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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (60385)	2/15/2018 3:07:08 PM
From: Graham Osborn	Respond to of 78740

I've actually never bought insurance shares (apart from a couple Berkshire Bs). These are just rules I apply to companies in general, and I figure if anything they should be more aggressive for financials. It's a cyclical industry by nature and margins tend to be poor when rates are low. I know in the 30s-50s where an era when some insurers were selling for peanuts and if such times come again maybe I'll start looking at them as a class. I guess there were probably some bargains in 2008 as well.

To: Paul Senior who wrote (60385)	2/15/2018 3:24:41 PM
From: Graham Osborn	Respond to of 78740

I don't know a thing about insurance investing beyond that basic ratios people look at. These are just ratios I use for all companies. I find it extremely difficult to assess whether an insurer is profitable or adequately reserved. Maybe if the valuations get absolutely insane one day I will start looking. Just with a screen of tang book < LT debt, price/ tang book < 2, 5-year tang book growth > 10%, PE < 20 I pulled up: ESGR IAG.TO AEL DCNSF ELF.TO TPRE EIG MTG But again, I wouldn't feel competent to diligence any of these. These days it feels like the insurers growing most rapidly are the ones taking on the most risk.