Q: P&C insurance sector has shown signs of weakness, over past several weeks, perhaps due to higher catastrophic losses and pressure on auto premiums. Intact Financial stock has also not been immune and has seen its stock decline over 10% from its recent high of $317. Latest earnings release disclosed weakness in commercial lines, in addition to premiums rates in US.
IFC has been a long time favorite of 5i and stock has performed well, barring the recent softness.
Question is that after 2-3 years of strong performance by P&C sector, do you believe the present weakness to be simply transitionary or it is indicative of a reversal/change of direction in the industry fortunes. And if it is even partly true or possible, how is IFC positioned to protect its business model and revenue/profitability for shareholders ?
The follow up question is that considering these factors, does IFC continue to still present itself as compelling opportunity for a long term investor, as a core position in the portfolio, ignoring everything else as noise ?
Thank You
IFC has been a long time favorite of 5i and stock has performed well, barring the recent softness.
Question is that after 2-3 years of strong performance by P&C sector, do you believe the present weakness to be simply transitionary or it is indicative of a reversal/change of direction in the industry fortunes. And if it is even partly true or possible, how is IFC positioned to protect its business model and revenue/profitability for shareholders ?
The follow up question is that considering these factors, does IFC continue to still present itself as compelling opportunity for a long term investor, as a core position in the portfolio, ignoring everything else as noise ?
Thank You
5i Research Answer:
We continue to like IFC as part of a long-term holding, and while it has seen a drawdown in...