Gable Hldgs Share Discussion Threads

[glasshalfull] 20/8/2015 23:20

finnCap provided a brief update following Monday's trading update,


"The interims due 10 September will provide an opportunity for the group to update the market on trading. The shares have been weak following comment in the finals that the group was exploring routes to meet the requirements of Solvency 11. Concern over a potentially dilutive equity raise encouraged the share price to retreat to below NAV. This morning’s news is that the group has announced that any moves on solvency capital will not result in an approach to the market. Gable continues to strengthen reserves, and feeding in new lines of business such as the Italian motor fleet business will sustain momentum. We see the current share price at a low point, therefore offering a buying opportunity. Market expectations for the current year profit are modest in the light of current reserving actions but an earnings recovery is anticipated for 2016."


I'm not aware of finnCap's estimates in light of 2014 results, but believe the last forecasts from Numis prior to the Zeus switch indicated that GAH would deliver 7p EPS for 2016, on assumption that the actuarial reserve gap would be closed in 2015, & that a 2.0p dividend was also mooted next year.

Kind regards,
GHF

[adyfc] 20/8/2015 17:23

Expecting these to continue down to 14p.......

[battlebus2] 20/8/2015 08:02

Expecting these to continue upwards to around 40p.....

[battlebus2] 19/8/2015 17:42

A positive finish to the day can't be bad given current market sentiment....

[battlebus2] 19/8/2015 08:31

Looks like a bit of profit taking this morning.

[rathlindri] 18/8/2015 23:18

the "multipandol" approach would appear to be the best policy here then?

[garbetklb] 18/8/2015 22:52

Simon

In long tail insurance it's a very brave man to say that events "clearly have not" occurred.

Events could well have happened that GAH are unaware of - In the UK an injured person has 3 years in which to notify a claim (longer in some cases) and if the injured person is a child, they have 3 years from when they reach 18 - although GAH will probably have few, if any, claims in respect of children. I don't know the limitation rules in respect of all the territories that GAH write in - that could be an interesting question in a meeting.

They are also likely to have claims where they know an event has occurred, but don't know the quantum, or likelihood of liability.

An insurer will lump all these unknown/uncertain claims together under the heading of IBNR, normally referred to as Incurred But Not Reserved (not reserved as individual cases).

So, projected final claims =
Claims Paid +
Claims outstanding & reserved +
IBNR

For a mature year, most claims will be paid or reserved & IBNR will be small

For an immature year, few if any claims will be paid, some outstanding, but the bulk will sit in IBNR

For a fast growing company, the immature years will be larger than the mature years, so getting a reasonable figure for IBNR is CRUCIAL. And, if the company is basing its pricing on its past "results", getting IBNR roughly right becomes CRITICAL.

Note that I use words like "reasonable" and "roughly" - it's not an exact science, despite what an actuary may tell you. In my experience, actuaries calculate things very precisely, but are frequently miles out - especially with fragmented, non-homogeneous accounts.

And, for me, my assessment would be that GAH don't seem to have much of a clue. So I'll not be buying. And, just for the record, I'm not short either and never have been.

Garbetklb

[treeshake] 18/8/2015 20:19

This popped up on my monitor today and have to say guys very balanced and refreshing BB to read Not invested yet but looking

[hydrus] 18/8/2015 17:58

The motive of longs and shorts is exactly the same, to make money. I'm afraid you are kidding yourself if you think there is somehow more nobility in being long. Short attacks occur to companies that typically have shortcomings in governance and/or accounting. I welcome them as they help crystallise and clarify my thinking. Of course if you are 100% confident about a company then a short attack offers you a superb opportunity to buy cheap. In any case there doesn't appear to be a short attack here, just holders selling with concerns about management.

[valhamos] 18/8/2015 16:30

Hydrus

I have over the years invested in companies that have at some stage been subjected to a short attack. I am not saying that has happened here but as time has gone on I have become wary of repeated bearish posts from the same poster. I need to understand the motive. So rather than being 'hypocritical' it is a case that I can understand the motive of a bullish and evaluate the content accordingly, whereas the motive of a bearish post is often less than clear. Also these short attacks have often questioned the integrity of the company's management which has also been a feature here from a number of posters. So there often isn't an equivalence between bullish and bearish posts in terms of analysis of a company's performance/fundamentals.

[battlebus2] 18/8/2015 16:05

Long and short of all this is we are on a more sound footing than we were, like every stock there is risk so make your own choices. Nothing wrong with hearing opposing views given the past history here , for me 40p seems a reasonable target.

[hydrus] 18/8/2015 15:32

'The problem comes I think when these same traders are out and bearish in such a way as to influence others, especially when these bearish comments are made repeatedly.'Valhamos, presumably we will see you posting similar comments when you see someone holding shares here being bullish about the company?Also I expect you won't be posting positive comments on the company, otherwise that might be hypocritical?

[saucepan] 18/8/2015 15:28

Thanks, the Shuffleman. I will step aside from the discussion now for those reasons. Your points acknowledged (post 2957) Valhamos. All I would add, is that I started off my input today by stating that I was (genuinely) very tempted to press the buy button yesterday (and this would have been a technical trade). My intention was simply to explain why I did not quite manage it myself. I reiterate that I hope the trade works for my friends.

[valhamos] 18/8/2015 15:16

Saucepan

You are obviously in and out of stocks on a short term basis, which is fine if that's your style; I tend to be much more long term, usually several years.

It is also clear that charts and support levels form an important part in your investing. It doesn't for me.

There is absolutely no problem with that; we each have our own investment styles. And it is also natural for those with short term trading styles to be bullish when they are in and bearish when they are out. The problem comes I think when these same traders are out and bearish in such a way as to influence others, especially when these bearish comments are made repeatedly.

Hence my comment from last September that you helpfully quoted in your post.

I believe you have already stated some time ago that your decision last September was proved correct, so why the need to continually "evaluate whether past trading decisions were the correct ones."?

Lucky Mouse thinks the directors are liars. And if you can't see yourself ever trusting the company again surely it is irrational to even contemplate that there might be "a time when I have more confidence to invest in GAH again."?

[the shuffle man] 18/8/2015 15:10

Saucepan

Your views are always welcome.

This thread has always been well balanced with decent discussion on both the bullish and bearish views.

Lets all keep it that way and not let it deteriorate like some other ones.

[saucepan] 18/8/2015 14:44

Valhamos: just to remind you of this September 2014 post:

Some, despite being very positive in the lead up to the results, bailed out without being very specific as to what in the results disappointed them. Also even more intriguing were a couple of posters who initially concluded the results were very positive then quickly changed their minds and sold.

Perhaps people don't do analysis anymore, just trade?

If my memory serves me correctly, that post was levelled at cfro and myself when we exited on the failure of 80p support and in order to protect very good gains.

That proves to have been a prudent decision.

I stated why I remain here: I continue to follow stocks I have previously been invested in, in order to learn and evaluate whether past trading decisions were the correct ones. The story also has an intrinsic fascination.

I reserve the right to change my views, and perhaps there will come a time when I have more confidence to invest in GAH again.

[the shuffle man] 18/8/2015 14:37

Re Claims reserves - they have had to put extra aside which will finish this year and then when back to normal provisioning, will hopefully show a good profit.

[valhamos] 18/8/2015 14:34

cfro

"The main problem seems to be little or complete lack-of reserves. It would only take one bad run of luck or a major event to put the company under some serious strain."

Well GAH does have reinsurance in place to mitigate some of the risks, but that is the nature of a relatively new insurance company still establishing a history of claims provisioning. So probably not for you and I guess not everyone's cup of tea.

[sailing john] 18/8/2015 14:32

Valhamos - it is good to have some caution. The fact is that you are unlikely to get it from current shareholders so it is likely that those who previously held and have knowledge of the company are the only ones who will raise concerns. I know for a fact that both Saucepan and cfro only have our interests at heart and they may or may not be right. I welcome their input.

All will be clearer on the 10th September

GL - SJ

[valhamos] 18/8/2015 14:25

Saucepan

"I cannot see myself ever really trusting what the Company says again"

Thanks for your views, I don't happen to share them, but it's a free country...

But what I don't get is why having sold a while back you feel the need to keep posting here with a negative stance.

It's obvious from what you say you are never going to invest in GAH ever again, so wouldn't you want to get closure and move on?

[simonparker5] 18/8/2015 14:15

Saucepan, yes, point accepted. Lets hope we have a new era of openness.

[battlebus2] 18/8/2015 13:58

Well they have said claims are at a normal level now.....

[saucepan] 18/8/2015 13:55

simonparker5 - the following is partly tongue in cheek, so please forgive me:

the market is assuming those events have already happened! Which clearly they have not.

I am not sure it can ever be "clearly": GAH was a long time admitting, once before, that it had suffered a devastating fire. Private investors were the last to know about it, while "insiders" clearly did.

[simonparker5] 18/8/2015 13:38

cfro you may be right but I think at current levels the market is assuming those events have already happened! Which clearly they have not.

[cfro] 18/8/2015 13:35

Having researched this company thoroughly in the past and knowing what i now know, i too could not trust this company and wouldn't touch it with a very long bargepole..

The main problem seems to be little or complete lack-of reserves. It would only take one bad run of luck or a major event to put the company under some serious strain.