Home insurance is very boring…but rather important. I know some people choose not to bother, but I think this is very foolish. Sadly, home insurance is not particularly cheap. My (until recently) supplier had offered a good product at a sensible price, but pushed the proposed cost up over 30% and was not even willing to negotiate. Having asked a Welsh opera singer for a bit of advice (as you do), I found a more sensible deal. And all this waffle about my very boring personal home economics, brings me to the FTSE 100 giant Aviva (AV.)...
It must be because I spend too much of my time dealing with the global quarterly corporate earnings season that when I see a bunch of UK corporate “trading update” announcements, I know that they will leave more questions unanswered than dealt with. To give the Americans or the Europeans their due, at least every three months any reasonable market cap company will punch out a good quarterly update and a conference call. However, among FTSE 350 names in the UK, good luck hoping for this.
Hello Share Splashers. Insurance can be counted as a defensive investment when times are hard, as they are now. People are drawn to increasing their security when world economies are in trouble. One of the biggest insurers is Aviva (AV.) with a market cap of more than £11 billion. And with size comes strength. Too big to fail?
Back in November I admitted that I still liked holding shares in insurance company Aviva (AV.)HERE. Today’s full year results may include a fall in profitability (thanks to the price-competitive world of life insurance), but…
I have no regrets that I quit as an institutional fund manager six months or so before my 40th birthday. That was over eight years ago now and fortunately in the investment world there is always plenty of new stuff to learn, especially when you can choose to only work with people you like and/or respect. Anyhow it was kind of interesting that the global fund I managed at the time I quit as a 39 year old, had thirty-nine holdings. But as I get older I own fewer positions, though one I still like is Burberry (BRBY).
It might be August, but Thursday is always a busy day for anyone following stock market updates. Today I could write (again) about TUI (TUI) or Entain (ENT) but frankly I said enough on the former back in May, and today’s update may be talking about rising numbers of holidaymakers (but it is still making a loss and has a bunch of corporate debt). Meanwhile the latter has been a really good holding for me over the last 20 months, albeit after a dodgy start. As I previously noted, I still conclude that taking profits over recent months has been very sensible, but it is fine to run a few still (as I do) if you wish. Today though I am going to write more about Aviva (AV.).
It has been a great last year for my investment in Aviva (AV.), shares in which have risen from just over 250p to above 400p in the last month or so. Certainly my view back in February was that the sale of its business in France, Poland, Italy and part of Asia struck me as a very sensible move. The completion of these deals is still set for later in the year – along with the anticipated return of capital. Elsewhere, ‘our positive trading performance in the first quarter of 2021 reinforces our confidence in the targets we announced earlier in the year…we still have much more to do, to deliver stronger returns for our shareholders’, which sounds like good movement.
First some more positive news for Aviva (AV) shareholders. A month ago, here, I discussed the positive decision that the UK listed insurance giant would sell its French business. Today it also announced the sale of its Polish business and yet again it is for a decent amount of money of over Euro 2.5 billion. This means that Aviva is now almost exclusively focused on their UK, Ireland and Canada businesses but also later this year can choose to pay a special dividend or seek to build further its core businesses. Frankly, I would do more of the latter, even if the yield is already c5%. As noted a month ago, I remain positive on this one and have a target share price well above the current 400p level.
An excitable day today as I had my first Covid-19 vaccine (thanks for all those involved including a stock I have not held for years, AstraZeneca (AZN)) and the further progress at Aviva (AV) was very pleasing. As I noted about the latter here, a couple of weeks ago, its simplification process remains strong. For what it is worth, my own target price has risen up by a few more pence above four quid and there is even a 5% plus dividend yield on offer. The shares are still a strong hold for me.
I declared my new FTSE 100 corporate crush a month or so ago here and Amanda Blanc, the newish CEO of insurance giant Aviva (AV.), is starting to deliver. Yesterday’s announcement was that the company has sold its majority shareholding in its Singapore business to a strong sounding consortium for a cool £1.6 billion, which is not too shabby for a middling at best geographic division for a company with a market cap of £11.6 billion. Go that simplification plan!
Hello Share Snafflers. In times of crisis, I like to favour insurance companies. They usually have big reserves and the wave of uncertainty that accompanies disasters means more people buy policies, for which they’re prepared to pay higher prices…
Forget reading the multi-part regulatory news disclosures from insurance behemoth Aviva (AV.) today, just click on the webcast re-run and listen to the first fifteen or twenty minutes presentation by the company’s new CEO Amanda Blanc. It has been a long time since I was so impressed by the initial clarity of expression in a large cap corporate turnaround plan…
Hello, Share Shakers. Though I’ve written recently on how insurance companies may weather the virus crisis, I’ve not before specifically noted shares in Aviva (AV.). I hold some big insurance shares, but not in this jumbo even though I consider it to be one of the best...
I read a good bit of investment advice the other day - yes, despite almost a quarter of a century as some kind of professional investor I am still learning. It noted that 'if you're a very rare trader with edge, you'll act according to your strategy...if you're one of the majority of traders with no edge, this volatility may be revealing'. Goodness I wish I had exhibited sufficient knowledge and accrued insight to have written that. It is very true in my opinion.
If you want to periodically (or even frequently) look like a fool...then I would heartily suggest you engage with the financial markets. As I have discussed on these pages before, a really good batting record is getting seven out of ten calls correct...with the other three losers being curtailed before they get anywhere near joining the fifty percent or worse down club. Anyone who claims a record better than this should either be on the front page of Businessweek or is the next Bernie Madoff.
In the dismal annual results for calendar 2018 published on May 9 Watchstone (WTG), Quindell (QPP) as was, claimed to go into great detail on the various legal cases it faces thanks to the activities of its former boss, the King of the Fraudsters, Rob Terry. Except it didn’t. On April 11 it suffered a massive blow in a C$30 million (£18 million claim if faces in Canada from Aviva. This it omits to mention in its finals but luckily I can bring you full court documents and a release from Aviva’s lawyers below….
Akin to the complete geek I am, I had an answer when recently asked the question which sector was the most difficult to analytically appraise. Forget technology or even biotechnology, my pick would be insurance because unlike the other two areas - which overtly often require specific knowledge - it can sucker you into thinking you have it cracked only to bite you where it hurts in ways and means you barely understand. So onto Aviva (AV.) whose full year numbers came out earlier today – and which has been in the news over recent months for being naughty boys by trying to undertake a compulsory purchase of some of its expensive preference shares…
It never ceases to amaze me what Private Equity firms get away with. We are warned constantly that buying from them often ends in tears but, like moths to a light, the investment community cannot resist handing over other people’s money to them at crazy prices. It looks like Uber and Airbnb are lumbering onto the runway. In 2004 private equity firms, CVC Capital, Permira and Charterhouse bought the AA (AA.) from Centrica for £1.75 billion. Ten years later they borrowed vast amounts of money and paid themselves £2.5 billion in “dividends”…
Hello Share Swirlers. You may already know that I’m a supporter of big insurance groups. My Legal & General (LGEN) investment has risen by 210%, though it's taken five years or so to achieve it. My RSA investment has not been so successful, but it’s still a better performer than most in my bag.
Hello Share Screechers. It was a bonus when I bought some Whitbread (WTB) shares and found I could wangle hotel accommodation at half price. Well, actually, the deal for shareholders is you and yours get a free Sunday at a Premier Inn if you stay on a Saturday night. Up to two rooms are on offer. Here are some other share perks you might like.
Hello Share Swipers. Quite a few insurance policies of mine have been taken over by one firm which seems to flood the market these days. I refer to Aviva (AV.), a firm which knows a lot about generating cash.
In today's podcast I look at the new rules Aviva is implemententing in the name of gender equality. They are not needed and are bad news for all concerned. It is yet another sign of how Britain is losing the plot on capitalism. I then offer up three clear signs that we are at a market top and why it pays to be very wary.
I have flagged up many times before that the Hubio (formerly known as the fraud Himex) and Ingenie operations in Canada faced serious issues because they had simply failed to deliver product as promised to major customers such as Aviva. Now it is out in the open with writs flying both ways. Oh dear...this is not going to end well for Watchstone (WTG), the legacy of fraudster Rob Terry strikes again.
Last week, Tom accused me of bailing on on my 2017 tips as I was too busy dancing naked around the Winterval Pole praying for Gaia to weaken the minds of good people around the world to accept ciimate change. Or something like that, I didn't read it too closely. Now, my role here at ShareProphets is to keep the plates spinning, not make the tips. But that changes today.
So you think blue chip shares are safe? Hat tip to a Mr N Wray from London for the table below which proves that they are not.had you stuck £5,000 into all the stocks in the FTSE 100 10 years ago in 17 cases you would have lost money in absolute terms. The worst investment would be RBS (RBS) where your initial £5,000 would today be worth £191. Other household names such as Tesco (TSCO), Marks & Sparks (MKS) and Aviva (AV.) were just dogs. As the table below shows even supposedly safe blue chips carry risk.
Heck,it may have a new name but it seems that the bury the bad news approach of fraudster Rob Terry still pervades at Watchstone Group (WTG), the company formerly known as Quenron (QPP). Perhaps it would like to tell us about the Canadian lawsuit it picked up this week?
I don’t know who uttered the phrase ‘you cannot eat relative performance’ first but it strikes me as a very relevant statement to describe my first two tips of the year. But I had a big winner. Thank you Greece!
Hello Share Helpers. Not long to go now before Santa calls. But I’m not sure it will as sumptuous a Yule celebration as normal in Stacey Towers. It’s not really been a good year and that applies to most of us, I fear.
Hello Share Spoolers. I've said a few times before that I feel confident investing in British insurers. As financial ventures they are in prime position to benefit from the long, slow rally from the credit crunch of 2008.
I ended my previous write-up on esure (ESUR) with the observation that ‘my conclusion is to leave the shares for other investors. That is – of course – unless it brings that Italian-Welsh mock opera singer back… ‘.
Early August: whilst most think about upcoming or just passed holidays, the last couple of Ashes tests or – for the real geeks amongst you – the finer points of the Bank of England’s big data dump, my mind muses about the 2015 tips I published at the turn of the year. Amusingly enough – as often these things fall – both my main tips reported yesterday: Aviva (AV/) and Randgold Resources (RRS). I will come back on the world’s leading larger cap gold miner later after their conference call but first…the dull world of insurance.
I am not sure if we should all be thinking about the General Election today or not but hopefully I will be able to squeeze in some time to vote given the newsfest frenzy on shares I am interested in around the world. Last month at the epic UK Investor Show I mentioned four UK stocks to the assembled audience (as you can watch here). Three of them usefully gave interesting updates today.
I admit it: I’m a car insurance price tart. When that time of the year comes around again I am more than happy to dump one car insurer for enough at the merest hint of a lower price for my simple cover requirements. I’m pretty sure I have used esure (ESUR) before but frankly I might be wrong – they all blur into one after a while.
How many share tickers can you remember? Of the hundreds that are floating around my head one of my favourites used to be ‘EEEK’ which stood for the eastern / central European focused soft drinks beverage producer/distributor Coca-Cola Hellenic Bottling on the Greek stock market. I have to say ‘used to be’ because in a rare display of austerity the ticker today is a truncated ‘EEE’ which is much less memorable.
Hopefully I don’t need to elaborate on the observation that the global economy has a few problems otherwise at this stage of the economic ‘rebound’ from the dark days of 2007-9 interest rates would be going up. This warped environment favours a different sort of share and – sorry to say for any current employees who will be impacted – but Aviva’s (AV.) cost cutting heavy takeover of Friends Life (FLG) is just the sort of story that has a strong chance of working next year.
There are not many more trading days left in 2014 so inevitably thoughts turn to 2015. I don’t need to elaborate on the observation that the global economy has a few problems otherwise at this stage of the economic ‘rebound’ from the dark days of 2007-9 interest rates would be going up. This warped environment favours a different sort of share and – sorry to say for any current employees who will be impacted – but Aviva's (AV.) cost cutting heavy takeover of Friends Life(FLG) is just the sort of story that has a strong chance of working next year.
The sheer scale of the proposed merger of Aviva (AV.) and Friends Live is a wonder to behold. It reminds us of the extraordinary degree of consolidation that has taken place in the life assurance industry over the last few decades.
Quenron (QPP) earlier this week announced a telematics deal with one of the top three insurance companies in Canada. Of course that was a lie. Quindell has told lies in RNS statements on a serial basis so that is no shock. The partner is Aviva Canada which is in fact the 15th largest insurance company in Canada. It is the third largest player In the Property & Casualty sub sector but what Quenron said in the RNS was just another lie.
The Bulletin Board Morons do not seem to understand that if an Industrial Deafness case is lost Quindell (QPP) earns nothing it just incurs cost. So the mushrooming of bogus claims will not generate any cash for Quenron although it is happily accruing income on the basis that it takes on and wins 6,000 cases a month. Given that the number of claims settles has not risen above 20,000 across the while UK for many years, it is inevitable that at some stage it will have to write back all or nearly all of its accrued income from ID, prompting a profits warning. It will also mean that Quindell runs out of cash. The only question is when?
Quindell’s numbers for accrued revenue on Industrial Deafness will prove to be fantasy, in my opinion. That will mean massive writebacks of revenue and profits already booked, that all earnings forecasts are wrong and that a company threatening cash crisis is on the way by early 2015. Prompted by a former senior Quindell staffer to whom I have been speaking I went “undercover” today to show why.
Oh golly gosh, some folks should not be allowed near shares so great is their misunderstanding of basic accounting. I am not only talking about Laurence Moorse the FD of Quinnovation Group but also the Bulletin Board Morons as well. So – is it okay to accrue? Yes indeed it is sensible to do so. Is all accrual accounting prudent? No.
How much revenue will Quindell book for Industrial Deafness work this year? And how much cash will it earn. The answer according to its own house broker Canaccord is £228.4 million (well over 25% of group sales) and er….zippo. This begs incredibly serious questions about the revenue recognition policies of Quindell in this new, Quindell untested, area.
Aviva (AV.) is 8.6% or so down from its high point of 536p last May. Some in the market have been slightly underwhelmed by the recovery plan thinking that more cost cutting needs to be done; that is to say, doing the right things but not to a great enough extent.