Securing the Gain
Amtrust Financial Services, Inc. (AFSI) is a holding company. The Company is a multinational specialty property and casualty insurer that operates in four business segments: small commercial business, specialty program and personal lines reinsurance. The Company transacts business through 11 subsidiaries: Technology insurance Company, Inc. Rochdale Insurance Company, Wesco Insurance Company, Associated Industries, Insurance Company Inc., Milwaukee Casualty Insurance Company, Security National Insurance Company, AmTrust Insurance Company of Kansas and AmTrust Lloyd’s Insurance Company of Texas.
[PostStockWidget stock_valuation="" pricetype="live" manual_date="Dec. 21, 2012, 2:04pm GMT" symbolcodes="'AFSI'" symbolprices="52" div_align="right"]
In just 6 weeks, AFSI has become a star in our portfolio. We identified a low valuation at $40.59 in mid-September and the shares have now appreciated by almost 30%.
The Purple Chips model is good at identifying top quality companies and identifying low risk entry points. Our objective is not to seize every possible dime of profit but rather to capture the low risk entry points, seize the profit and then deploy our newly free capital on the next low risk opportunity.
The Purple Chips valuation range is: LOW $43, HIGH $52
HIGH VALUATION IN AMTRUST FINANCIAL AT $52.00 (AFSI-US, $52.00) FULL POSITION
TOTAL RETURN (including dividends) +28.6%
PURPLE CHIPS TARGET: $52.00 POSITION SIZE: FULL (5.0) P/E: 11.7X DIV: $0.80 (1.5%) MKT CAP: $3.9B Cash: N/A RETURN ON CAPITAL: N/A EARNINGS YIELD: 10.9% 5 YR EPS Growth rate*:17.9% P/E/G Ratio: 0.65 EPS: $4.44 2015 EST.: $5.32 2016 EST.: $5.71
*Blended growth rate= 2/3 historical (5yrs), 1/3 forward.
