Cheapest AI stocks.
