Some days ago Colfax Corp. (NYSE: CFX) hosted their annual analyst meeting on which management provided a detailed analysis and discussion about every section of the company.
Have a look at the transcript which you can find on “Seeking Alpha”!
Shares of Markel Corp. (NYSE: MKL) now reaching $500 gained 20.6% year to date.
This more than doubles the 9.3% the S&P 500 gained so far this year!
As the market seems to appreciate financial stocks once again this high quality company surges all the long with much riskier stocks of the financial sector.
Markel Corporation (NYSE: MKL) reported its Q3 2012 results.
Net income per share came in at $5.32 slightly lower than the $5.48 a year ago.
The combined ratio was 101% due to the loss development on their asbestos and environmental reserves. One additional point is due to an accounting standard change.
The important insurance metric book value/share was $395.48, up 12% from $352.10 at December 31, 2011.
A transcript of their conference call you’ll find on Seeking Alpha.
So what happened at Markel lastly?
Operating revenue rose 13% to $2.2 bil in the first 9 months. The increase was due to an 8% increase in revenue from their insurance operations and an astonishing 51% increase in revenue from their non-insurance operations under the name of Markel Ventures.
If you already didn’t know it, the importance and earnings power of Markel Ventures is rising rapidly!
But there are other good news:
Markel Ventures continued on its acquisition path and it seems that the market finally realizes the value creation which happens here: the share price yesterday rose above $500, a share price not seen for about 5 years!
This translates into a price/book value of 1.3, not too expensive for this great insurance company.
As their former secret weapon “Markel Ventures” slowly becomes a much more known weapon and the market reacts accordingly – are you prepared?
Colfax (NYSE: CFX) released its Q3 2012 results last week. It missed on revenues but beat EPS expectations.
Even if this is a minor detail for real long term investors it shows the difficult economic environment Colfax operates in.
In a quarter to quarter comparison margins shrank significantly:
Gross margin came down to 30.2% from 35.6%
Operating margin went from 5.4% to 3.2% and net margin was 1% on a GAAP basis.
But don’t forget: Those numbers were realized on a much bigger revenue basis after the Charter International acquisition!
So the important question here is: Did they continue to integrate and restructure the acquired businesses according to their plan?
Management gave a few indications on their conference call (the transcript you can find here on Seeking Alpha)
Related to ESAB CEO Steven Simms pointed out that „despite the lower-than-expected sales, adjusted operating margins improved by 70 basis points during the third quarter in comparison to the second. Despite the softness in top line sales, this margin rate was higher than expected as costs were tightly controlled and price increases largely held.”
And further on „…the ESAB cost and restructuring program remains on track, and we are — we continue to be confident with our plan to deliver margins in the low teens within 3 years of acquisition.”
Management adjusted their guidance for FY 2012 slightly:
Revenue is expected to be $ 3.9 – 3.95 bil and EPS should come in between $ 1.29 – 1.33
This values Colfax share at a p/e 2012 of 26 (… it’s only 2 months left!) and 2013 of about 16.
Interestingly the price/sales ratio 2012 is only 0.8 and even lower for 2013 which could mean that a successfull and profitable integration of the acquired businesses is not yet factored into the share price.
For investors who are convinced that management is capable to further execute the „Colfax Business System” the share remains a Buy!
Colfax Corporation (NYSE: CFX), one of the companies this blog follows on a regular basis released its Q3 2012 Earnings !
Have a look!
Markel Corp. (NYSE: MKL) continues to acquire smaller but certainly very profitable speciality insurers:
http://phx.corporate-ir.net/phoenix.zhtml?c=104364&p=irol-newsArticle&ID=1746468&highlight=
Have a look!
Markel will release its Q3 2012 numbers the 8th of November, so stay tuned!
Markel Corporation (NYSE: MKL) released its Q2 2012 earnings and the most important news is certainly the improved combined ratio:
It’s down to a remarkable 87% instead of 103% in the same period last year!
Ok, this year’s quarter was „disaster-free” but nevertheless it seems that the US insurance market is improving.
60% of Markel’s stockholder’s equity is now invested in stocks. So Markel would profit directly from the next stock market upturn.
For more details and all the numbers have a look at the earnings call transcript at Seeking Alpha.
Book value/share, the most important metric to value an insurance company, improved also 7.9 % from $ 352.10 to $ 379.88 this year.
So Markel’s stock sells for 1.1 book value at yesterday’s price of $ 432.25.
Rather cheap isn’t it? A “buy rating” seems more than justified!
Markel Corp. (NYSE:MKL) one of the 2 companies this blog follows on a regular basis released its Q2 2012 earnings.
Have a look at a nice report!
Colfax Corp (NYSE: CFX) published its Q2 2012 Earnings at the end of July.
The Earnings Call Transcript you can find here on Seeking Alpha.
Colfax in 2012 is very difficult to compare with last year but one thing is certain:
the Colfax Business System („CBS”) is at work restructuring and integrating rapidly the acquired ESAB and Howden businesses.
As Steve Simms, President and CEO explained, ESAB profitibility was modestly ahead of internal expectations driven by aggressive SG&A restructuring, global sourcing, plant consolidations and improved pricing.
A „CBS” culture will be established and for example by year end they will implement a streamline global functional organizational structure, eliminate five high cost manufacturing locations and rationalize corporate overhead as well as overall SG&A
As Management points out – regarding Colfax Corp. as a whole – organic growth of 10% suggest the businesses are performing well in their respective end markets. Furthermore, with over 60% of revenues now in high growth regions and strong positions in attractive end markets such as power, energy and mining, they remain optimistic about the prospects for long-term growth.
… already at year end Colfax Corp should be worth a lot more than today … what about picking up some shares?
Colfax Corp. (NYSE: CFX), one of the 2 companies this blog follows on a regular basis today released its Q2 2012 results!
We will discuss them later!