Everyone is probably depressed looking at the current price of QBE. Here are some points to feel good about..sourced from the website seekingalpha.com
1) QBE has $5.25 of cash and investments per share after removing debt. QBE earned $ 0.762 a share in the first 6 months of last FY... This was significantly better than the prior result of .422 per share. Free cash flow also vastly improved , attaining $1.26 per share by operating activities. Annualized, that worked out to be $2.52 per share, or a 20% return on equity.
2) despite seven acquisitions last year and an over $700 million deal to buy an insurance portfolio from Bank of America, the insurers balance sheet is still very healthy and has room for more acquisitions. QBE said it has more than a $ 2.2 billion in excess capital and can raise up to $1.2 billion in additional debt giving more than enough firepower to continue with its M&A deals
3) Total premiums earned increased 12% in the first six months of last year and 3.9% compared to the yearend numbers of 2009. That is a great sign when just after coverage of a great flood and two major earthquakes, the companycan still forecast profits to grow by about 30 percent in 2011
4) Eventually when rates rise ( so 2013 +...) A one percent overall increase in interest rate would add 2.8 percent to insurance profit margin and $280 million to profit after tax.
This is the kind of stock.....you want to buy and forget yuo own it....
QBE Price at posting:
$13.30 Sentiment: LT Buy Disclosure: Held
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