Financials
Andrew Hollingworth previously thought WRB was an interesting business, now he thinks it could be a compelling long-term investment - its valuation has come down from over 3x book value to c.2.1x. Were it to start making ROE’s of 20% again this valuation equates to a look through PE of 10.7x. Andrew notes that the last time the insurance industry had a hard pricing market (2001-07) and interest rates were this level, WRB made some very impressive y/y returns. During that period, its book value per share rose from a rebased $1 level in 2001, to $3.85 by 2007 (+285% in 6 years, an IRR of 25% per annum).
Edition: 163
- 23 June, 2023