The reinsurance markets remain quite challenging today, as companies like Everest Re (NYSE:RE)
find themselves sandwiched between double-digit price declines in many
reinsurance lines and low rates of return on their investment portfolio.
Everest Re has been doing a good job of managing through this tough
period, using new products and revised strategies to grow despite the
pricing pressures and maintaining a solid balance sheet.
I liked Everest Re six months ago as something of a relative value play in the sector
and the shares have done alright since then. I do still think that
there are opportunities for Everest Re to turn the changes in the
industry to its favor (including managing/advising third-party capital),
but rate pressure is going to take a toll on returns and the shares
aren't quite as interesting to me now. I still like Everest Re as a
company, but I just happen to think that there are more interesting
risk-reward opportunities in areas like life and P&C insurance.
Read more here:
Everest Re Managing Through A Tough Environment
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