Peter,
As you can see, Trigon pulled back from it's high of 26 or 27 set a few weeks ago to Friday's close of 22. When this mutual company went public, some 24 millon were allocated to its policyholders. There was a six month lock out period where these shares could not be sold and when this period was over on 8/4, selling pressure caused the current dip.
In my opinion, although TGH closed higher the last two days, supply still exceeds demand and share price could dip another point or two before it stablizes. With the increased total tradable shares of some 40-44 million shares, I personally would wait until average daily volume drops to around 350,000 before making addition purchases. I would expect this to happen by month end.
To learn more about Trigon, you may try trigon.com. From what I know about Trigon, I believe they will either 1) become the premere mid-Atlantic managed care company or 2) they will become a sweet plum for purchase by a national company. In either case, share price will increase at a nice pace.
The last research report I saw on this company which was about three months ago (produced by either Wheat First or Scott Stringfellow, both located along with Trigon in Richmond, Virginia), had a 12 month target of 28-30. When Trigon went public in late January the same company had a 12 month target of 20-22.
The company has beaten quarterly projections by 3-5% in each of the first two quarters of reporting and it has been successful in increasing premium rates to more reasonable levels in recent months. Book value is around $21 and PE is approx. 14. I will be a buyer in the near term. I just don't know if that will be next week or in a couple of weeks, but it will be soon.
Regards
Dave |
