Lancashire Share Discussion Threads

[csalvage] 03/11/2022 13:11

Nice trading update, hope the share price kicks on from here.

[feddie] 14/9/2022 08:30

Perhaps someone finally noticed that a 78% combined ratio is quite outstanding and the certainty that the war net loss is US$22m and no more is quite appeasing. None of this is fresh news.

[betman] 13/9/2022 15:32

sharp rise from July 400p to 550p. Is this recovering from oversold or is there something going on, on the corporate front ? No real pick up on volume other than beginning Sept

[ppreston1] 24/8/2022 09:30

Credit Suisse raises Lancashire price target to 725 (675) pence - 'outperform'

[feddie] 27/7/2022 08:52

Good numbers posted today. Time for a special dividend.

[gco1133a] 22/7/2022 10:59

Good BEZ numbers I imagine

[csalvage] 22/7/2022 10:29

Why the rise today.

[km18] 15/7/2022 13:42

...from a few months ago...

Lancashire is specialised in the provision of reinsurance products and global speciality insurance.  intermediaries. The Company operates through five segments: Property, Energy, Marine, Aviation and Lloyd's. It underwrites worldwide, insurance and reinsurance contracts that transfer insurance risk, including risks exposed to both natural and man-made catastrophes. The resilient diversified funding structure effectively forced up net revenue from £551.5m to £747.2m. As a result, Lancashire Holdings derived an attractive P/FCF ratio of 7.5, higher than the financial services P/FCF ratio of 5.3, which in turn signifies that Lancashire Holdings allocated its funds more efficiently to finance its operating and investing activities. Subsequently, the firm’s PE ratio stood at 9.3, lower than the financial sector P/E ratio of 15.33, suggesting that Lancashire Holdings is undervalued with respect to the financial sector and thereby the security is expected to surge in value. Consequently, it implies that investors are able to purchase the stock at a discount while still deriving precedented and attractive dividend yield of 6.05%, resulting in ample investment opportunities.

Brief Analysis:

P/FCF = 7.5, above financial services sector benchmark
P/E = 9.3, below the financial services sector threshold.
Dividend yield 6.05%.
Revenue = £747.2m, higher than prior year...

...from WealthOracleAM

https://wealthoracle.co.uk/detailed-result-full/LRE/350

[ghhghh] 04/7/2022 06:37

Lancashire cheap but lowly rated because they need to diversify to spread risk away from natural disasters. This means they are an attractive bolt on acquisition for a larger player. IMO will be taken out by year end.

Last year's disasters have allowed Lancashire to price much higher this year. IF no major disasters they will be highly profitable.

And at least less exposed to general market downturns

[harleymaxwell] 30/6/2022 17:58

Decent rise with volume . The reinsurance market is hardening massively wonder if this could get taken out by another company that wants diversification or quick gr0wth...

[my retirement fund] 28/4/2022 10:28

Agree, wouldn't touch this with a barge pole on that basis alone.

[medieval blacksmith] 28/4/2022 10:24

If the figures presented to me on Sharescope are correct this company has made post-tax profits in the last five years of (£70.6m), £37.6m, £118.2m, £4.5m and (£61.6m).

A five year cumulative profit of £28.1m.

And again we have:

"Intention to purchase own shares

Pursuant to and in accordance with the general authority granted by
shareholders at Lancashire's Annual General Meeting held on 27 April 2022,
Lancashire intends to purchase up to 3,000,000 of its common shares of $0.50
each in order to satisfy a number of future exercises of awards under its
Restricted Share Scheme. A further announcement in accordance with Listing Rule
12.4 will be made in due course."

Well, if they max out on purchase at current price that is £13.5M approx.

So they are spending almost half the last 5 years' cumulative profits to buy shares for the executives and such.

This comes off the back of another share repurchase scheme reminded to us in November 21:

"Pursuant to and in accordance with the general authority granted by
shareholders at Lancashire's Annual General Meeting held on 28 April 2021,
Lancashire intends to purchase up to 1,000,000 of its common shares of $0.50
each in order to satisfy a number of future exercises of awards under its
Restricted Share Scheme. A further announcement in accordance with Listing Rule
12.4 will be made in due course."

What have they done to deserve these bonuses? If they take fat remuneration during good years they should be receiving none in lean years! Oh well, they would say, we are just buying them now to hold them in treasury for donkeys' years whilst they are cheap. Yeah right!

Maloney has already cashed in £1M in options in the last 12 months! Does he remember he came crawling to shareholders for money in 2020 which diluted and didn't deliver. Bad luck is it or is it a slackening of underwriting criteria to get earnings up?

This is becoming too much 'snouts in the trough' for my liking.

Deliver the goods to shareholders and then, AND ONLY THEN, you should start thinking about your gluttonous share options and share repurchases - not the other way around.

Maloney has been a good CEO for sure, but that doesn't give him the mandate to do this IMO. This is one of the worst companies for self-entitlement that I have seen of late. Conduit executives, for example, seem to be buying the shares - and very large tranches - with their own cash. They are more in-tune with ordinary shareholders IMO and that is why I am currently a Conduit shareholder and not one in Lancashire.

Someone tell me I'm wrong.

IMO & DYOR.

[1knocker] 28/4/2022 09:14

Nice bounce today

[hopan] 05/3/2022 08:16

The insurance implications from the Russian invasion of Ukraine
hxxps://www.propertycasualty360.com/2022/03/04/russian-attack-what-are-the-insurance-implications-414-218617/

[hopan] 04/3/2022 22:15

Big bonus pool might be the reason for boarding unnecessary risk for earning premium. Underwriter earn his bonus regardless, and shareholder feels the pain. Such a wrong incentive. Unbelievable. You don't distribute bonus if you make a loss. It is that simple.

[hopan] 04/3/2022 22:09

Anything bad happens in the world, this stock has a hit! What a horrible risk management! I hope they have not provided war/political risk insurance to that region specifically due to potential risks.

[1knocker] 04/3/2022 14:39

You are a Job's comforter, Freddie!!

[feddie] 04/3/2022 12:51

I wonder what is the exposure to the aircraft lessors that are now strugling to reposess the aircraft leased to Russian airlines. If irrecoverable, the policies cover war.

[1knocker] 04/3/2022 12:25

I topped up not many months ago at 450, and thought that cheap. I am not looking so clever now. It is very tempting to buy a few more, but think I will wait for evidence that the bottom is in and the tide has turned.

[medieval blacksmith] 02/3/2022 13:12

I've just bought a tranche.

Maloney is no fool and a very competent CEO IMO. He'll make the adjustments necessary going forward. Still not happy with the continuing share awards though. That should stop.

[salpara111] 02/3/2022 10:20

Breathing a huge sigh of relief that I exited with a large loss at 520 last year rather than waiting for an even larger loss now.
Can they actually price appropriately for risk?
I wonder if anyone would actually be interested in buying them. I would imagine that most shareholders would be happy to get 550p right now.

[essentialinvestor] 14/2/2022 14:22

Exceptional weather events appears to be becoming less exceptional!,

too many excuses here of late.

[km18] 14/2/2022 11:06

Lancashire is specialised in the provision of reinsurance products and global speciality insurance. intermediaries. The Company operates through five segments: Property, Energy, Marine, Aviation and Lloyd's. It underwrites worldwide, insurance and reinsurance contracts that transfer insurance risk, including risks exposed to both natural and man-made catastrophes. The resilient diversified funding structure effectively forced up net revenue from £551.5m to £747.2m. As a result, Lancashire Holdings derived an attractive P/FCF ratio of 7.5, higher than the financial services P/FCF ratio of 5.3, which in turn signifies that Lancashire Holdings allocated its funds more efficiently to finance its operating and investing activities. Subsequently, the firm’s PE ratio stood at 9.3, lower than the financial sector P/E ratio of 15.33, suggesting that Lancashire Holdings is undervalued with respect to the financial sector and thereby the security is expected to surge in value. Consequently, it implies that investors are able to purchase the stock at a discount while still deriving precedented and attractive dividend yield of 6.05%, resulting in ample investment opportunities.

https://wealthoracle.co.uk/detailed-result

Keep up to date with WealthOracle AM

[topvest] 13/2/2022 20:50

At least both companies have a history of reserve releases, which means a cautious provisioning approach being taken on insurance liabilities. I guess the poor investment return is due to the bond yield moving up with the prospect of sharply higher interest rates. Unfortunately, non-life insurance hasn't been a profitable area over the last few years. Hopefully, 2022 should be much better as the cycle has definitely turned.

[hopan] 11/2/2022 18:22

I am not sure BEZ results are any better if you look at the details. $200mio from reserve release and $100mio from investments... I was expecting better performance from BEZ to be honest. I am surprised with the poor return of investments 0.1% at LRE. Any expert view on their performance for us??