NWLI Was up 20% last year, so much better than the market. Off to a weak start this year, but probably just following the market with some profit taking from last year's win. I think we have another market beating year in 2015.
But good luck - hope it works out for you
I agree. Mine too. Plus, there is a reasonable chance rates finally rise this year, which would provide a tailwind for the lifeco's.
NWLI hasn't gotten into trouble with their bond portfolio since I've been following it for the last 10 years. They are very diversified and conservative. I guess if it was going to happen though, it would make sense that would be with the energy companies given NWLI's Texas location. But I really, really don't think it will turn into an issue for them.
Market even recognized it and bounced when earnings came out.
The volume has actually been good (for NWLI) in this latest uptrend the last month.
Perhaps these 2 factors are showing the market is getting more interested in our well-run, value stock.
Could be a lot of reasons and you'll never know.
Could be a fund building a big position; could be sentiment changing on interest rates; could be someone trading out of a more expensive insurer; could be a persistent seller is finished; could be some inside news on earnings or a takeover (unlikely but possible)
I think the thing to focus on is it is an inexpensive, well run company in a market where there are fewer and fewer of these, so the price generally should go up.
If you've priced your insurance based on those rates, then it absolutely makes sense. N o-one know for sure what rates will do and NWLI is in the business of making money on insurance and not on speculating on interest rates.
I believe it is more the Ebola scare making investors think air traffic drops and hurts stocks like FLY.
Look at stocks like DAL for example.
It's still important to recognize this, especially when looking at the relative value of lifeco's.
KCLI for example trades at a p/b of .65, but really is .69 when you strip out AOCI, so at a 13% premium to NWLI. And this is for a less quality company with lower ROE.
Even at the current price, buying back stock makes a lot of sense.
Best for long term holder would be to continue to buy back stock as long as it a big discount to book and then implement a dividend.
We had a company up in Canada EVT.TO which was basically the holding company for a guy named Hal Jackman. They paid a paltry $0.15 for years and no-one did anything about it.
Hal retired and the son took over and changed the dividend policy to basically distribute all earnings to shareholders, which is much better.
Jackman is 4 years older than Moody, so there is hope!
I think Ross was selling because it is a time-dated fund and he needs to start raising cash. He's also been selling in OCN for the same reason (according to press releases).
BTIG Research (google them, I can't post links in the message board) has been doing a really good job of following the bond market and likes AGO and has some good reports about their exposure, etc. You need to create an account, but it is free.
The way I look at it is they cleaned up Alabama, Stockton, Detroit with very few losses (extending terms, refinancing, etc) and Peurto Rico should be similar. They have a lot of excess equity, so could easily handle some losses here if needed.
Pure vanilla insurance and annuity company.
Read their SEC filings - they detail their business and the expected yield on their outstanding bond portfolio.
Of if you really want to dig in, read their insurance statutory filings. They have the full gory details.
chiefned, NWLI has a controlling shareholder who does not want to sell, so no comparison.
dsouth, NWLI is making good profit with low rates. Higher rates, assuming they come, will only help, but even without these, the business is good.
NIce writeup on seeking alpha. Nothing really new for most of here, but hopefully will get some more attention for the stock:
Forbes also recommended ORI recently with an article titled:
Old Republic International Named Top Dividend Stock With Insider Buying and 4.36% Yield (ORI)
So, it appears, after year of getting things in order in obscurity, the mainstream media is starting to recognize ORI. Still about 25% undervalued compared to its peers on yield, p/e, p/s basis, so this could give the push to the next level.
The one thing I noticed in the quarterly this month was the lawsuit with the $!50 million in exemplary damages was denied review by the Supreme Court and is now completely over. SO, even though the odds of anything close to this actually being paid were very small, it is still nice to have the risk completely gone.
Thanks for the update. Good work on the Amazon short - that's been a tough one to get the timing right.
My thought is we are going through a mid-cycle slowdown, which could last 1 quarter or several quarters. This will be followed by rising rates and an economic re-acceleration. The stocks we will want to own during this period will not be the mo-mo stocks of 2013, but larger, value oriented stocks and late cycle stocks like energy and other commodities. We'll see as every cycle is different, but to me, it seems we are more in a period of rotation than the end of the bull run.
Sent this message over to David Merkel and he replied on seekingalpha. David is an ex-actuary and now fund manager who is the smartest insurance investor I know and he likes NWLI still.
DOsn't seem like you can post links here, but go take a look.