Back to 1.2X Book, Good for Greenlight, and Some other Updates on New Stocks and Favorites

by Travis Johnson, Stock Gumshoe | February 10, 2013 10:10 pm

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Source URL: https://www.stockgumshoe.com/2013/02/back-to-1-2x-book-good-for-greenlight-and-some-other-updates-on-new-stocks-and-favorites/


11 responses to “Back to 1.2X Book, Good for Greenlight, and Some other Updates on New Stocks and Favorites”

  1. gottgruppiert says:

    I nibbled on some shares of GLRE in Dec when it took a dip. I also nibbled on some shares of AAPL when it went below $450. I think GPD would be a good one to add a starting position to now. I initially had it when it made its big run and the stopped about at $1.10. I think if you were willing to stomach some voliatility and hang onto it for a few years it would be a good one. Maybe even buy more if it drops further. It seems to me MKL shot right back up after the drop, I was hoping to catch it but I missed it. I think I will wait for another drop before nibbling on shares. I had to laugh about Einhorn’s crying about AAPL, maybe it will do some good but who know.

  2. blufox says:

    Travis, I always look forward to your comments and while I have nothing against MKL I wonder why you do not prefer FFH.TO, Fairfax Finaancial which yields 2.7%, is currently at $362, and is selling for just 86% of its 52 week high while MKL is at 98.9% of its 52 wk high. Prem Watsa runs Fairfax which started out as Markel Financial Holdings, a Canadian subsidiary of Markel.
    Regarding GPD.TO on reading your previous note I picked up some, thanks. I am planning on buying more this week.
    best wishes,
    /* Phil */

  3. lysander72 says:

    Sorry, but pet peeve of mine. Why do shareholders think “shareholders” rights plans are good for them.? The Gumshoe notes: “(posion pill) is intended to make sure it’s not easy for someone to take control without the board’s approval.” The board is management not the owners, their interests may very well differ from the owners (shareholders). Owners should decide ownership questions, certainly the board should express their view on any offer but the final decision should rest with shareholders. The buyout offer rejected by Nova Gold years ago is the classic example of shareholders passively accepting a board’s biased and bad decision. Also by making a buyout more difficult a posion pill lessens the number of suitors and hence you actually may receive a lower price. Of course, posion pills are advantegous for management (especially lousy ones) since it helps them protect their jobs.

  4. sportsbiz says:

    lysander72 couldn’t be more correct. The Board and management should almost never be considered on the side of shareholders these days as management is almost, not always, but almost always acting in its own self-interest and shareholder rights plans to thwart takeover attempts are prime examples of that. There are exceptions to every rule of course but passive shareholders rarely find themselves on the same side of a transaction as management with its jobs, options and warrants to consider.

  5. valentinoamoro says:

    Thanks for the update on ROIC. I’ve been holding onto their warrants and was wondering what caused the sudden drop. Your explanation about the dilution makes sense. Hopefully their upcoming earnings will provide a solid boost to their stock price.

  6. Looks like GLRE underwriting didn’t bounce back instantly — they did decide to book some reserves for Sandy and underwriting for the quarter just announced today (Feb. 19), and the expected investment losses did indeed hit the book value. Haven’t listened to the call yet for the details, but book value per share has dropped to about $22 so we could see a lower price when trading resumes tomorrow — I have a limit buy order still in place that’s close to that new lower book value, so it’s possible I’ll be adding to my holdings if the shares drop by more than 6-8% on the news.

    The weak investment quarter was pretty well known by investors already and they didn’t sell the shares, so the stock’s response to this quarter is likely to come from their explanation of the continuing turnaround in underwriting and anything they say about 2013 and their prospects for this year. The conference call isn’t until 9am tomorrow, so it might be a bumpy morning for the shares as whatever GLRE management says is digested just as the market opens.

  7. jpbel2003 says:

    Glre up on a down day with heavy volume after a mixed earnings report seems to indicate the market thinks glre can turn the ship around. If next quarter the investment portfolio can make money gmcr and appl are big factors, and underwriting improves we could be off to the races.

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