How To Analyze Insurance Stocks | Fairfax Analysis
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- เผยแพร่เมื่อ 4 ก.ค. 2024
- Tickernomics: tickernomics.com/#
Email: Investingsucks@gmail.com
0:00 Intro
1:02 The Insurance Business Model
4:03 Cost Efficiency
5:40 Brand Recognition/Customer Loyalty
6:12 Financial Stability and Risk
9:08 Prudent Management
11:28 P&C Valuation Differences
12:39 Analyzing Historical Results
15:46 Fairfax Analysis
This video is not intended to be financial advice. Do not make any investing decisions based solely on the contents of this video. - บันเทิง
Interesting video.
There is a reason no one talks about Insurance firms in a valuation setting. They are immensely complex. They also are regulated under SAP reporting, not GAAP reporting. SAP uses capital and surplus. GAAP uses book value. Somewhat the same concept, except major differences in assessed values and tolerances. SAP is keyed in on solvency and policyholders' position of immediate need. GAAP is more street value. Revenue reporting, expensing, deferred tax assets, goodwill, are all different. I'm not even sure what street value(book) is good for when a M&A has to pass SAP guidelines.
If you are looking for a valuation guide, the NAIC has material that would help. Mainly the IRIS ratios, RBC(risk based capital) formula, and there are other materials and guides that are for sale. Even just using the IRIS ratios will tell you how strong an insurance company is in regards to future growth.
It was interesting to see the scatter-plot show correlation in the book value.
Thanks. Will look at intact from this!
I love your channel!
I learnt quite a lot about the sector. Thank you for the value
Some thoughts on BHG Bright Health Group? Anyone? Completely new to insurance companies valuation. Would love to get someones opinion.
I appreciate the video. I wanted to know how one determines how effective an insurance company is at underwriting specifically from public financial statements?
Return on equity is a good barometer. Especially if it's been consistently high
smart guy
How to value oil companies?
Thanks for covering this hella complex sector. Too nuanced for a newbie to analyze accurately 😉. It appears Fairfax's modus operandi (highlighted in video) are focused on increasing company/shareholder value (aside from Micheal Burry style short positions that didn't pay off). Am I understanding correctly?
Pretty much. They've made some smart bets over the years but have also made some ill-timed ones
@@investingsucks hmmmm. Makes me question if it's business savvy or pure luck 🤔? They seem to have gambled correctly on the current macro environment. A wild ride to be sure.
Blue owl capital.