Tripled my position in Assured Guarantee yesterday at $13.89 (AGO). They won a key lawsuit last week and it is seeming to be ignored, but I think it really helps in their lawsuits against the big banks.
Wilbur Ross, who's worth about $2 billion from investing, has about a quarter of his portfolio in it and this summer called it "probably the best risk/reward position in my entire portfolio,".
Pays 2.5% dividend, trades at 58% of book value and about 25% of book value adjusted for prepaid premiums. Made money all through the housing crisis whereas competitors mostly got into serious trouble, so they have very little competition other than a new muni-insurer being set up by White Mountain Insurance (another very well run company, but small, but still show they see the potential in this business). They are buying back lots of stock and could close the doors and go into runoff and the stock would probably be worth at least 50% more than it is now.
3Q:12 Preview – Rates and Capital Return Expect focus on interest rates and capital return outlook We expect to see 3Q:12 DAC charges related to interest rates, which could be partially offset by impact of higher equity markets. PRU will provide 2013 EPS guidance, but will do so near the end of earnings season. Our current estimate is $7.70, or an ROE of ~12% (see more detail below). We are cautious on MET and PRU commentary around 2013 capital return given uncertainty around possible non-bank SIFI designation and related rules. We are generally below consensus for the group Our 3Q:12 EPS estimates are 1% below consensus for the median company. For full year 2012 and 2013, we are also 1% below consensus. Excluding pre-announced items not yet reflected in consensus, we are most below for GNW and SFG. We continue to favor BVPS growth – LNC, AMP, and UNM preferred We feel the current interest rate environment will pressure the sector’s ability to generate ROE improvement. As such, we are not optimistic that the sector will see material P/B multiple expansion. Therefore, we feel investors should favor BVPS growth, driven by sizeable capital return in the form of share buybacks. In this regard, we favor LNC, AMP, and UNM, where we see 2013 buybacks at 7-11% of current market capitalization. Valuation Methodology We value large cap life insurers using: 1) a historical analysis of forecasted ROE vs. COE and 2) relative P/E targets. We value AMP & PFG using sum-of-the-parts
Hulbert negative on the market in Barron's (Google "Is the Bull Market Long in the Tooth?").
Still think too much emphasis on the CAPE is hurting investors due to inclusion of the huge bank writedowns in the financial crisis which are non-recurring (at least hopefully!).
How far in advance of earnings should shareholders possibly expect guidance, anyway? Hours, it seems.
I would want an internal plant monitoring fab activity, if I could locate one.
Otherwise, device dealers probably have a good idea of what's moving off their shelves.
I sure wish I knew what was going on inside AMD and INTC these days, those ARM devices seem to be putting a squeeze on the big, traditional processors. Unbelievable INTC doesn't have a robust plan, their marketing group is the very best, I would expect them to stay well ahead of the market.
i still find it impressive that YRCW hasn't pulled down below the 38.2% retracement level of its move off the early August lows. last week the range was the lowest it has ever been for the stock as the stock bases for 4 weeks now. after these basing patterns the move can be extremely violent. given that the stock is down about 99.99999% from highs, trades at 0.01 times sales, throw in some insider buying, 1st operating profit in 4+ years, and a CEO that seems confident of a turnaround, i'd say the move out of this base is ultimately significantly higher.
Lots of debt still, negative equity, analysts predicting a loss of $23 this year, $12 next year.
Do you know how they got themselves into such a mess and what is changing now to get things going? I agree this is the best time to buy if they are really turning the corner.
LNC is down 4% in the last four days versus 2% SP500, how the world has changed. Kinda of like this one as I owned it for most of AUG when I left for the East Coast and recently sold at 25 four days ago. It too is sitting on the 50 dma.
May buy both LNC and AGO before the days out its just the mkt feels like it wants to go lower.
For you coal fans CLF pays a 6% divy, not much interest to this group.
Wilbur Ross two other favs IRE and XCO, I think TOF had traded IRE in the past, any thoughts onit now?
I guarantee Biden loses the debate tonight. Mainly because the debate is tomorrow night.
I agree with Walmart managing the country, but only if they pay Congress what they pay their employees and they go back to selling everything made in America. Oh, and congress gets the same healthcare benefits and retirements as Walmart employees. Then it would be a no brainer.
Nikkei pulls back another -1.65%.
ReplyDeleteAA taking a beating.
ReplyDeleteAA - Looks buyers showed up at $8.77, my bid was $8.75
ReplyDeleteChanged to $8.50, in consideration for the gap up early Sept.
DeleteI'm just not in a buying mood this morning.
ReplyDeleteTripled my position in Assured Guarantee yesterday at $13.89 (AGO). They won a key lawsuit last week and it is seeming to be ignored, but I think it really helps in their lawsuits against the big banks.
ReplyDeleteWilbur Ross, who's worth about $2 billion from investing, has about a quarter of his portfolio in it and this summer called it "probably the best risk/reward position in my entire portfolio,".
Pays 2.5% dividend, trades at 58% of book value and about 25% of book value adjusted for prepaid premiums. Made money all through the housing crisis whereas competitors mostly got into serious trouble, so they have very little competition other than a new muni-insurer being set up by White Mountain Insurance (another very well run company, but small, but still show they see the potential in this business). They are buying back lots of stock and could close the doors and go into runoff and the stock would probably be worth at least 50% more than it is now.
AGO looks like a pretty safe bet.
Deleteper UBS fwiw
Delete3Q:12 Preview – Rates and Capital Return
Expect focus on interest rates and capital return outlook We expect to see 3Q:12 DAC charges related to interest rates, which could be partially
offset by impact of higher equity markets. PRU will provide 2013 EPS guidance, but will do so near the end of earnings season. Our current estimate is
$7.70, or an ROE of ~12% (see more detail below). We are cautious on MET and PRU commentary around 2013 capital return given uncertainty
around possible non-bank SIFI designation and related rules.
We are generally below consensus for the group Our 3Q:12 EPS estimates are 1% below consensus for the median company. For full year 2012
and 2013, we are also 1% below consensus. Excluding pre-announced items not yet reflected in consensus, we are most below for GNW and SFG.
We continue to favor BVPS growth – LNC, AMP, and UNM preferred We feel the current interest rate environment will pressure the sector’s ability
to generate ROE improvement. As such, we are not optimistic that the sector will see material P/B multiple expansion. Therefore, we feel investors
should favor BVPS growth, driven by sizeable capital return in the form of share buybacks. In this regard, we favor LNC, AMP, and UNM, where we
see 2013 buybacks at 7-11% of current market capitalization.
Valuation Methodology We value large cap life insurers using: 1) a historical analysis of forecasted ROE vs. COE and 2) relative P/E targets. We
value AMP & PFG using sum-of-the-parts
AGO, decent chart pattern, daily and sitting on 50dma.
DeleteNice. I'm in @ $13.88
DeleteWhat I still don't get is why a company like PRU has a 12% ROE, but only trades at a P/E of 7.
DeleteEither something really bad has to happen to interest rates or these lifeco's or they are great long term buys.
"3Q:12 Preview – Rates and Capital Return"
DeletePerhaps this is impacting REIT's? NLY is getting trounced.
Marketwatch must have scared the ---- out of a few readers> it briefly displayed -154 for the DJIA/ -57 for the NDQ. Math error.
ReplyDeleteIt may have been a premonitory flash.
DeleteBAH - Bidding $10.77 GTC
ReplyDeleteChanged to $8.77 due to May gap up.
DeleteHulbert negative on the market in Barron's (Google "Is the Bull Market Long in the Tooth?").
ReplyDeleteStill think too much emphasis on the CAPE is hurting investors due to inclusion of the huge bank writedowns in the financial crisis which are non-recurring (at least hopefully!).
OCZ- That's the proper way to guide investors.
ReplyDeletei wonder if that spills over into FIO. i still think there's a dump coming in FIO.
DeleteHow far in advance of earnings should shareholders possibly expect guidance, anyway? Hours, it seems.
DeleteI would want an internal plant monitoring fab activity, if I could locate one.
Otherwise, device dealers probably have a good idea of what's moving off their shelves.
I sure wish I knew what was going on inside AMD and INTC these days, those ARM devices seem to be putting a squeeze on the big, traditional processors. Unbelievable INTC doesn't have a robust plan, their marketing group is the very best, I would expect them to stay well ahead of the market.
I think IWM is a buy...considered buying a few options yesterday. oh well.
ReplyDeletecoals raking it.
ReplyDeleteCoal's Feet firmly planted in Mr. Romney's neighborhood, when does Big Bird come swooping into camp?
DeleteI agree on IWM, QLD as well.
i still find it impressive that YRCW hasn't pulled down below the 38.2% retracement level of its move off the early August lows. last week the range was the lowest it has ever been for the stock as the stock bases for 4 weeks now. after these basing patterns the move can be extremely violent. given that the stock is down about 99.99999% from highs, trades at 0.01 times sales, throw in some insider buying, 1st operating profit in 4+ years, and a CEO that seems confident of a turnaround, i'd say the move out of this base is ultimately significantly higher.
ReplyDeletejust sitting and waiting.
Lots of debt still, negative equity, analysts predicting a loss of $23 this year, $12 next year.
DeleteDo you know how they got themselves into such a mess and what is changing now to get things going? I agree this is the best time to buy if they are really turning the corner.
look at that move in FDX today. i think the transports have completed their 14 month consolidation period. a move higher is in the cards.
ReplyDeleteLNC is down 4% in the last four days versus 2% SP500, how the world has changed. Kinda of like this one as I owned it for most of AUG when I left for the East Coast and recently sold at 25 four days ago. It too is sitting on the 50 dma.
ReplyDeleteMay buy both LNC and AGO before the days out its just the mkt feels like it wants to go lower.
For you coal fans CLF pays a 6% divy, not much interest to this group.
Wilbur Ross two other favs IRE and XCO, I think TOF had traded IRE in the past, any thoughts onit now?
AA just hit your target, bro.
ReplyDelete$8.55 Sept/6 gap needs to close IMO, need to pull this anchor out of the mud.
DeleteNote that oil rose yesterday and again today, supporting TOF's belief concerning transports? Any other reasons, something going on in Middle East?
probably dumb but i went long aapl puts again. $645 strike expiring on friday. long at $7 for a day trade.
ReplyDeleteSold at $7.9
Deletehttp://www.ritholtz.com/blog/2012/10/1030-james-oshaughnessy/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+TheBigPicture+%28The+Big+Picture%29
ReplyDeleteWhat works on wall street
Long IWM $82 calls at $0.68. Support at 50 DMA right below current price. I think it bounces here.
ReplyDeleteturnaround wednesday.
Deletecashed those in at 0.78
DeleteNLY - Nearly bought a boatload at $16.06, chickened out.
ReplyDeleteNow I get it, this must be the reaction to a presidential candidate saying the housing market should be allowed to crash.
DeleteSuperpack App - Hold your smart phone to the TV screen and scan the political commercial to filter/determine the BS level.
ReplyDeleteIt turned my smart phone brown. I think that's a BS limit. The Romney add made it squishy.
DeleteBack in the AAPL puts...$645 at $9.18 avg.
ReplyDeleteSold at $8.2 doh
DeleteA basket of bruised apples?
Deletebound to give some of those day trading gains back...alright back to work. later fellas!
DeleteNSPH right back to that critical .16 level. Maybe we will get that opp. soon.
ReplyDeleteYeah, who knows.
DeleteOh boy, just can't wait to watch as Biden chokes tonight... Have to admit, this strategy seems counterproductive and is getting kinda old.
ReplyDeleteWal-Mart should be hired to run the economy.
You probably have something there. As I recall, Wal-mart and Home Depot did a much better job of responding to hurricane Katrina than FEMA did.
DeleteI guarantee Biden loses the debate tonight. Mainly because the debate is tomorrow night.
ReplyDeleteI agree with Walmart managing the country, but only if they pay Congress what they pay their employees and they go back to selling everything made in America. Oh, and congress gets the same healthcare benefits and retirements as Walmart employees. Then it would be a no brainer.
"Then it would be a no brainer." Here we would say, "Then that would be a Biden."
Delete"the debate is tomorrow night."
DeleteI always forget you're on West Coast time! ;)
Is it Thursday in Texas? I mean, it's a big state and all but....LOL!
DeleteI Goggled the debate before I commented, just because I wasn't paying that close attention.
They say Thursday Oct. 11. But you can't believe everything you read on the inter-nets.
Part of my problem could be Goggling when I should Google.
DeleteYou refuse to let me off the hook, huh? I though it sounded like a good enough excuse....
DeleteBesides, this kind of logic is in line with the PBS Big Bird theme, Mr. Romney's Neighborhood, and Joe Biden's world.
DeleteWon't you be my neighbor?
If MITK keeps hiring, how the hell are they ever going to make any money?
ReplyDeleteEventually they hire someone who knows how to monetize? Could it be just a good-buddies club sponsored by unaware shareholders?
DeleteYeah, it's looking like an option pump for insiders.
DeleteARNA - Well, I guess this formation should be called a bull flag breakout. Short float seems extreme, what could they know?
ReplyDeleteNew obesity drug.
Beige book - Housing market buoying the economy.
ReplyDeleteOpening RYEUX at the close.
ReplyDeleteHmmmm....maybe I'll close my QQQ short. FXE has been holding and UUP is weakening. Time for more 'we rescued the Euro' headlines?
DeleteMy suspicion is the S&P bounces at the 50 DMA.
DeleteWhich, coincidently, is the 9/26 swing low.
DeleteNo need to close any shorts, IMO. I'm just betting on a dead cat bounce.
DeleteI've witnessed the power of the 2nd ave. internal sentiment device.
DeletePut those shorts back on somewhere north of 1700...?!?!?
DeleteI'm taking this trade with you using ABB, pretty much same chart pattern as RYEUX, but I'm not locked in to eod.
Delete.50 retrace was at 18.67 which was an area of interest and touching the 50 dma.
A few down days beg for a headline/news driven ST rally, only to be shorted again.
ReplyDeleteI don't know man, Obama kinda looked like he may have been wearing a shit-eating grin....
DeleteI guess you guys out on the West Coast won't find out for sure until tomorrow night.... ;)
DeleteAdded some more YRCW at $6.5 to 6.55 into the close.
ReplyDeleteNSPH - Retired Senior J&J Executive Appointed to BOD:
ReplyDeletehttp://finance.yahoo.com/news/nanosphere-inc-appoints-roy-n-211500017.html
new post
ReplyDelete