Author Topic: ACE - ACE Limited  (Read 3031 times)

cmattporter

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ACE - ACE Limited
« on: March 16, 2011, 02:56:20 PM »
EPS- 9.11
Book value 68.59
Market value 60
Dividend .33

They are undervalued and I don't see anything wrong with them. Their books are stable

Please tell me what you think

Thanks

Matt
« Last Edit: March 16, 2011, 03:24:22 PM by Parsad »


Liberty

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Re: ACE - ACE Limited
« Reply #1 on: March 16, 2011, 09:08:36 PM »
How much do you know about management?

What kind of compensation? Are their underwriters rewarded over long cycles? Does mgmt own a large fraction of the business? Good track record of integrity?
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Viking

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Re: ACE - ACE Limited
« Reply #2 on: March 17, 2011, 11:04:10 PM »
I like Ace. The CEO sounds very arrogant on conference calls; my read is they are very well run and trade at a reasonable valuation. They are on my short list of insurers I would like to own.

I don't currently own any insurers (although earlier this year I did hold WRB and PRE). Most will be reasonably profitable in the current environment (i.e. perhaps grow BV by 5% to 8%). There is still too much capacity out there; only very large catastrophe(s) will remove this excess capacity. Of course, as we have seen this week, when medium sized catastrophes hit, insurers sell off and some dramatically. So do I buy today at reasonable valuation to get 5% to 8% returns while waiting for a very large catastrophe to remove capacity to get to a hard market which will also likely tank the companies I own? Currently, I like WRB the most. Now that FFH is trading below book value it is back on my radar. RNR looks to be well managed. LRE also looks to have developed a great niche. I am happy today to fine tune my buy list and wait until the story gets better.

bluedevil

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Re: ACE - ACE Limited
« Reply #3 on: March 18, 2011, 09:08:07 AM »
Viking, do you have any thoughts on Everest Re vs. other insurers like Ace?  RE is trading at about .7x tangible book value.  And they seem to have some strengths - namely a strong rating (A+) and a worldwide distribution platform.

Viking

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Re: ACE - ACE Limited
« Reply #4 on: March 18, 2011, 09:16:40 AM »
bluedevil, I looked into Everest Re some time ago and, at the time, decided I liked PRE and RNR more as they looked to be higher quality companies... can't remember the exact reasons. ACE is larger and more diversified than any of the pure reinsurers. In my perfect world I would hold a basket of insurers (FFH, WRB, ACE, PRE or RNR). I find listening to the quarterly conference calls to be very informative (or reading the transcripts... go to Seeking Alpha for these).

Part of the challenge with the reinsurers is they all seem to be somewhat concentrated in some way (line of business or geography)... when catastrophes hit in areas they are concentrated in they fall out of favour. So it is hard to really understand the business and risks and that is why I think holding a basket makes some sense for the small investor.
« Last Edit: March 18, 2011, 09:19:47 AM by Viking »

bluedevil

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Re: ACE - ACE Limited
« Reply #5 on: March 18, 2011, 11:18:01 AM »
Thanks!

cmattporter

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Re: ACE - ACE Limited
« Reply #6 on: July 09, 2011, 06:52:48 AM »
Have you thought about investing in Torchmark. I think it is a very strong company and growing. P/E ratio is around 10 right now and bv is attractive. Not to mention Buffett owns it.
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