Making posts is difficult while doing research. I've recently started posting because opportunities are lacking, resulting in LOTS of slack time.
My original thesis for purchase came about in the events as followed: 1) UFCS popped up on my screener, 2) Saw pictures of headquarters underwater, 3) Shares were trading between $16-$17 range while book value was $24; 4) Fixed income portfolio was under distress - HUGE opportunity for unrealized gains once the 2009 fiasco subsides, 5) Really appreciated the ceo's annual letters, and most importantly, the company's adamant stance on strict underwriting standards, 6) The company was repurchasing shares in my purchase range, 7) Insider ownership was fair
The shares were priced as if the hurricane permanently wiped UFCS away... creating a nice buying opportunity; moreover, the above variables were enough to make UFCS a 5% holding for me.
MIGP purchase was "okay". I guess the purchase had to be made at book value or the buyout probably would fall through. I was a little startled when I read in 2009 10-K, MIGP held 43% of fixed investments in municipals, but the most recent 10-Q shows approximately 31%.
However, given the nature of how overvalued fixed investments are trading presently, I'm afraid the fixed investment portfolio may be overvalued now.
I'm thinking the recent price declines is due to the municipal bond scare