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Publicis Groupe SA Message Board

  • iwantwhatscomingtome iwantwhatscomingtome Sep 8, 2007 5:21 PM Flag

    single best idea?

    now that valuations are getting more attractive, how about a single-best idea [other than cash ] festival?

    here's mine:

    Validus is a post-Katrina reinsurer [no legacy exposure to Katrina, asbestos et al] that focuses on short-tail business.

    Goldman Sachs - one of VR's underwriters - issued a buy recommendation last week and has "a 12 month price target of $29, which we base off of our RAV model. We note that the shares are currently trading at a 6% discount to year-end 2007 estimated book despite an estimated 20.6% ROE."

    Estimates put p/e at just over 5x.

    I also note that it appears to me from the VR offering prospectus that it acquired the Talbot Lloyds business for about 3.2x net income.


    my runner up idea is WSC, but it is much less attractive in terms of income per share. It holds nearly as much cash as the share price, albeit encumbered by insurance obligations. And a lot of Proctor and Gamble and Coke stock. IF Munger ever does anything good with all that cash, this will be a good idea.

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    • Sometimes it pays to be lucky. Check out the 9/19/07 one day chart for VR.

      Of course I could claim skill and talent. I had put in a sell order for my target price of $26 2-3 days ago and today it executed. Sure enough, at the all time high. I will take it. Sometimes I doubt those charts that have a disconnect with the daily high and low but this one is true for sure.

      Even better it closed at 24.65 so I am looking to get right back in.

    • I loaded MSFT this a.m., also took on a position in FSR.

      Holding MO JNJ NSRGY.PK KFN PCH; short RYNWH.X puts

    • Wow, what a timely recommendation. What did you know and when did you know it? :-)

      I am actually in VR from the IPO and have been waiting for this to start getting coverage and take off which is now happening. Usually coverage begins 30 days or so after the IPO. It has been an undervalued gem for a few weeks now and is starting to get noticed. Should have more upside from here. What is your target price?

      • 1 Reply to stocktrend777
      • I forget why I found VR - but it was all public info. I passed on the IPO but was able to buy in open market mostly at 22 from 9/5 to 9/7. I figured that if I could buy at about book, 5x eps, no legacy issues, short-tail strategy, and Goldman had its money in it . . . probably pretty good odds.

        Today I picked up AINV near book, down about 10% the last few days having gone ex- and announced a secondary offering.

        I'm also trying to decide whether I'll exercise KFN rights offering at 14.40. I probably will if only to flip it.

    • Iwant-

      Have you ever looked at FSR? It is similar to VR.

      VR looks good, but the executive compensation seems high for a company of that size- the top five managers make around $2 million each.

      I see VR had a nice pop this morning.