If HIG sold some of their divisions don't you think that it would be for the good of the company(increase in profits) and the stockholders? I would look for an increase in their stock price if part of their businesses were sold.
Maybe. It depends upon many variables. What is being sold? How much? How is the debt being handled? Terms/conditions, etc. If you isolate the P&C business, you might justify a multiple expansion approaching some of the best in breed. The key would be what would the book value of the businesses they're keeping and how do investors and wall street feel about Hartford's management team. Based on what we've seem under Liam's tenure, there's doesn't appear to be a lot of confidence in Hartford. Hartford has announced multiple plans then changed them, caved into a large shareholder's pressure, outsourced many jobs which has negatively impacted execution on plans and employee morale, and our executives aren't highly regarded based upon what I've experienced and what I've been told.
Ask yourself this question putting aside the price of the stock for discussion purposes. How does The Hartford compare to the Travelers, AIG, Liberty and Chubb? I think you get the point.
IF the Hartford were to be a pure P&C company it would likely command a multiple above 1 to BV. Unfortunately, it will be stuck with the drag of runoff operations, particularly VA, which will hurt this valuation. In addition, the current management has no eperience in P&C, including the CEO, CFO and chief risk officer. Who would bet on their ability to successfully maneuver the highly competitive P&C market?