Myth465 Posted February 22, 2011 Share Posted February 22, 2011 There are, they are in the prior pages. FFH writes to grow float a break even price and is huge with a $20 billion portfolio. These guys write to make money and stay small to pick the sweet spots. The middle east and New Zealand tragedies should create a few more sweet spots. Link to comment Share on other sites More sharing options...
bargainman Posted February 23, 2011 Share Posted February 23, 2011 Just checking, the Pinks are LCSHF.PK correct? has anyone purchased them on the pinks vs LRE.L? What broker did you use? Also what is the ratio? The pinks are around $8-10/share and the LRE.L is 600? I guess that's 600 pence so 6 pounds which would be about $10? Thanks for any help with the exchanges.... Link to comment Share on other sites More sharing options...
Myth465 Posted February 23, 2011 Share Posted February 23, 2011 I own the pinks and believe they are at a 1 to 1 ratio. I also got the dividend as well. I honestly hope LRE trades down. I think its worth 1.5 - 2.0 book value, but would prefer to buy at book. Link to comment Share on other sites More sharing options...
enoch01 Posted February 23, 2011 Share Posted February 23, 2011 I did own the pinks, but sold recently after receiving the dividend. The company is great, but there's not enough margin of safety for me at 1.3 P/BV. Hopefully hurricane season brings the price down. Link to comment Share on other sites More sharing options...
Myth465 Posted February 23, 2011 Share Posted February 23, 2011 I plan on holding and I want more at 1.1 BV. Very nice to see they bought back no shares at higher BV prices, I plan on buying when they buy. They seem to know what they are doing. I see this as a nice 20%+ return per annum and an awesome return if there is a hard market. My dividend was about 20%. This assumes survival. Its too hard to get into the pinks so I plan on holding unless I get 2x book value. Right now sanity is returning to insurance and the world and risks should be more appropriately priced. We have horrible flooding in Oz, Earthquakes in NZ, and now all sorts of chaos in the middle east. Hopefully we arent on the wrong side of the trade in relation to claims that will likely be filed in the energy space. I view this as a high quality holding and will hold until its significantly overvalued. Link to comment Share on other sites More sharing options...
bablu Posted February 27, 2011 Share Posted February 27, 2011 http://www.lancashiregroup.com/lre_group/investor_relations/results_presentations/reports/2010/201-21-02a/201-21-02a.pdf page 19/24 Just wondering how to reconcile above numbers... For ex: Q4 2010: 21.7-38.8+21.8-12.7+2.2 = 494.2 But the above report shows: 471.6 Any help is appreciated... Link to comment Share on other sites More sharing options...
twacowfca Posted February 28, 2011 Share Posted February 28, 2011 http://www.lancashiregroup.com/lre_group/investor_relations/results_presentations/reports/2010/201-21-02a/201-21-02a.pdf page 19/24 Just wondering how to reconcile above numbers... For ex: Q4 2010: 21.7-38.8+21.8-12.7+2.2 = 494.2 But the above report shows: 471.6 Any help is appreciated... The Calculation is 521.7-38.8-21.8+12.7-2.2 = 471.6 Link to comment Share on other sites More sharing options...
Myth465 Posted February 28, 2011 Share Posted February 28, 2011 http://www.lancashiregroup.com/lre_group/investor_relations/results_presentations/reports/2010/201-21-02a/201-21-02a.pdf page 19/24 Just wondering how to reconcile above numbers... For ex: Q4 2010: 21.7-38.8+21.8-12.7+2.2 = 494.2 But the above report shows: 471.6 Any help is appreciated... Quick question? Why are you auditing the financials. Auditors are paid adequately (though not enough) to do that. Why not let them worry about the ticking and tieing and focus on the analysis? Link to comment Share on other sites More sharing options...
bablu Posted March 1, 2011 Share Posted March 1, 2011 The Calculation is 521.7-38.8-21.8+12.7-2.2 = 471.6 Thanks Twacowfca.. Now it makes sense but the way they presented one had to know the intricacies of reserves to do the math .. Quick question? Why are you auditing the financials. Auditors are paid adequately (though not enough) to do that. Why not let them worry about the ticking and tieing and focus on the analysis? good question.. I don't have time (lazy) to go thru that level of details in the balance sheet.. I was helping my nephew to understand financial statements and suggested to look at this one because it's simple and less cumbersome .. he didn’t understand as well as the undersigned ... Link to comment Share on other sites More sharing options...
Myth465 Posted March 1, 2011 Share Posted March 1, 2011 Thats cute. You are a good uncle, I need to spend sometime with my nephew now that you mention it. Link to comment Share on other sites More sharing options...
Parsad Posted March 2, 2011 Share Posted March 2, 2011 Quick question? Why are you auditing the financials. Auditors are paid adequately (though not enough) to do that. Why not let them worry about the ticking and tieing and focus on the analysis? I've caught alot of stuff over the years that the auditors have missed on various companies. One of the main problems is that you've got CA, CPA students conducting the audit with a senior audit manager monitoring them. Alot of times the senior manager assumes that the consolidation review that the student has done is correct, but unless the manager does the same review, they won't know for sure. The CFO is assuming that the Controller, who does the bulk of the consolidation work and creates the continuity schedules did it correct. The CFO reviews the work and makes valuation adjustments on fair value items and puts together the Notes and MD&A, making sure that the Controller has maintained all internals controls during the accounting and consolidation process. The CA student reviews the work of the Controller and CFO. The senior manager reviews the work of the student and overall financials. Then it goes to Partner Review who is trusting that the senior manager and student did the proper due diligence. That's alot of room for error...thus you get regular restatements by companies. Cheers! Link to comment Share on other sites More sharing options...
Myth465 Posted March 2, 2011 Share Posted March 2, 2011 Parsad sounds like you really know how the auditing process works :D. You are correct, kids out of school are conducting the audits of the worlds biggest companies its quite interesting. Even worse is the firms pretty much let management do what they want as long as they have enough CYA. With that said I am perfectly happy assuming everyone did what they needed to do, and will let the MOS protect me against minor errors, we are all screwed when there are major errors. Link to comment Share on other sites More sharing options...
Parsad Posted March 2, 2011 Share Posted March 2, 2011 Don't get me wrong Myth. For the most part, the accounting system does its job. But there is plenty of room for error and opportunity for unscrupulous people. I rely on those numbers too when looking at companies, but that's where we all have to really dig in and look where we could get screwed, and then create a margin of safety for those possibilities. Cheers! Link to comment Share on other sites More sharing options...
bookie71 Posted March 2, 2011 Share Posted March 2, 2011 Remember that the auditors only test a statistical sample of the data. I know in the past, when we used to do audits (20+years ago), even being overly cautious, we had mistakes slip through. In proofing a statement it is easy to see what you meant to put down as opposed to what you actually put down. Link to comment Share on other sites More sharing options...
biaggio Posted March 2, 2011 Share Posted March 2, 2011 "we are all screwed when there are major errors." Do you think it is possible to uncover these? Or is it a matter of trusting management? Link to comment Share on other sites More sharing options...
Myth465 Posted March 2, 2011 Share Posted March 2, 2011 "we are all screwed when there are major errors." Do you think it is possible to uncover these? Or is it a matter of trusting management? Im an internal auditor and a realest (some would say a cynical bastard). Also when you study gaap / accounting you realize that the numbers are really a thumb in the air guess at whats really going on. Ideally accounting should reflect economic reality, but even some of the gaap rules make this difficult. I think you can catch significant errors in 2 ways. 1 - The Bil Ackman method. Put in the hours, perhaps hundreds or thousands of them. I dont and wont do this. 2 - The Buffett method. Use common sense. Does it look like earnings are being smoothed, are they doing wierd things, making promises they cant keep, reaching for revenue, earnings, yield, something. Watch Management. When they rub you the wrong way sell. With that said, I would say outside of black box businesses (Banking and the like). Accountants, and Auditors are mostly materially right. Link to comment Share on other sites More sharing options...
bookie71 Posted March 2, 2011 Share Posted March 2, 2011 In this year's annual report didn't Buffett say that he and Charley could make the bottom line be anything they wanted. That would make accounting (GAAP) an exact science. ;D ;) Link to comment Share on other sites More sharing options...
Myth465 Posted March 6, 2011 Share Posted March 6, 2011 In this year's annual report didn't Buffett say that he and Charley could make the bottom line be anything they wanted. That would make accounting (GAAP) an exact science. ;D ;) LOL This mirrors my thoughts. Which is a shame because I am an auditor. http://www.gurufocus.com/news.php?id=124931 "Where were the auditors in this crisis? Nobody asks, because nobody cares". It's true, at least to some extent. Accountants have been unbidden and unheard in the public debates about blame and solutions for the market debacle. I think that one of the main reasons public auditors have been marginalized is because they are no longer regarded as independent professionals. Certainly most institutional investors see them as an extension of management, fiercely loyal to their employers, the boards of directors. That may be unfair but it's certainly the perception, reinforced by the fact that many major corporations are becoming closely related to their auditing firms. It's now almost standard practice for a company's CFO and most of its internal audit staff to have graduated from the firm now passing judgment on their work. In many cases the auditors also provide the company with consulting services. Link to comment Share on other sites More sharing options...
ericd1 Posted March 6, 2011 Share Posted March 6, 2011 Years ago I worked in accounting at a major US corp with multiple divisions. Inventory was always a big undertaking in our division and trying to count raw materials, wip and even finished goods wasn't exactly a science. In many cases it was a swag. I would laugh when I opened the annual report and it stated p/l to the penny! The takeaway from my experience was that any one accounting period could be suspect. However, over multiple time periods the trends are important and there should be a reasonable explanation for any specific period variances. Link to comment Share on other sites More sharing options...
Guest Bronco Posted March 6, 2011 Share Posted March 6, 2011 Couldn't they manage earnings just by selling investments? I agree accounting is art and science. In general, I think most companies produce decent results. You just need to do the homework. As we learned, mark to market may be misleading. I still think the accounting rules didnt help the crisis (an extra layer of panic causing events) Link to comment Share on other sites More sharing options...
bargainman Posted March 6, 2011 Share Posted March 6, 2011 In this year's annual report didn't Buffett say that he and Charley could make the bottom line be anything they wanted. That would make accounting (GAAP) an exact science. ;D ;) LOL This mirrors my thoughts. Which is a shame because I am an auditor. http://www.gurufocus.com/news.php?id=124931 "Where were the auditors in this crisis? Nobody asks, because nobody cares". It's true, at least to some extent. Accountants have been unbidden and unheard in the public debates about blame and solutions for the market debacle. I think that one of the main reasons public auditors have been marginalized is because they are no longer regarded as independent professionals. I don't know.. people were up in arms when they heard that FASB 157(?) caused all the banks to have to mark things to market killing their capital ratios if I remember correctly... Link to comment Share on other sites More sharing options...
bookie71 Posted March 7, 2011 Share Posted March 7, 2011 I got my CPA in 1965 and at the time it was unethical to give a cost figure for an audit as you had to be able to extend your audit procedures if something unexpected turned up that needed to be examined further. Over the years that chganged to where firms would almost do an audit just to get the consulting work. Our firm quit doing audits about 20 years ago as there was no way to compete with the big guys when they would do an audit for less than the cost of labor. It has been very heart breaking for me to see the profession going from one of the most respected to what it is starting to be. Link to comment Share on other sites More sharing options...
twacowfca Posted March 7, 2011 Share Posted March 7, 2011 Couldn't they manage earnings just by selling investments? I agree accounting is art and science. In general, I think most companies produce decent results. You just need to do the homework. As we learned, mark to market may be misleading. I still think the accounting rules didnt help the crisis (an extra layer of panic causing events) I agree. I think that WEB meant that they could manage earnings simply by taking capital gains whenever needed. Link to comment Share on other sites More sharing options...
sdev Posted March 15, 2011 Share Posted March 15, 2011 Annual Report released today with updated estimates in the back. http://www.lancashiregroup.com/lre_group/investor_relations/results_presentations/reports/2010/2011-03-15/2011-03-15.pdf Link to comment Share on other sites More sharing options...
Myth465 Posted March 15, 2011 Share Posted March 15, 2011 Thanks. Whats great is they also have an investors day tomorrow. I am sure this will be on everyones mind. They will likely have to make a comment. Link to comment Share on other sites More sharing options...
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