Posts Tagged ‘Markel’

Markel reports good FY 2020 results!

February 6th, 2021 Comments off

Markel released FY 2020 results!

At speciality insurer Markel Corp. (NYSE:MKL) earned premiums rose 11% from $ 5’049’793 in FY 2019 to 5’612’205 $ at the end of FY 2020

Book value per common share outstanding rose 10% from $ 802,59 to $ 885,13 at the end of FY 2020.

The combined ratio in FY 2020 was 98% after 94% in 2019 but in the fourth quarter 2020 Markel reported an improved combined ratio of only 89%, which even included four points of pandemic and catastrophe-related losses.

Markel’s insurance operations improved in a significant way:

“Our insurance operations delivered an underwriting profit for 2020 in the face of significant losses attributable to the global pandemic and the unusually high number of natural catastrophes as we benefited from capturing meaningful rate increases and new business in targeted growth areas globally, while exercising strong expense discipline,” commented Thomas S. Gayner and Richard R. Whitt, Co-Chief Executive Officers.

The investment return of Markel decreased 18% primarily driven by the impact of lower short-term interest rates on short-term investment income.

Net investment gains of $ 617,979 in 2020 were primarily attributable to an increase in the fair value of equity securities.

Looking at the private equity segment “Markel Ventures” operating revenue rose 36% to $ 2,794,959 thanks to 2 acquisitions in 2020 and operating income rose 51% to $ 254,078

Investors were pleased with these results. Markel’s share price rose 11% since the 2nd of February when results were released.

The all important book value / share price ratio stands at 1.2 ,rather cheap for Markel which is normally valued at 1.5!

This low ratio reflects 2 problems Markel has in the current environment:

1. Today to find great businesses as acquisiton targets at acceptable prices for Markel Ventures is very hard!

2. Regulatory control of the way Markel holds and invests capital!

Therefore investors should not expect market beating results in the near future but over a time horizon of 5 to 10 years the picture could change materially.

Markel today is a „Hold“!

Markel Corp. increases book value to an all time high in FY 2009!

February 15th, 2010 Comments off

Last week Markel Corporation (NYSE: MKL), one of the two companies this blog follows intensely, reported its earnings of FY and Q4 2009.

As we all know, 2009 was a challenging year:

With the American economy still in recession mode, the insurance market was crowded and very price competitive.

But Markel is a very disciplined insurance company: they try to serve well their clients but their primary goal always remains profitability!

In this challenging environment Markel was able to increase book value / share to an astonishing all time high of $282.55 !

The combined ratio fell from 99% in FY 2008 to 95%, another sign of strength of this well managed company.

The compounded average growth rate of their equity investment return of the last five years was 11%!

Not bad in these difficult times, isn’t it?

Last Friday the stock traded at $ 342.95 . This translates into a price/book ratio of 1.2

Seems rather cheap historically: in the past Markel normally traded at a price/book ratio of 2.

Do your own due diligence but perhaps it’s a good idea to snap up some shares: Markel is widely seen as the “next Berkshire Hathaway”!