Category Archives: PKIN

Insurance Watch List: February 2016

Performance Review

From our watch list dated February 28, 2014, we have the following performance of the listed stocks:

Symbol Name 2014 2016 % change
BRO Brown & Brown 30.1 31.48 4.58%
WSH Willis Group 41.16 44.61 8.38%
XL XL Group plc 30.4 34.28 12.76%
PKIN Pekin Life 11.99 12.4 3.42%
AXS Axis Capital 43.97 53.97 22.74%

The average gain for the listed stocks was +10.38% as compared to the iShares U.S. Insurance ETF (IAK) which gained +4.25% over the same period of time (February 28, 2014 to February 21, 2016).  Although we use IAK as a benchmark for performance, it should be noted that companies like WSH [now Willis Tower Watson (WLTW) after the merger in 2015], XL and AXS are not U.S. based insurance companies.   The stock of interest at the time was Brown & Brown (BRO) which increased +4.58%.

Continue reading

Insurance Watch List: June 1, 2013

Anyone who wishes to be successful in insurance stocks should read the book The Davis Dynasty by John Rothchild. The book starts with Shelby Collum Davis investing approximately $50,000 to $100,000 that ultimately grew to $900 million after 47 years. The strategies employed by Davis seem highly accessible to average investors.

Below is the insurance watch list for companies that are within 20% of their respective 52-week low.

Continue reading

Insurance Watch List: March 27, 2013

The following is one of our personal favorite watch lists. We started tracking the insurance industry in January 2011 and we’re very impressed with the results so far.

Anyone who wishes to be successful in insurance stocks should read the book The Davis Dynasty by John Rothchild. The book starts with Shelby Collum Davis investing approximately $50,000 to $100,000 that ultimately grew to $900 million after 47 years. The strategies employed by Davis seem highly accessible to average investors.

Continue reading

Insurance Watch List: December 7, 2012

The following is one of our personal favorite watch lists. We started tracking the insurance industry in January 2011 and we’re very impressed with the results so far.

Anyone who wishes to be successful in insurance stocks should read the book The Davis Dynasty by John Rothchild. The book starts with Shelby Collum Davis investing approximately $50,000 to $100,000 that ultimately grew to $900 million after 47 years. The strategies employed by Davis seem more accessible to average investors as opposed to Warren Buffett’s leveraged strategies and education from Benjamin Graham.

Symbol Name Price P/E EPS Yield P/B payout ratio % from low
NSEC National Security Group Inc. 7.6 - -3.14 1.3 0.63 -3.18% 0.00%
MIG Meadowbrook Insurance Group 5.44 - -0.33 1.5 0.49 -24.24% 2.64%
GLRE Greenlight Capital Re, Ltd. 23.01 6.06 3.8 - 0.96 0.00% 3.46%
RLI RLI Corp. 64.23 12.35 5.2 2 1.52 24.62% 3.83%
PKIN Pekin Life Insurance Company 10.75 59.39 0.18 1.1 1.56 66.67% 4.37%
FRFHF Fairfax Financial Holdings 352.5 - -34.42 - 0.98 0.00% 4.71%
TWGP Tower Group Inc. 17.54 12.73 1.38 4.3 0.63 54.35% 6.30%
ANAT American National Insurance Co. 68.05 9.98 6.82 4.5 0.47 45.16% 6.86%
AIZ Assurant Inc. 34.81 4.93 7.06 2.4 0.53 11.90% 7.41%
CRVL CorVel Corporation 42.4 20.53 2.06 - 3.97 0.00% 7.45%
RGA Reinsurance Group of America 51.99 6.4 8.12 1.8 0.57 11.82% 7.51%
WSH Willis Group Holdings Plc 34.52 15.92 2.17 3.1 2.27 49.77% 7.94%
TDHOY T&D Holdings, Inc. 5.29 15.11 0.35 - 0.42 0.00% 8.18%
ASI American Safety Insurance Hlds 17.21 33.03 0.52 - 0.48 0.00% 9.27%
  • Avoid insurance stocks with payout ratios that are in the negative or exceeding 100%
  • Insurance stocks with low average trading volume have low liquidity and are considered higher risk

Watch List Summary

Since the publication of our watch list dated November 6, 2012, we have acquired two insurance stocks, American National Insurance (ANAT) on December 3, 2012 and Reinsurance Group of America (RGA) on December 6, 2012.  Combined, the stocks comprise 26% of our partnership portfolio.

Of interest to us on the current watch list is Greenlight Capital Re (GLRE).  The company has been publicly traded since 2007.  Although relatively new, we believe that with GLRE being in the reinsurance sector it is the most lucrative opportunity for insurance investing at the current time.

According to Dow Theory, Greenlight Capital Re has the following downside targets:

  • $22.93
  • $19.49
  • $16.07
  • $9.20

The short-term upside target is $26.35. 

Our interest in Greenlight Capital Re is not based on David Einhorn’s involvement with the company.  In fact, we believe that Einhorn’s notoriety and ever changing investment stance is a possible liability. Careful consideration of company fundamentals is required for anyone interested in this stock.