Buy W.R. Berkley (WRB)
I’m buying these common shares of insurer W.R. Berkley (WRB) as a replacement for the preferred shares that I sold out of Jubak’s Picks on October 6. I think they offer almost twice the upside with just slightly more risk.
I’m a big fan of the very conservative ship run by CEO William Berkley. No financial company has escaped all damage from the recent (and in my mind on-going) financial crisis, but W.R. Berkley has dodged most of the big bullets. The $108 million write-down that WR Berkley took in the fourth quarter, for example, was on invested assets of $12.5 billion.
The upside here is that, as the company told Wall Street in April, it looks like prices in its property and casualty insurance lines are starting to turn. In April the company said it expected prices to improve as weaker insurers abandoned business by the end of 2009. As of October 7, I’m adding this stock to Jubak’s Picks with a target price of $33 a share by September 2010.
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I assume the target price is for September 2010.
sweet, im in on this one
jim, your track record speaks for itself, but i have a hard time pulling the trigger on most of your buys. most of your buys seem to be at or near 6 month to 1 year highs….wrb is already 37% off it’s $18.86 low and at an 8 month high. i know your not supposed to “catch a falling knife” and chase stocks down, but i have trouble with buying stocks at the top in a momentum investing style.
that said, i love your posts and follow you daily.
They disclose than 3Q earnings on oct 26th, do you think they will exceed wallstreet expectations?
Jim,
In your previous post you said that you will sell the preferred shares out of your personal portfolio 3 days after the post. Will you be adding these commons shares to your personal portfolio?
I’m guessing you mean Sept 2010…not 2009
Jim,
I agree with your insurance thesis, but I personally own NATL, ACGL and RNR. I looked at WRB, and I agree that it is cheap, but I think that those three have better risk-reward ratios. Have you looked at these three names?
Mike
Jim,
Just a question but do you see the value of going to the risk reward from the MLP’s to some of the oil/commodity stocks? I personally have been selling some of them to get more percentage in RIG and SLB
I would love it if you could hyperlink company names back to their stock summaries on Yahoo or Microsoft finance. I think it would help your readers crunch the numbers a bit better and you might be able to generate some additional revenue from your blog.
Yep, I meant 2010 instead of September 2009. (Of course, ifr we get to September 2010 and are still way short of my target, I’ll tell you I really meant 2011.)