Forum Archive Index - January 2001

["G Stolwyk" <stolwyk@wave.co.nz>]

 

 

Peter,

 

You do work early!!

 

Your careful summing up confirms my opinion of QBE; see my post of Jan 5: " WORKING.....Inv....results (1): Discussion."

 

QBE, < www.qbe.com.au > after recent takeovers, is now one of the leading underwriters at Lloyd's in London.

About 70 % of their revenue comes from overseas, hence the stock can be classed as 'international'.

 

This implies that Australians will have some 30% of their dividends imputed; however, one invests mainly for growth!

 

The latest takeovers are being bedded down and analysts agree that the US and/or a larger stake in Asia could be the next moves.

 

Re takeovers, they adhere to a risk/reward ratio being in their favour and expect a positive return after a very short time.

They typically take over companies with poor management and act quickly to rectify the situation! 

 

Its large European investments have forced the company to adopt Dec 31 as the balance date.

Hence the next announcement- Feb.27?- will be a final result to cover 6 months only.

 

The current share price is somewhat static, possibly due to the market wanting to know the effect of the many catastrophes on QBE. They made extensive use of reinsurance with 'A1' companies before and did very well!

 

Many insurance companies had a tough time and there has been a heavy shakeout at a very low point in the cycle.

It is obvious that insurance fees will rise!

 

But how did the London operations perform considering the heavy storms and floods? 

If the to be announced results are exellent, then a rise in the share price is possible and your chart is very helpful in this context!

 

Thanks Peter!

 

Gerry