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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (47034)	3/14/2012 9:25:37 PM
From: E_K_S	Read Replies (1) of 78625

"...I'd rather have MET or something with a p/e of 5-7..."; so I was going to say look at The Travelers Companies, Inc. C (TRV). A recent SeekingAlpha article listed it as undervalued when compared to it's GN of $68.74 ( seekingalpha.com ). The article failed to use the TBV. I still have it on my "value" watch list at it's current price of $58.90. MetLife was one of four companies that failed the Federal Reserve’s Comprehensive Capital Analysis and Review test, which was applied to many of the largest U.S. financial firms. MetLife Fumes as it Fails Fed Stress Test forbes.com However digging deeper in the article: "...Last December, MetLife reached an agreement with General Electric to sell its online banking operations, and it is also winding down MetLife Bank’s forward mortgage business and so by mid-2012 it will cease to be considered a bank. MetLife had excess capital of $3.5 billion at the end of 2011 and management expects that to grow to $6-7 billion by the end of 2012. The company wants to return excess capital to its shareholders, but its plan for $2 billion in stock repurchases and a dividend increase from $0.74 per share to $1.10 per share was rejected by the Fed...." But now that I read the Forbes article about MET, it actually may be a buying opportunity w/ all the negative news regarding their failed stress test. MET appears to have offloaded their banking division along w/ it's forward mortgage business. I am not sure if everything has been written down and/or if the FED consider these transactions in their stress test but these are the event driven news that can create value opportunities. According to the link referenced in the Forbes article (http://www.trefis.com/company?hm=MET.trefis# ), they value MET at $39.23 or 6% below it's current market price. ------------------------------------------------------------------- Therefore, I still think TRV presents a low risk value play in the insurance business. I do not own it but have been watching it along with your buys in MET. Link to Yahoo Finance: TRV & MET: goo.gl EKS

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