by Travis Johnson, Stock Gumshoe | August 23, 2013 5:00 pm
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Third Point Reinsurance (TPRE) – good enough to be on the Irregulars Speculative list? Or just perhaps a Irregulars Watchlist candidate?
Good question. I’ll add it to the watch list because its so new that I don’t have a high degree of confidence yet.
Travis, Thanks for the excellent analysis as usual.
You’re obviously a very smart and talented guy; that’s one reason why I follow you.
And you’re way too smart to buy into, man-made global warming, the biggest fraud ever perpetrated on mankind. I hope your off hand mention of it doesn’t mean that you believe the alarmists.
The climate models that are the sole basis for relating CO2 to warming have been shown to be scientifically flawed (33 years of measured temperature data show that they are off by an average factor of 4).
There is no increase in extreme weather-costs of weather events are rising because we keep building expensive things in weather’s path
Keep up the good investment work and forget about global warming.
It would be nice to have the option to block annoying trolls so you don’t see their comments. The Motley Fool site has this capability and it works quite well.
Now this is an interesting exchange between two irregulars.
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Travis, Thanks for the excellent analysis as usual.
You’re obviously a very smart and talented guy; that’s one reason why I follow you.
And you’re way too smart to buy into, man-made global warming, the biggest fraud ever perpetrated on mankind. I hope your off hand mention of it doesn’t mean that you believe the alarmists.
The climate models that are the sole basis for relating CO2 to warming have been shown to be scientifically flawed (33 years of measured temperature data show that they are off by an average factor of 4).
There is no increase in extreme weather-costs of weather events are rising because we keep building expensive things in weather’s path
Keep up the good investment work and forget about global warming.
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Reply
It would be nice to have the option to block annoying trolls so you don’t see their comments. The Motley Fool site has this capability and it works quite well.
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The first gentleman makes an argument for his point of view and cites facts that can be verified [or disproved] easily enough. I offer no opinion here but his argument is coherent, be it right or be it wrong.
The second gentleman replies with a personal affront.
I may be assuming where assumption is not due, but I guess the first gentleman is conservative and the second liberal.
My point is that investing requires data and logic. There may be satisfaction is name calling, at least for the vocalist, but no money.
Mr Greifendorff. I concur with one caveat. With the mountain of data on global warming mounting almost daily, It is not always “easy” to verify facts without references .
Like almost all scientists I’m convinced about climate change, but unless there’s a stock that’s success or failure was germane to the climate “debate” (for instance large construction firms who could build large dikes) , we should stick to stock issues. That’s why we pay to be here. But I need to mention that when we are presenting ANY “facts”, that we need to reference our sources. It would be a tragedy if we based decisions on facts that were unsubstantiated.
Here’s a “fact” I saw today on the news. “Polar Ice Cap grows by 30%”
Apologies my comment was so blunt and I’ve subsequently been off line for the last week, but I saw no reason for Mr Tucker to send the discussion off towards such a divisive subject. I’ve seen so many sites spoiled by politics and similar comments. Once that happens we start arguing over something we’ll never agree on, rather than discussing the idea of the month.
Thanks!
Yes, investing requires data and logic, and that’s exactly why someone who argues with global warming is suspect.
FYI: Vector Vest analysis on TPRE: has a current Value of $19.38 per share. Therefore, it is undervalued compared to its Price of $13.19 per share. TPRE has an Relative Value of 1.32, which is very good on a scale of 0.00 to 2.00. TPRE has an Relative Safety rating of 0.78, which is poor on a scale of 0.00 to 2.00. TPRE has a Relative Timing rating of 0.98, which is fair on a scale of 0.00 to 2.00. TPRE has a VST overall rating of 1.03, which is fair on a scale of 0.00 to 2.00. TPRE has a Hold recommendation. TPRE has a forecasted Earnings Growth Rate of 21.00%, which VectorVest considers to be excellent. TPRE has a CI rating of 1.00, which is fair on a scale of 0.00 to 2.00. CI is quite different from RS in that it is based solely upon a stock’s long-term price history. VectorVest advocates the purchase of high CI stocks. TPRE has a Sales Growth of 999.00% per year. This is excellent. VectorVest advocates the purchase of safe, undervalued stocks rising in price.
Hi,
I begin to wonder if this is a real bad replay of the 80’s? For those of you that weren’t in the business, and I still am, recall that we had naive capacity? Some CEOs & CFO’s had the brilliant idea that they could underwrite reinsurance in, what they thought was, a risk-less environment due to the ungodly high interest rates. and beat the”swing” due to investment income. . ( I.E. Run a big combined only to be offset by said income as prime was at 20 plus percent?) Run some research on busted reinsurance companies like Mission RE among others… So, to the point, 30 plus years later, comes along hedgies thinking they, too, can beat the cycle by investing in long term liabilities… You have only to look at Greenlight RE’s foible.. Classic bell weather – Capacity in adverse lines like long haul trucking auto liability. Guess Einhorn learned the dark art of underwriting is just that. There are certain classes you will not make a buck on…. What next, coastal property or residential general contractors in Florida or other gems?
In the future, before you invest a dime, consider, rigorously, vetting of the underwriting, actuarial and claim legal staff? Age, who’d they work fo,r etc as history, in this business, has it has a nasty habit of repeating itself… Insurance is a low ROE high expense . long tail business. Just ask Lloyd’s members how they are doing? Plus, check out recent asbestos and environmental reserves posted by my industry in the last quarter… No fun for sure…
Excellent points, Mark. Definitely a key concern for the new wave of reinsurers — I’m a lot more confident in GLRE now that they’ve been through some of the growing pains of bad underwriting deals, but I’m sure they’ll make more mistakes, and I’ll be watching TPRE over the years to come to see what happens when they do some bad underwriting (it seems inevitable). If they lose focus on underwriting that will certainly be a reason to be more skeptical, but near book value I think there’s a compelling opportunity with great investors at the helm. We’ll see how it works out.