Ann: QBE December 2020 Market Update Presentation, page-12

You may well be right, mickeebee. I am in at $7.38, so have room for a little patience.

I look across the ASX200 and wince at loser after loser sittin' on fancy multiples only because there is a Covid-subsidy wall of money competing for yield, any yield better than bank non-interest.

I asked the better question: who in this environment has genuine pricing power?

I see food, base and precious metals and, surprisingly, insurance.

Last week's announcement by QBE foreshadowing a $1.5b loss holds the germ of this, with premium prices up 9%. I anticipated 6% and am most encouraged.

Pushing through premium rises of this size takes courage and discipline. Rival insurers competing on price and underbidding will sorely rue their foolishness and the capital erasure ahead. I note noomix's observation above running costs still need to be met even if the insurance book shrinks.

The analysts post-announcement remain more positive than Mr Market:

QBE Insurance Price Target Cut 9.8% to A$11.50/Share by Morgan Stanley. 21/12/2020 9:47AM. No story, headline only

QBE Insurance Price Target Cut 14% to A$9.50/Share by Bell Potter. 21/12/2020 9:40AM. No story, headline only

QBE Insurance Price Target Cut 7.7% to A$10.67/Share by Goldman Sachs. 21/12/2020 9:32AM. No story, headline only

The QBE share price has been falling for 13 years. I am betting it will now turn. We shall see.

DYOR!!!!!!!!!!!!!!!!!!!!!

Ash