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Guest Bronco

Where is Dave Matthews right now?  Is Fremont Insurance now a good investment?  You can buy this bargain below $20!

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What do you think?

 

Book value is $47.6m (much of which is in safe fixed income securities), market cap $33.9. The only thing that bothers me is that a not insignificant part of the equity portfolio is in mutual funds. All investments are of investment grade and fall within the top two tiers set by the ratings agencies. A.M Best have an A- rating for what it's worth. Combined ratio has stayed consistantly below 100 over the last 5-6 years. Reserving has remained conservative in the meantime.

 

My only concern is that as they've grown their lines of business, the loss ratios have started to creep up.

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Guest Bronco

I think it is a value play...cheap about to get cheaper.  And I think management is just as greedy and selfish as biglari.  I'll visit this at 17.

 

In the meantime....all the little ants are marching

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Management is as greedy and selfish as Biglari? Did you look at Fremont's compensation table for 2009? Did you compare it to other similarly sized insurance companies? I picked three at random, (AAME, ASAM, GAN) and in two cases, executive compensation was a multiple of what Fremont's management is earning, and in the other case it was marginally higher. If anything, these guys earn less than the industry average.

 

To be honest, now that Biglari's true colours have been revealed, I'm glad that Fremont took action to block the Steak n' Shake takeover. There's no reason why management can't continue to plough ahead on their own, growing the business by 20-25% every year.

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Guest Bronco

IMO - both Fremont and Biglari have top management that only care about their own skins.  No other way to slice it.  Both disgraceful.

 

Have you ever been to Michigan?  It only costs $90,000 to buy a palace.  And real estate taxes are only $2,000 per year.  If I lived there with what I get paid in the NE US, I would be a King.  Now, I am only a pauper.

 

 

 

 

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Guest Bronco

Shalab - I am probably splitting hairs, and while I respect everyone's opinion, I find the use of state Senators to keep one's job absolutely disgusting.

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Guest Bronco

Shalab - no doubt you are right, but I am also having a little fun with this. 

 

In my sick ideal world, Biglari would have kept doing Biglari things without the compensation nonsense and Fremont would have accepted the merger.  I would really enjoy watching someone try to do what Buffett did (capital allocation model, float, etc...).  Now I feel like we'll never know....

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I don't like the recent behavior of either CEO...Sardar's name change & compensation package, along with the little "notation" that a shareholder vote is simply a formality to sanction the package for tax reasons...nor Dunning's disgusting personal use of a senator to block anyone from removing him from his position...not to mention the senator whose ethics are equally compromised!  All completely unethical!  I don't think anyone is better or worse than the other here.  Cheers!

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