If book value here is only $565...and WTM is now $532....then where is the big upside? because with WTM around here we are trading at almost 95% of book value! Which means WTM is no longer trading at a big discount to book....and WTM might not be as anxious to "backstop" us.... a free "put"...and buy more at 95% of book value. Also, WTM spent a TON of $$ already in last 9 months on buybacks. It is buying by WTM that propelled WTM up. It wasn't market or performance by operations. It was BUY BACKS. So if they slow down because we are already at 95% of book, is it time to go?
I lightened up. I have a nice profit. THANKS much WTM mgmt! But the price to BV is very narrowed now. Well, supposedly.
It was not solely buybacks, combined ratios for Sirius and One Beacon were stellar. The reorg has been a huge success and has freed up ~2B in capital that is still to be deployed. We could see some advantageous acquisitions that will add to future BV and earnings. Many companies are trading below BV and are instantly BV accretive.
<<We repurchased approximately 974,000 of our common shares at good prices, adding about $7 to adjusted book value per share in the quarter." >>
Adding $7 per share in book value. There are 6.6 million shares out. Adding $7 per share in book, times 6.6 million....means that the repurchase of over 970,000 shares.....for a total cost of $484,000,000.....added only $7 per share increase of book, on 6.6 million shares..or total add of $46 million
They spent $484 million - to get a per share book increase by $7.... of $46 million?
I know results looked god. But they aren't that good to warrant paying closer to 100% of book. As another poster dsaid there are plenty of others trading WELL below book. SYA is 20% owned by WTM. SYA is around $11. The adjusted book of SYA is around $17 or $18 ????? So SYA trdes at 60$% of book?? I'd rather nose aroudn there than WTM at 95% of book. Because WTM spent $484 million to only add $49 million of per share increase in BV.