I understand that good companies should trade at a premium, but it is getting harder for me to reconcile W.R. Berkley’s (WRB)
valuation with the realities in the insurance market today and the
likely trajectory over the next few years. W.R. Berkley is a very
well-run specialty insurance company, but rate growth is hard to find,
claims severity is worsening in some lines, and reserves are looking a
little thin across the industry.
The insurance
industry is cyclical and the difficult market conditions of today will
eventually improve, but the shares seem to be pricing in high
single-digit long-term earnings growth, and I don’t think that leaves
much upside in the share price.
Follow this link for the full article:
W.R. Berkley Has A Lot To Live Up To
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