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Greenlight Capital Re, Ltd. Message Board

  • luckyjimsf luckyjimsf Aug 31, 2011 8:47 PM Flag

    value of glre investments vs price of glre stock

    does anyone on this board follow this? i'm rather puzzled as to why the stock is continuing to underperform the underlying investments, when the GLRE reinsurance business is supposedly doing reasonably well per the company's 1/4ly statements (stock -16.5% YTD vs investments -5.3% YTD, with the gap widening further in august per the just posted monthly investment performance).

    is there a 3rd variable i should be examining that influences their performance?
    is it just that this stock is misunderstood? is einhorn losing his appeal as an investment manager?

    please can anyone help me out here with some info?

    i only recently discovered this stock and have been accumulating it all month between $21 and $22.20, as it feels like a good value to me--tho it's sometimes hard to trade.

    it does look like it's basing after dropping to what i think will be lit's low for the year at $20.39, but i'd welcome any thoughts y'all have.

    thanks so much for any light anyone can shed on greenlight... ;)

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    • well we got thro september and glre stock is down 7.5 % despite a .2% gain in the investment portfolio and an upgrade of the insurance business from am best. guess we still need to be patient....

    • book value is $19+/share; investments at the end of quarter were $47/share(longs=$1,039M, shorts=$681M; 36M shares). if einhorn can return to his historical rates of return, BV and investments/share can grow quickly. for example, a 15% return on investments over the next year would grow BV by $7/share assuming break even on the insurance business.

      full disclosure: i own shares.

      • 1 Reply to bsuryn
      • thanks--i agree--seems to me that the stock is really a good long short hedge fund investment with an interesting well managed reinsurance company thrown in for free.

        what doesnt make sense to me tho is why the stock is underperforming the value of the underlying investments (ie the hedge fund) when the reinsurance co is doing well and improving.

        thats why i asked if there's any other variable i'm missing that influences the stock price

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