Kingsway Financial Services (KFS) AI Stock Analysis

• Market Cap: $405.09M
• Dividend Yield: N/A
• Average Volume (3M): 66.42K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.71
• Revenue Growth: 9.20%
• EPS Growth: -115.04%
• Country: US
• Employees: 433
• Sector: Consumer Cyclical
• Sector Strength: 81
• Industry: Auto - Dealerships
• EPS (TTM): -0.13
• Shares Outstanding: 28,873,415
• 10 Day Avg. Volume: 56,596
• 30 Day Avg. Volume: 66,418
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.06
• Enterprise Value/Revenue: 3.67
• Enterprise Value/Gross Profit: 4.04
• Enterprise Value/Ebitda: 170.56
• 1Y Price Target: $14.50
• Price Target Upside: 0.69% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 51 Neutral
• Price Target: $14.50 ▲(0.69% Upside)

Kingsway Financial Services faces significant financial challenges, with high leverage and negative profitability impacting its overall score. While technical indicators are neutral, the company's valuation remains unattractive due to a negative P/E ratio. The strategic acquisition of Roundhouse Electric is a positive development, but the overall financial health remains a concern.

Kingsway Financial Services Business Overview & Revenue Model

Company Description

Kingsway Financial Services (KFS) is a diversified financial services company specializing in insurance, asset management, and investment solutions. With a focus on providing innovative financial products, KFS serves a wide range of clients including individuals, businesses, and institutions. The company operates in various sectors, including health insurance, property and casualty insurance, and investment advisory services, leveraging a robust portfolio of offerings designed to meet the evolving needs of its customers.

How the Company Makes Money

Kingsway Financial Services generates revenue through multiple streams, primarily from the sale of insurance policies, management fees from assets under management, and commissions from financial product sales. The company's insurance segment earns money by underwriting various insurance products, collecting premiums, and investing the reserves until claims are paid out. Additionally, KFS earns management fees from its investment advisory services based on a percentage of assets under management. Strategic partnerships with other financial institutions and technology providers also enhance its service offerings and contribute to revenue growth, enabling KFS to offer competitive financial solutions while expanding its market reach.

Kingsway Financial Services Financial Statement Overview

Summary

Kingsway Financial Services faces significant financial challenges across all verticals. The company demonstrates strong gross profit margins but struggles with profitability and operational efficiency. High leverage and negative returns on equity pose financial risks, while cash flow management remains a critical concern. The company needs to focus on improving profitability and reducing leverage to enhance financial stability.

Income Statement

Kingsway Financial Services shows a mixed performance in its income statement. The TTM gross profit margin is strong at 90.78%, indicating efficient cost management. However, the net profit margin is negative at -9.59%, reflecting ongoing profitability challenges. Revenue growth is modest at 3.41% TTM, but the negative EBIT margin of -2.63% suggests operational inefficiencies. Overall, while there is revenue growth, profitability remains a concern.

Balance Sheet

The balance sheet reveals significant leverage with a TTM debt-to-equity ratio of 1.82, which is an improvement from previous years but still indicates high financial risk. The return on equity is negative at -50.68%, highlighting the company's struggle to generate returns for shareholders. The equity ratio is low, suggesting limited equity financing. Overall, the balance sheet reflects high leverage and poor returns on equity.

Cash Flow

Cash flow analysis shows a challenging situation with negative operating cash flow and free cash flow in the TTM period. The free cash flow growth rate is positive at 9.55%, but the operating cash flow to net income ratio is negative, indicating cash flow issues. The free cash flow to net income ratio is 1.43, suggesting some ability to cover net losses with free cash flow. Overall, cash flow management appears weak, with significant room for improvement.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	116.64M	109.38M	109.12M	96.50M	81.41M	64.81M
Gross Profit	105.88M	82.65M	109.12M	96.50M	83.91M	39.87M
EBITDA	2.51M	2.16M	5.93M	11.79M	2.09M	14.11M
Net Income	-11.18M	-9.27M	23.56M	24.72M	-342.00K	-6.72M
Balance Sheet
Total Assets	207.70M	186.62M	197.72M	285.65M	475.63M	452.47M
Cash, Cash Equivalents and Short-Term Investments	12.08M	5.49M	9.26M	64.33M	12.80M	14.53M
Total Debt	61.16M	60.22M	45.61M	103.31M	96.58M	271.50M
Total Liabilities	172.09M	168.31M	173.11M	263.53M	460.88M	433.81M
Stockholders Equity	33.69M	16.66M	27.71M	21.68M	773.00K	4.51M
Cash Flow
Free Cash Flow	-1.71M	358.00K	-26.39M	11.89M	-6.74M	1.46M
Operating Cash Flow	-1.20M	1.07M	-26.19M	-14.57M	-5.91M	1.67M
Investing Cash Flow	-31.45M	-16.85M	6.46M	100.94M	-8.60M	4.01M
Financing Cash Flow	34.19M	11.44M	-39.96M	-37.93M	-540.00K	13.60M

Kingsway Financial Services Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 14.40
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KFS, the sentiment is Positive. The current price of 14.4 is above the 20-day moving average (MA) of 14.11, above the 50-day MA of 14.28, and above the 200-day MA of 10.41, indicating a bullish trend. The MACD of 0.06 indicates Negative momentum. The RSI at 53.76 is Neutral, neither overbought nor oversold. The STOCH value of 58.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KFS.

Kingsway Financial Services Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CARS	71 Outperform	$835.04M	22.00	8.37%	―	0.68%	67.41%
CANG	64 Neutral	$893.42M	6.63	-31.61%	―	348.38%	-1821.85%
Sector *	61 Neutral	$18.02B	12.77	-0.74%	3.01%	1.30%	-13.03%
RDNW	52 Neutral	$145.74M	―	-246.90%	―	-14.27%	67.06%
KFS	51 Neutral	$405.09M	―	-39.82%	―	9.20%	-115.04%
CRMT	50 Neutral	$297.50M	24.22	2.54%	―	0.79%	―
SDA	46 Neutral	$276.11M	―	-167.38%	―	―	―

Kingsway Financial Services Corporate Events

Kingsway Financial Completes Acquisition of Roundhouse Electric

On July 1, 2025, Kingsway Financial Services Inc., through its subsidiary Longhorns Acquisition LLC, completed the acquisition of Roundhouse Electric & Equipment Co., Inc., a Texas corporation. The transaction involved a combination of cash and debt financing, with Kingsway granting rollover phantom equity rights valued at approximately $3.5 million and paying cash consideration based on an enterprise valuation of $22.35 million. This strategic acquisition is expected to enhance Kingsway’s market position and operational capabilities in the electric equipment industry. Additionally, Kingsway and Roundhouse entered into a new secured term credit facility with Main Street Bank, comprising a $11 million term loan, a revolving credit facility, and a non-revolving equipment guidance line of credit, which will support the financial structuring of the acquisition.