I have just started following this stock and wanted to hear some opinions on why this stock is so cheap. Specifically, how come it has a negative enterprise value and why is it selling for Price/free cash flow (P/FCF) of under 10?
Thanks in advance for your responses. BTW, I am a holder of Berkshire Hathaway and came across this stock when I was looking for potential acquisitions for Mr. Buffett. It certainly meets all his criteria...
I think I am just used to reading the financial statements of Berkshire in which the reserves against future claims (or float) is seperate from the investments. For BRK the investments are unencumbered but I guess that is not the case with ORI. Thanks for the input InvestIt.
Thanks for the reply. I do have an MBA so I am aware of inefficient markets but what I don't understand is if someone can buy this company with the cash on hand (and still have about $1.5+ left over) why it hasn't been done already (at the very least, management can do a LBO and take the company private if the public markets are this inefficient). Am I missing something here - is there some risk or liabilities that I am overlooking?