Value Investing Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: anializer who wrote (36723)	2/21/2010 12:14:04 PM
From: Paul Senior	1 Recommendation Read Replies (1) of 78744

PMACA. "Another simple analysis might be that it sells at less than 50% of book value and fairly consistently makes money every quarter." Three reasons to buy PMACA seem to be: 1. The thing is selling for way under book value. 50% under is very unusual for a profitable insurance company. 2. The company is in transition. (Sold its run-off business.) 3. Dale Baker continually recommends it on the 50% Gains thread. His recommendation is good enough reason for some. The company earned .66 on its $12.46 of book value. That's 5.3%. Company's been unprofitable three of past ten years. In the seven years it's had profits, 5.3% seems to be the highest roe of any year. If earning 5.3% on their equity is the best & highest figure in a decade, what's going on? The stock deserves to sell at 50% of book if that's all management can deliver to shareholders. A counterargument would be, the company IS in transition, roe is improving (this year anyway), and earnings and bv should/could/might/will continue to improve. Too speculative an assumption for me - I can't get past management's ten year very poor roe and very poor bv history, so I have and will continue to avoid the stock.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next