Chaucer Hldgs Share Discussion Threads

[tullynessle] 23/9/2010 13:26

Full steam ahead for Chaucer
Thu 23 Sep 2010

Chaucer has outlined its plans for the launch of a new International Liability Division by the end of the year, following a series of appointments during the first half of 2010. The Division will fulfil the company's long-standing intention to develop its non-US liability business.

Article continues....

[johnny1982] 23/9/2010 09:48

Catlin being tipped left right and centre. Nothing here though.

[lionheart79] 20/9/2010 13:24

BRE news has made no impact on CHU it seems

[crawford] 18/9/2010 17:50

BRE takeover news late Friday - £11 bid.

Bound to rerate the whole sector - I would say we are high in the list for potential takeovers.

[deadly] 05/9/2010 19:51

Nice dose of director buying for the divi next week.

[jonwig] 02/9/2010 14:03

emundshaw - I was actually looking here for uncorrelated returns, but anyway ...

Look out for Earl - CHU has an exposure, but not, I think, a very large one.

[edmundshaw] 02/9/2010 13:43

In a recovered market (broad and specific) I see no reason why we can't return to prior profitability - and a 5p dividend. On today's price (well yesterday's perhaps) that's around 11% yield - as if 9% isn't enough! :)

[aleman] 02/9/2010 13:06

Keefe Bruyette & Woods Ltd MPER 30 Aug 2010
2009 42.00 6.60 4.00
2010 30.00 3.50 4.00
2011 41.00 5.70 4.00
2012 63.00 7.90 4.40

Numis Securities Ltd ADD 27 Aug 2010
2009 42.00 6.10 4.00
2010 35.40 4.50 4.00
2011 53.10 6.70 4.00

[edmundshaw] 31/8/2010 08:36

"As previously announced, in the absence of unforeseen events, we intend to a pay a minimum total dividend of 4.0p per share for 2010."

In the absence of unforeseen event, it would appear that the divi will not be cut going forward. Unless you don't trust management to tell it like it is.

[effortless cool] 30/8/2010 16:34

It would not appear anything of the sort. If you don't understand that insurance results are volatile, you would be better not to trade these at all.

I think a cut is unlikely but don't expect any/much growth either.

[salpara111] 30/8/2010 15:45

It would appear that the divi will now be cut going forward so it is probably better to not think in terms of a 4p divi. They only made 0.9p but are paying out 1.3p that is not sustainable.

I have traded these before but will not look again until it cycles back down to 40/41.

[effortless cool] 27/8/2010 12:04

hm,

There is certainly much dependence on investment return due to the size of the float relative to the size of the company. They've now taken nearly all risk out of the investment portfolio (to the extent you can). This means current returns are pitiful, but there is much reduced exposure to another crisis. (In fact, those holding mainly treasuries made big profits from the crisis in 2008).

Equity Red Star has suffered due to massive underreserving, as did KGM. I was pleased to see that Chaucer did not follow suit. Due to these and other issues, it does look as though motor underwrting is finally going to enter a phase of profitability, regardless of investment returns. Rates in almost all other classes, by contrast, are going the wrong way.

[harleymaxwell] 27/8/2010 11:49

seems like a lot of dependence on investment return - irrespective of underwriting profit
as the financial crisis materialized this return would clearly start to diminish so make sense to reduce in those classes of business that rely more on investment income to make a profit eg motor

this i think is why equity red star and maybe chaucer to a degree have suffered more than others because of overweight in UK motor biz?


anyone have any views

[effortless cool] 27/8/2010 08:08

jonwig,

Stupidly cheap at less than 90% of NTA imho. Interims unspectacular, but still delivering a return above the risk-free rate on NTA, even in a year with poor relatively underwriting results, in soft market, with interest rates very low.

Yes, a cat event could wipe out that discount, but the stock market is already anticipating that. And a market result on that scale would probably turn the cycle anyway, incraesing expected future profits.

[lord gnome] 26/8/2010 14:54

And where exactly did you suddenly spring from rainfall?
35p? Yes please, I'll double up.

[rainfall] 26/8/2010 14:39

sell get out before 35p

[jonwig] 26/8/2010 14:24

EC - I respect your views on GenIns (you know and understand a lot more about it than I do) but I'd be interested in just *why* it's currently undervalued.

My own investment case was that I viewed the UK motor sector as one where they would, at last, begin to make money (Quinn, etc. bankrupt) but even that seems to be developing too slowly. Legislation would be a big plus, but there doesn't seem to be a will to crush the great mass of uninsured vehicles.

On catastrophe, as I posted above, the results seem to be 'in-line' hence the negligible effect on the share price today. At least with GenIns, you get enough prior warning of the big losses!

There's a discount to NAV, which ought to be either a buffer for the divi or a prod to a predator, but that can disappear quickly if the events go against us.

[effortless cool] 26/8/2010 13:53

Notwithstanding my comments above, stil stupidly undervalued imho

[effortless cool] 26/8/2010 13:50

ursus - combined ratio excluding motor = 103%.

Does that answer your question?

[asagi] 26/8/2010 13:45

I'll add Novae to Effortless Cool's list:

Combined ratios for 2010 H1

AML 88%
BEZ 89%
HSX 95%
BRE 97%
CGL 97%
NVA 101%
HDU 102%
CHU 105%

Asagi (long NVA, long CHU)

[ursus] 26/8/2010 13:39

the events are foreseen, you silly old queen: they are the subject matter of the insurance. but their incidence is not.
coolie -- higher cr because motor book larger proportionally than for the other ilv's?

[boadicea] 26/8/2010 11:05

".... in the absence of unforeseen events, we intend to a pay a minimum total dividend of 4.0p per share for 2010".

A strange turn of phrase for an Insurance company, as "in the absence of unforeseen events" they wouldn't have a business!
Still, nice to know that we can expect an 8.8% yield at 45.5p.

[harleymaxwell] 26/8/2010 10:59

combined ratio is combination of losses and expenses dont forget so contributions may vary although result is still the same

i guess the question is whether the weightings are right across the different types of business accepted ie too much motor perhaps when investment returns are low is probably not a good idea

[edmundshaw] 26/8/2010 09:13

I think CHU more exposed to all 3 than the 2 I've looked at in detail.

[effortless cool] 26/8/2010 09:12

jonwig - the same disasters as everyone else, but ...

Combined ratios for 2010 H1

AML 88%
BEZ 89%
HSX 95%
BRE 97%
CGL 97%
HDU 102%
CHU 105%