Hiscox Share Discussion Threads

[spooky] 11/6/2021 10:33

Cyber activity should be regarded as a market opportunity rather than a problem. Their whole business involves the assessment of risk and pricing it correctly when they decide to accept it. Yes by all means they can temporarily get something wrong but that is the business they are in.

[hopan] 10/6/2021 21:53

It look like Barclay's analyst explained some of the reasons. He is blaming the reflation trade for the underperformance.

[hopan] 28/5/2021 18:18

As long as they pay dividends, I don't mind this stock or BEZ is undervalued or stay at the same level for years. This is in my SIPP and can stay there for a long time. It is only annoying to see the MarktoMarket of this holding, other than that, as long as they start paying dividends, all is fine for me.

BEZ paid 12.3p as a dividend in 2019 for 35p EPS. If they can repeat the same performance again, that is 4.1% dividend yield for me (on 300p share price)... there is also capital upside option I have...

[essentialinvestor] 28/5/2021 18:05

Hopan, interesting points and TBH I personally can't answer that.


Sometimes shares and sectors trade below value. I hold Senior which was bid for today
and happened to highlight it as a 2-3 year play on the SHA board yesterday.

In terms of cyber/ransomware then yes it's reasonable to ask are premiums reflecting the arguably increasing risk. I suppose you only really know that after the event
and unless you work in the sector or have close contacts, it's difficult to make an assessment.

Not much BOD buying in the sector atm, not always a salient factor to be fair.

[hopan] 28/5/2021 17:49

Recent broker target share price reductions can have some effect on sentiment as well.

[hopan] 28/5/2021 17:43

I doubt that algos created this much of rerating, it looks more like a large institution or fund is reducing exposure to this sub-sector. LRE, HSX, and BEZ all move in synchronise wave.

I try to understand their rationale for reducing exposure. Do they expect defaults in the sector? Do they expect big ticket claims from Cyber/ransomware? Do they expect a damaging hurricane season? Maybe combination...

Or they may be thinking their fixed income portfolio will go down in value due to rising rates? or they think we are at the top of the insurance cycle.

or is it just a bad timing for them?

[essentialinvestor] 28/5/2021 15:51

In/out on LRE.

[spooky] 28/5/2021 15:48

Haven't you been long LRE for a while? Or just hopping in and out until they turn?

[essentialinvestor] 28/5/2021 14:39

Bought a very small amount of Lancashire yesterday, just 1,000 shares.
Tried to start some discussion on the LRE board a number of times but no takers.


Gut call is HSX appears cheap and what we are seeing is algo dominated movements or
perhaps a large institutional holder/s reducing exposure to this sector.

On fundamentals, is cyber ransomware risk being adequately priced..

[spooky] 27/5/2021 15:46

I get it. Either HSX, LRE, BEZ, find a bottom soon, at or above post covid lows, or things will get ugly. I am not expecting that but..........

[essentialinvestor] 26/5/2021 15:33

Bought a very small amount under 7.60, not enough to cause any headache in
the case of something unexpected.

Possibly available under 7.40, but best keeping in mind wider markets are very
strong atm, this price weakness is in stark contrast. If we get some equity
volatility would not want to bet where this could end up.

[spooky] 26/5/2021 15:21

Well there is definitely something strange going on. I'm still waiting for some sort of sign that a bottom is forming.

[hopan] 26/5/2021 15:19

LRE, BEZ and HSX are all down more or less equally. I don't think they all need fresh capital. There must be a big fund reducing exposure to the sector. Hope it is a mistake...

[essentialinvestor] 25/5/2021 13:43

I got half way through the Q&A session but TBH that level of questioning is
above my pay grade on this sector.

All available on their IR site.

[essentialinvestor] 25/5/2021 12:55

spooky, you may well be correct. I watched the conference call and
they appear to stress financial strength.

Perhaps ransomware/cyber attacks could be an area there is some current caution on.

[essentialinvestor] 24/5/2021 15:10

Yes Jack, re BEZ and HSX in particular.

Just speculation on my part and as you say they have given no indication
of this.

[spooky] 24/5/2021 15:09

I would be more than surprised if they felt the need to raise funds now following the 375m they added last year.

[cousin jack] 24/5/2021 15:06

Hi EI. I’d not considered that (I assume you mean in relation to Hiscox rather than non-life insurers generally ?). The last statement seemed comfortable about their ability to satisfy claims and growth, although they could of course see bigger opportunities elsewhere.

[essentialinvestor] 24/5/2021 13:38

Jack, potentially capital raises on the way?.

[cousin jack] 24/5/2021 13:28

Seems to be breaking lower. I see that Beazley has fallen below its 2020 pandemic low so maybe the same about to happen here. I would certainly add at those levels as the outlook now hardly justifies a lower price than the outlook did then. I’ve bought a few Beazley too as the RSI around 30 seems extremely oversold. Just need to be patient now.

[hyden] 13/5/2021 22:33

Well done Cousin Jack. It's back down to my buy price, which I wasn't expecting. I have a longer time horizon and am looking for £14 at least, which I hope to see by year-end barring any major escalation in Israel.

[cousin jack] 13/5/2021 11:56

Back down to the support line. Bought at this level on 5 May for a nice turn on 7th May so back in hoping for a repeat.