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  • 3 weeks later...
Posted

Indeed right now, we're seeing some cheapness due to fears about the downcycle of the reinsurance market (lower pricing on reinsurance contracts).

Some of the smaller Bermuda based reinsurer valuations:

 

http://i163.photobucket.com/albums/t314/ripleyx/reinsurers-smallmidcap-jan2010.jpg

 

 

These reinsurers have been doing quite well. They probably have even a better outlook given that the Fed 'won't raise rates for many months'.

 

http://i163.photobucket.com/albums/t314/ripleyx/reinsurance.jpg

 

My picks are RE and ENH, given their high quality combined ratios and higher AM Best ratings. If I recall correctly, Einhorn/Greenlight has a stake in RE. ENH recently beat analyst estimates by a wide margin for their most recent earnings announcement.

Guest dealraker
Posted

What I find interesting is that on a board with Berkshire's name on it there was no interest at all in buying BRK when it was selling for $98,000 per share while investments per share were over $90,000 and non-insurance operating earnings of around $5,000. 

 

The way I looked at it, on a cash basis an owner was getting back his money with net cash, investments and income- within 2 years.  Instead there was extensive interest in the fellow running SNS and discussion on how Markel would earn higher returns.

 

Markel?  I've owned the stock for 15 years.  Berkshire was a much better buy in my opinion than Markel or Fairfax- and I've owned Fairfax long before it came on the US board- to then delist.  I also owned Hub when FFH was a 40% owner and had bought it on the Toronto exchange too and I think I remember getting it at 8 times earnings that were growing at 15% a year.  So I've participated in a lot of what is disussed here.

 

I think the Market model of having investments of 3 or more times equity is a good one but I've sort of come to the conclusion that this ratio is going to gradually fall as Markel will be unable to continue to grow float at the old rate.  Thus the earn 5% on investments and get a 15% annual return model will slowly grind down.

 

But I just don't get the lack of interest in Berkshire's stock.  The book called, "The Diamonds are Under Your Feet" comes to mind.

 

Just interesting to me.

Posted

Most of us know Berkshire rather well and what it can do, I'd slap a 30 billion dollar valuation on Geico alone, but as a whole the company doesn't increase its value by 30,000$ per share each year to be as attractive as Fairfax is at these valuations.  Markel would have to be at a pretty large discount to Fairfax for me to pick up some shares.  

Posted

What I find interesting is that on a board with Berkshire's name on it there was no interest at all in buying BRK when it was selling for $98,000 per share while investments per share were over $90,000 and non-insurance operating earnings of around $5,000. 

 

The way I looked at it, on a cash basis an owner was getting back his money with net cash, investments and income- within 2 years.  Instead there was extensive interest in the fellow running SNS and discussion on how Markel would earn higher returns.

 

Markel?  I've owned the stock for 15 years.  Berkshire was a much better buy in my opinion than Markel or Fairfax- and I've owned Fairfax long before it came on the US board- to then delist.  I also owned Hub when FFH was a 40% owner and had bought it on the Toronto exchange too and I think I remember getting it at 8 times earnings that were growing at 15% a year.  So I've participated in a lot of what is disussed here.

 

I think the Market model of having investments of 3 or more times equity is a good one but I've sort of come to the conclusion that this ratio is going to gradually fall as Markel will be unable to continue to grow float at the old rate.  Thus the earn 5% on investments and get a 15% annual return model will slowly grind down.

 

But I just don't get the lack of interest in Berkshire's stock.  The book called, "The Diamonds are Under Your Feet" comes to mind.

 

Just interesting to me.

 

Well, I bough about 10% of my portfolio in BRK at 98k. But I didn't buy more because it was a situation with low downside and good upside. It was a good investment, but it was not screaming 10% over S&P return for the next 10 years. Still, I love BRK it's one of those investment where you can buy and forget it's even in your portfolio... it just grows slowly and steadily.

 

About SNS...there was plenny of occasions to buy BRK at around BV in the last 40 years so SNS will give us some opportunities if the kid does half as good as what this board is expecting. We don't have to be there for the first inning to make money.

 

I believe that in the end, it's all about asymetric risk/reward, the more asymetric it is, the most attractive it must be for us. So, the smaller the manager's portfolio the more reward there is.

 

BeerBaron

Posted

What I find interesting is that on a board with Berkshire's name on it there was no interest at all in buying BRK when it was selling for $98,000 per share while investments per share were over $90,000 and non-insurance operating earnings of around $5,000. 

 

The way I looked at it, on a cash basis an owner was getting back his money with net cash, investments and income- within 2 years.  Instead there was extensive interest in the fellow running SNS and discussion on how Markel would earn higher returns.

 

Markel?  I've owned the stock for 15 years.  Berkshire was a much better buy in my opinion than Markel or Fairfax- and I've owned Fairfax long before it came on the US board- to then delist.  I also owned Hub when FFH was a 40% owner and had bought it on the Toronto exchange too and I think I remember getting it at 8 times earnings that were growing at 15% a year.  So I've participated in a lot of what is disussed here.

 

I think the Market model of having investments of 3 or more times equity is a good one but I've sort of come to the conclusion that this ratio is going to gradually fall as Markel will be unable to continue to grow float at the old rate.  Thus the earn 5% on investments and get a 15% annual return model will slowly grind down.

 

But I just don't get the lack of interest in Berkshire's stock.  The book called, "The Diamonds are Under Your Feet" comes to mind.

 

Just interesting to me.

 

Who says there wasn't any?  It's just not something that really needs to be discussed over and over...I know I bought.

Posted

Well actually I was fortunate to have cash ready when it was at 70K-80K recently and deployed some of it to buy more BRK. I have a lot in BRK but for some reason it like I can forget about it.

Posted

Count me as one who was buying BRK in the past 3-4 months.  I only nibbled around the lows in March because other things seemed better, but in Q4 '09, I have to admit to getting pretty excited.  I made BRK a 10% position as was debating doubling that, but decided against it.

 

No one needed to write about BRK because it was obvious, not because we weren't buyers/owners.

 

that's my take at least.

 

Ben

Posted

Berkshire in my opinion needs too much to move the needle. Great for a large investor but if you got  $100,000 to $200,000 there are better bargains. FFH Options last year being one of them. Mines are up 200%. Some are trying to protect wealth, and others are trying to build it. Buying Berkshire in my opinion depends on what stage you are in.

 

Now those Bermuda insurers under bookvalue look interesting.

Posted

I too bought a smidgeon of BRK over the past couple of months.  I keep about a 5% position in the baby-Bs.  Maybe I should bump that up to 10% or more, but over recent years I've seen more value in other securities.....including FFH!

 

I love BRK because every few years Mr. Market gets depressed about how WEB has lost his touch, which provides a nice buying opportunity. 

 

SJ

  • 1 month later...
Posted

Warren E. Buffett, USA, informed us in accordance with Section 25, para. 1 of the German Securities Trading Act (WpHG) that on 11 March 2010 due to the exercise of all financial instruments which bear 1.945% of the voting rights (3,840,000 voting rights), he no longer held, directly or indirectly, any financial instruments that grant him the right to subscribe to shares in our company and would thus have fallen below the threshold of 5% of the voting rights if he had held shares instead of those financial instruments. Accordingly, as per this date he held directly or indirectly 7.988% of the voting rights (15,767,900 voting rights) pursuant to Section 21 para. 1 in connection with Section 22 para. 1 sentence 1 item 1 of the WpHG.

 

http://www.munichre.com/en/ir/publications/notifications/default.aspx

Posted

Looks like that Chile quake is having an impact after all. Just when you thought you had something so right ... bam ... out of the blue comes mother nature.

 

March 19 (Reuters) - The massive earthquake that rocked Chile recently caused an estimated $30

billion in damages to the relatively stable Latin American nation's infrastructure, homes and

industry.

    The 8.8-magnitude earthquake might cost the insurance industry up to $7 billion in damage

claims, the world's top two reinsurers Munich Re  and Swiss Re  said on March

10. [iD:nLDE6290ON] 

    Global insurers, also hit by February's European wind storm Xynthia, have since come out with

their initial loss estimates from both the catastrophes.

    Below are the loss estimates by some U.S.-based reinsurers:

   

    Company                                  RIC      Loss Est from            Loss est from

                                                      Chile, in $ mln          Xynthia, in $ mln

    PartnerRe Ltd                                220-320                  40-70

    Everest Re Group Ltd                          225                      25

    Validus Holdings Ltd                          170-270                  20-30

    XL Capital Ltd                                140-205                  20-25

    Platinum Underwriters Holdings Ltd          85*                      NA

    Montpelier Re Holdings Ltd                  75-100                  10***

    ACE Ltd                                      75**                    NA

    Endurance Specialty Holdings Ltd            65**                    NA 

    Transatlantic Holdings Inc                  60-90*                  NA

    Axis Capital Holdings Ltd                    60-125                  10-20

    Allied World Assurance Co Holdings          55-75                    2

    Flagstone Reinsurance Holdings Ltd          50                      3-6

    Max Capital Group Ltd                      10-20**                NA

    * Indicates combined losses from all catastrophes

    ** Indicates combined losses from both mentioned catastrophes

    *** Indicates combined losses from Xynthia and the Australian hailstorms will be lower than

reported figure

    -- RenaissanceRe Holdings Ltd  said impact of the events on its financial results will

be significant and could be material, but did not provide specific numbers

    -- These numbers are preliminary and may change with higher claims and rise in actual damages

 

  • 1 year later...

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