time to head off, so, my closing thoughts...

Howdi,

So,

All statements in this post constitute what I BELIEVE to be true, but, I do admit there is always a chance that I have made a mistake. As such, i recommend that you do your own research.

With that out of the way, after looking at QBE for a period of time, I have decided it is no longer particularly high on my watchlist. I thus don't expect to hang around here any longer... but thought I would give my departing thoughts.

1.
MorningStar forecasts negative earnings growth this year and next year.

2.
MorningStar has downgraded expectations in the last 30 days.

3.
The $500M lawsuit is somewhat troubling.

4.
Most analysts expect the AUD to rise.

5.
Dividend yield is, IMHO, low.

6.
Per http://news.ninemsn.com.au/mobile/business/925773/qbe-cuts-insurance-revenue-forecast?_sp=2045&_s=a2fc4b91-f0d0-44e6-8696-0e18c931c576 , "Gross written premium (GWP), a benchmark measure of insurance businesses, is now expected to rise 10 per cent to $14.4 billion in calendar 2009, rather than the previously forecast $16.2 billion, from $13.1 billion in 2008." (Though, I admit "In local currency terms, the GWP outlook was little changed from the targets set in the company's annual report in February." But, think that's fairly immaterial if USD keeps dropping).

7.
The amount of short-sales is slightly higher than I would like. It's not massive, but, it's certainly not good!

8.
Minor point (I largely avoid Tech.Analysis)... but, it seems 'stuck' in a very flat trend... nothing screams to me that it needs to increase in price.


9.
I expect a higher return on investment than I expect from QBE. This point is irrelevant for thus that expect a lower return than I do.... but.


I do note that QBE *may* increase in price, partially due to a very low P/E ratio of under 12. But, here is the average P/E ratios since 2003.
11.9
11.6
12.3
12.7
14.6
12.1
And, so a current P/E ratio of approximately 11.9 isn't abnormal for this stock.... As such, there is no reason that the P/E ratio *has* to rise. It may very well. In fact, one day, I would VERY MUCH expect it to. That just doesn't mean it'll happen within 2.5 years, my investment horizon.

My position is a very moderate-sell.