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CNA Financial Corporation Message Board

  • thosehayden thosehayden Nov 12, 2003 7:32 AM Flag

    Lets see their Book Value declines

    by $8, so they have a new book value of $35.

    So CNA is trading at .6 times Book Value, still very cheap.

    Grand Daddy Loews is going to kick in 1.4 billion, which probably make sure don't lose their ratings.

    If you take out all of the charges they earned 30 cents a share.

    The stock will probably be weak today, but if management can convince everyone that this is it, all the charges are included ~ nothing else around the corner, then this is probably the bottom.

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    • 1.7B Loews to the rescue. It reminds me of a dealer supporting a crackhead. After a while you gotsta payback. I think CNA is in for a big buttkicking. Time for the toughlove.

      • 1 Reply to helpcna
      • Two things are particularly disturbing.

        First, roughly two-thirds of the reserve increase is attributed to core business, with the remainder added to asbestos reserves. This means that the current business was significantly more underpriced than the company thought when it was renewing it over the past 2-3 years, which suggests that the current business is likely not as profitable as it is being reported. Look for further adverse development in future earnings reports.

        Second, let's take the idiot's view, that, absent the charges, the company earned $0.30 (If Mom had balls, she might have been my dad): Annualize this and you get a whopping $1.20 per share, on a book value of about $35, for a return on equity of 3.4%. Truly astounding for a company that is in its industry's upcycle. What happens in the downcycle?

        Hey buccayew! How's THIS for "perverted reality?"

    • problem is- why would ANYONE trust mgt assertions?

      mgt will say that everyhting is rosy now, things look great, huge profits going forward- but they've sid that before- and just lost $7.94! how many years of earnings just went away?

    • and PMACA, and ACAP? what p/b do they trade at? at little less than .6, I'm thinking.....

      • 1 Reply to slocum3a
      • If it wasn't for LTR that is kicking in another $1 Billion plus...this company would be in run-off....(like PMCA that is no longer writing new business).

        Assuming reserves are now adequate, (they were reviewed by a number of independent entities), this company still has a substantial $8.4 Billion P&C Business...

        Going forward they say they'll be nicely profitable with loss ratios in the 90s...

        I believe them...Hopefully this nightmare is over...

    • I doubt any rational investor will believe anything positive about this insurer's loss reserves given the underwriter's track record.

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