Recent

% | $
Quotes you view appear here for quick access.

Barrett Business Services Inc. Message Board

hearnthar 21 posts  |  Last Activity: Feb 16, 2015 11:15 AM Member since: Apr 13, 2007
SortNewest  |  Oldest  |  Highest Rated Expand all messages
  • Reply to

    Challenge to hearnthar

    by giving_is_easy Feb 12, 2015 9:09 AM
    hearnthar hearnthar Feb 16, 2015 11:15 AM Flag

    I did outline the facts from published information and logical conclusions from that. I do not have insider information, but if you do, to rebut any of the summary I outlined, please feel free. I have followed workers compensation carriers for many years and have seen the signs and that is what I warn about, whether an official insurance company or a company that acts like an insurance company, but does not have the surplus that is required of an insurance company. (lets face it, the biggest glaring fact is that if this was a "real" insurance company, the statutory surplus would be below zero and this would have been received many years ago--that is an absolute fact.) As I have said in the past, I am most concerned about the injured workers and on a going forward basis this is fixed, but I do feel bad for those who insured with this organization will not get their "premium" back, but will be responsible to pay the claims (or reimburse the self insured guaranty fund.)

  • Reply to

    Challenge to hearnthar

    by giving_is_easy Feb 12, 2015 9:09 AM
    hearnthar hearnthar Feb 12, 2015 4:00 PM Flag

    So you think it is not true? The big deal was to get their workers compensation moved from their self insured plan (because CA regulators were concerned that the self insurance fund could not handle an insolvency of a large PEO). Their financial difficulties and the reason they needed to go get bank loans (secured by their cash) and LOC's was to get to just the minimum required by the state--for workers compensation. You can ask any commercial insurance broker in CA who do you put your hard to place business with at the lowest rates. It is BBSI. They are at all the Insurance functions touting their prices. When you ask them why they can write their business for less than half the insurance industry, the answer is always something like we do claims better than anyone else. These are just observations. If you are asking me to hack into their books (they are quite secretive), I will not do that. I can only observe.

  • Reply to

    Value of BBSI?

    by hearnthar Feb 11, 2015 7:14 PM
    hearnthar hearnthar Feb 12, 2015 3:46 PM Flag

    Agree with your second statement or so it seems.

  • hearnthar by hearnthar Feb 11, 2015 7:14 PM Flag

    So what is the value of BBSI. The market cap is $274.3 million. State book value is $38.6 million. Tangible net value is -9.2 million. Aggregate 5 years earnings is approximately zero. Current financial ratio is .82. Most cash is restricted due to their dire financial straits. Primary business is California workers compensation where they are by far the cheapest in the land. They "always" lose money in the first quarter of every year (last year it was 3.5 mil). There is uncertainty as to whether all their future WC liabilities are accounted for. So will growth of earnings in the near future be soooo much that this is worth this much more than stated? It has to be some mighty fast and extremely profitable growth. I have trouble believing this is even viable, much less a huge success. Maybe it is, but I just cannot see it by looking at the facts.

  • Reply to

    Here we go again

    by hearnthar Feb 3, 2015 4:55 PM
    hearnthar hearnthar Feb 9, 2015 10:58 AM Flag

    Huh? Is Covered CA paying the WC claims now?

  • Reply to

    Where are our friends?

    by motgi01 Feb 6, 2015 9:22 AM
    hearnthar hearnthar Feb 7, 2015 7:34 PM Flag

    I don't know any employees or ex employees of this company. Gruntled or dissed.

  • Reply to

    Here we go again

    by hearnthar Feb 3, 2015 4:55 PM
    hearnthar hearnthar Feb 5, 2015 12:43 PM Flag

    And believing that management now has this under control is not pure conjecture? I guess not. Based on their track record, I would have to agree. It is not conjecture, it is a stretch. But more power to you. I think you should increase your holdings and put everything you have into the company.

  • Reply to

    Here we go again

    by hearnthar Feb 3, 2015 4:55 PM
    hearnthar hearnthar Feb 4, 2015 1:56 PM Flag

    I really doubt they have their liabilities under control. It is really here we go again time.
    Under reserve as long as possible to keep this scheme going.

  • hearnthar by hearnthar Feb 3, 2015 4:55 PM Flag

    Interesting to note that they are still growing at a very rapid rate due to very low workers compensation "premiums" charged their clients. It appears that while their WC premium revenues are growing at a 20% rate, their increased accrual to paying claims only increased 12%. Last I heard, WC in CA was not improving, so there will, somewhere down the road be another "one time" increase in reserves. I think they always have a losing first quarter. Note that still their tangible net worth is still less than zero. It is apparent that their auditing firm did not make them write that off or down. I hope they have their E&O paid. And they have lots of it.

  • Reply to

    ACE

    by igoryashiboklikov Jan 20, 2015 9:11 AM
    hearnthar hearnthar Jan 23, 2015 2:23 PM Flag

    you do not have to agree, but he is not lying. it is not helpful for your own opinions to spout nonsense. If you have some facts, they can be helpful.

  • Reply to

    ACE

    by igoryashiboklikov Jan 20, 2015 9:11 AM
    hearnthar hearnthar Jan 23, 2015 2:07 PM Flag

    Things in the short term are certainly better for BBSI so long as they increase their workers compensation "premium" to clients (and retain the business) to not only cover the additional costs but cover the losses that did not go away simply because the dropped a huge expense charge. Fronting costs usually run the frontee around 7-10% of premium. They also are paying increased costs for the money they had to borrow. Most of the borrowed money is then tied up into collateral and cash deposits deals with both ACE and with the State of CA on their old plan. They also have additional expenses because they are insured. They need to report to Bureaus, boards etc so must purchase programming which can be costly. Also, they have to start paying premium tax. All of that adds up and they cannot absorb that without charging more. So this is going to be a major challenge for BBSI. They still have (in my opinion) large inadequacy of reserves on the old sii program where, if the company cannot pay, the "insureds" are on the hook. The good news on this fronted program, if BBSI cannot pay the ultimate bill (most likely outcome), the insurance company is on the hook. I think in the sort term, unless their independent audit company makes them write off their worthless goodwill and intangibles, the company is good to go for another 6 months and perhaps a year. 5 years from now, there will not be a BBSI. My opinion anyway.

  • Reply to

    strong buy

    by agrinberge Jan 2, 2015 2:07 PM
    hearnthar hearnthar Jan 8, 2015 10:44 AM Flag

    My opinion is this is a long term positive thing for AmTrust amid their buying companies. This should help protect their rating especially when the shoe drops sometime about their inadequate reserving of workers compensation, especially in CA.

  • Reply to

    Fosun to acquire MIG

    by donedoodit Dec 30, 2014 6:03 PM
    hearnthar hearnthar Jan 7, 2015 8:40 AM Flag

    Are you that law firm with the frivolous lawsuit? Anyone who knows anything about Meadowbrook knows this is a generous offer for a company under water. These lawsuits benefit only the lawyers.

  • Reply to

    2015

    by diewarheit Jan 2, 2015 11:07 AM
    hearnthar hearnthar Jan 5, 2015 4:13 PM Flag

    I also have a question related to financials. Will their auditing firm make them write down their goodwill according to proper accounting when the underlying value in the goodwill is not worth it? Note that they are loading up on debt, much of it secured and at a higher than average interest rate due to the risk, and their tangible equity is less than zero. Also, in the first quarter, they always take a loss, only this year will be larger than previous years. So long term viability? Only Wells Fargo is propping them up by increasing their debt and potential debt. Fortunately, for injured workers going forward, their claims must be paid by the deductible carrier (supposedly still ACE) if BBSI cannot pay. That is a big sign of relief going forward. Looking back it is still scary for those that were under the self insured program.

  • hearnthar hearnthar Jan 3, 2015 11:59 AM Flag

    Like 99% of "shareholder" lawsuits, this is a lawsuit that is filed to extract a quick settlement from management. They will pay the lawyers a couple million to go away and the shareholders will get nothing. The lawyers almost never share with the supposed wronged. They know that the lawsuits could drag out the sale and really hurt the company so they settle regardless of merit. The purchasing companies build these nuisance lawsuits into the purchase price as it is a cost of doing business in america.

  • Reply to

    2015

    by diewarheit Jan 2, 2015 11:07 AM
    hearnthar hearnthar Jan 2, 2015 1:29 PM Flag

    A couple clarifying thoughts: Since, in the last 5 years, they had no profit, the profit margin actually would not go down. However that is a point that has been hashed over a lot. I am sure BBSI has been transitioning their plans to insured from self insured as the expiration dates have come up, so the additional cost of the ACE large deductible plan has been gradually implemented and is now complete. They should start their first renewals as "insured" starting today. (or yesterday). Their other costs, such as real insurance reporting costs should have been started awhile back as it is mostly computer related. Unit statistical, policies to the bureau, etc. But if they have not started, they will be in a bind come July when they need to start spitting them out. I think Wells Fargo, gave them temporary new life, but in my opinion that will not last any longer than their 2 year commitment and they may go ti sooner.

  • Reply to

    Securing the future

    by hearnthar Dec 30, 2014 10:51 AM
    hearnthar hearnthar Dec 31, 2014 2:41 PM Flag

    Obviously. I assume ACE is also renewing tomorrow. No word on that and if it were possible it weren't true, then it would be material and would have been reported. I just look at this and for long term, as a workers comp insurer (as that is their primary business model), are the injured workers under their self insured plan going to be taken care of or are they getting the shaft?

  • hearnthar hearnthar Dec 31, 2014 2:30 PM Flag

    Now is too late. :)

  • hearnthar hearnthar Dec 31, 2014 10:07 AM Flag

    Really they should headline it: Law firm seeks distribution of wealth--to them.

  • Reply to

    Fosun to acquire MIG

    by donedoodit Dec 30, 2014 6:03 PM
    hearnthar hearnthar Dec 31, 2014 10:06 AM Flag

    Probably paid too much, but if that is what it takes for them to get more US business...

BBSI
42.16+0.690(+1.66%)Mar 27 4:00 PMEDT