Rude Readers' Haiku Review of 2012:
Damn, you're all some haiku-writin' motherfuckers. The Rude Pundit asked for and received a full facial of little poems, with a couple of hundred sent in so far. He's picking through for ones that give him a little thrill in that electric area of taint-to-balls. It's totally subjective and not fair at all, like capitalism or e-dating. Here's the first bunch. More tomorrow.

From Becca M.:
Electoral Math

Mitt forgot enough
Minorities voting is
A majority

From Larry B.:
Deaf Ears

Election over
America has spoken
Tea bags should listen

From Chris W.:
Didn't want to run
But ran for ten years, because
Dancing horses suck

From Athenawise in New York City
Lonely Star State

Texas: "Let's secede."
The rest of the nation says,
"Good idea. When?"

From BB in Los Angeles
The Pot Calling Anybody Anything

Rush called Fluke a slut.
No birth control needed with
Dominican boys.

From Doug S.:
You want birth control?
Ev'ry day? Close your damned legs!
Here you go, you slut.

From Julia V.
what's more important--
foreclosures or abortions?
we found out this year.

From Phil K. in Wisconsin:
Villain of the Year
Governor Scottie Walker
Koch Brothers sex slave

From Nancy G.:
Wildfire, derecho,
drought, failure of the corn crop:
these are just previews.

From SPL:
Remote drone attack
It's like playing Nintendo
Home by five o'clock

From Sue in California
Fear Not

Pachyderms corralled
Obama stand firm, hit hard
A cliff I fear not

(You can keep sendin' 'em to "")

Prudential Financial PRU stock prediction 2013

Prudential Financial PRU stock prediction 2013 ; Prudential Financial Inc. (PRU), the second-largest life insurer in the U.S., said it expected to earn between $7.50 and $7.90 a share next year, an increase over 2012, driven in part by growth in existing units and the completion of previously announced deals. 

Analysts polled by Thomson Reuters had been predicting operating earnings per share of $7.88 next year on average. Prudential has earned $4.43 per share through the first nine months of 2012 and analysts so far expect $1.75 in the fourth quarter. The earnings guidance was disclosed in a slideshow included in a regulatory filing in advance of Prudential's third-quarter conference call, where executives plan to discuss their outlook for 2013. 

The company, which announced a 10% dividend increase, said it would end the year with "readily deployable capital" of $1.2 billion to $1.5 billion. Share buybacks were one driver of 2013 earnings growth listed by the company in the slides. Prudential also predicted operating return on equity, another measure of profitability, would rise to 12.2% to 12.8% in 2013. 

The company's operating return on equity was 10.2% through the first nine months of this year. The earnings-per-share outlook for next year assumes that interest rates, which have damped returns in investment portfolios across the insurance industry, will stay low. It also assumes the company will complete a previously announced acquisition of a life-insurance business from Hartford Financial Services Group Inc. (HIG) in the first quarter and a large pension transaction in the fourth. 

The tentative model also predicted the price would grow in the first half of 2012 to $52. Therefore, we foresaw a negative correction in March-April. The actual price started to fall in the beginning of May and the monthly closing price for May was at the level of $45 per share. The updated model, as obtained with new data between March and October 2012, predicts a healthy growth in the price in 2012Q4. In January 2013, the price may reach the level of $64. On November 20, the closing price was $50.78. There is some potential of a 10% to 15% return at a three month horizon. One may consider PRU as an investment idea at this horizon.

The model has been obtained using our concept of share pricing as a decomposition of a share price into a weighted sum of two consumer price indices. The intuition is clear - there is a set of goods and services which any company produces and this set defines the share price evolution of a given company relative to other companies.

These other companies are also driven by prices for some goods and services. Hence, for a given company one needs two defining sets of goods and services to estimate its relative pricing power - one related and one as an independent reference. Thus, the relevant stock price can be defined by two CPIs which include corresponding goods and services.

Many SA readers have reasonable doubts that some consumer price, which is not directly related to goods and services produced by a given company, may affect its price. We allow the economy to be a more complex system than described by a number of simple linear relations between share prices and goods. The connection between a firm and its products may be better expressed by goods and services which the company does not produce or provide. The demand/supply balance is fragile and may evolve along many nonlinear paths. It would be too simplistic to directly define a company price only by its own products.

Originally, we addressed the PRU model in 2009 and found two CPIs explaining the monthly closing prices of PRU since 2003. They were the consumer price index of food and beverages (F) and the index of transportation services (TS). The defining time lags were as follows: the food index led the share price by 5 months and the TS index led by 4 months:

PRU(t) = -6.09F(t-5) - 3.15TS(t-4) + 59.76(t-1990) + 930.50, September 2009

In 2010 and 2012, we revisited the original model and estimated new coefficients and lags. These estimates were close to the original ones:

PRU(t) = -5.45F(t-5) - 3.98TS(t-3) + 59.66(t-1990) + 1055.38, September 2010

PRU(t) = -5.14F(t-5) - 3.80TS(t-4) + 56.20(t-1990) + 1005.63, February 2012

Here we revisit the model. We have borrowed the time series of monthly closing prices of PRU from and the relevant (seasonally not adjusted) CPI estimates through October 2012 are published by the BLS. The best-fit model for PRU(t) is as follows:

PRU(t) = -5.09F(t-5) - 3.67TS(t-3) + 55.44(t-2000) + 1531.31, October 2012

where PRU(t) is the PRU share price in U.S. dollars, t is calendar time. One can conclude that the model has not been changing since January 2009 and thus provides a good estimate of the price at a three month horizon.

Figure 1 displays the evolution of both defining indices since 2002.

Figure 2 depicts the high and low monthly prices for a share together with the predicted and measured monthly closing prices (adjusted for dividends and splits). The predicted prices are well within the limits of the high/low share price which might be considered as the actual price uncertainty.

The model residual error is shown in Figure 3 with the standard deviation between July 2003 and October 2012 of $6.01 ($5.58 in March 2012).

Source ref:

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Market Research Australia Insurance Report 2013

Market Research Australia Insurance Report 2013 ; As was the case in our 2012 Annual Report, it is the strengths of Australia's insurance sector that stand out. In most countries, wealth management is an ancilliary activity that is undertaken by life insurers or commercial banks. In Australia, the development over nearly 30 years of the superannuation (pension) fund industry means that wealth management is a core business. Moreover, the superannuation funds, with their roughly AUD1,400bn in assets under management (AUM) continue to grow. They are fed in part by contributions from employers on behalf of employees that are determined by the Superannuation Guarantee (SG) Levy rate. Currently 9% of employees' income, this will rise to 12% by mid-2019.

In the short-term, though, the insurers are responding to a number of changes that have been imposed by the regulator and the Treasury. APRA's Life and General Insurance Capital framework will become effective from the beginning of 2013. Broadly analogous to Solvency II in Europe, it has required all insurers to implement some operational changes. However, both the non-life and the life companies are well capitalised and will be able to cope. For the life insurers, the Stronger Super and the Future of Financial Advice (FoFA) reforms will intensify the downwards pressure on fees and prices. However, over the longer term, they will probably improve the perceptions of the insurance/ wealth management industry in Australia of consumers/investors.

In the recent past, the leading life insurers have been consolidating already strong market positions by exploiting brands or making acquisitions that reinforce their offerings in particular, usually quite rapidly growing areas. Foreign life groups are competing in Australia, but are tending to focus on niches where brand and (established, multiple) distribution channels are less important.

Australia's world-class non-life companies were heavily exposed to natural catastrophes in Australia, New Zealand and elsewhere in early 2011. Given their broad portfolios, they have since been exposed to higher reinsurance costs. However, almost all the non-life companies have been able to achieve (near) double-digit premium growth in H112 relative to H111. Combined operating ratios have generally improved quite dramatically, in part because of the strengthening in prices and rates and in part because of lower claims. Underwriting has been characterised by discipline in a market that is competitive, but which is sufficiently large that a number of players can focus on profitable niches. Meanwhile, QBE, Australia's leading multi-national insurer, continues its overseas expansion by way of acquisition. IAG, for its part, has already developed a substantial commercial footprint elsewhere in the Asia-Pacific. View Full Report Details and Table of Contents

About Fast Market Research
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U.S. Title Insurance industry outlook 2013 by Fitch Ratings

Best Insurance Stock - U.S. Title Insurance industry outlook 2013 by Fitch Ratings : Fitch Ratings maintained its stable rating outlook on the U.S. Title Insurance industry. The outlook reflects a belief that rating actions for the industry will on balance approximate current levels over the next 12 - 18 months as financial performance has improved recently and capital levels remain adequate based on several measures.

A new special report '2013 Outlook: U.S. Title Insurance Industry.' published today highlights key factors affecting title insurer ratings, reviews financial performance in 2012, and assesses industry prospects for 2013.

Operating profit margins on a GAAP basis for Fitch's title universe rose to 10.3 percent in the first nine months of 2012 versus 6.1 percent in the prior year. Earnings improved for all underwriters, but larger players First American Financial (FAF) and Fidelity National Title (FNF) posted the highest margins. Title revenues through nine months 2012 increased by over 15 percent as refinancing activity exceeded expectations and housing markets stabilized. The period's 90.7 percent underwriting combined ratio reached levels unseen since 2006, as growth reduced expense ratios and claims experience improved as well.

The title insurance industry is benefitting from an improving housing market that is showing less home inventory and increasing home prices nationally. According to the National Association of Realtors (NAR), US housing prices rose in 2012 with many markets showing year-over-year home price growth for the first time since the beginning of the housing crisis. Economists attribute the price increase primarily to reduced housing inventory and, to a lesser extent, fewer homes sold in distress.

The Mortgage Bankers Association of America (MBA) forecasts mortgage originations to decline to $1.3 billion in 2013 and just over $1 billion in 2014, compared with $1.7 billion in 2012. The drop is driven by a projected material decline in refinance activity over the next two years, which is expected to be somewhat offset by greater purchase activity.

Fitch continues to view the industry as adequately capitalized, although individual company capital strength varies considerably. Fitch's view is based on both a non-risk adjusted approach such as net written premiums to surplus and a risk adjusted approach via Fitch's Risk Adjusted Capital (RAC) model.

The report '2013 Outlook: U.S. Title Insurance Industry' dated Nov. 26, is available at '' under 'Insurance' and 'Special Reports'.

Prospect Investing in Life Insurance Policies 2013

Best Insurance Stock - Prospect Investing in Life Insurance Policies 2013 , How Investing in Life Insurance Policy 2013 : Are you adequately insured ?  Let this question be asked by every adult income-tax payer in his family. I would like every tax payer to take care of securing his family during the year against  calamity.  One of the best way to protect the family is to adequately insure all the family members. 

It is time now for you not just to count your Life Insurance Policies for different members in the family but to sit down and ponder whether all the family members are adequately insured.  In most cases I am sure the answer that will come in conclusion would be that most of the family members are not adequately insured. 

Many people avoid investing in life insurance simply because they imagine the costs as being too high for their budgets. Fortunately, there are a wide variety of insurance policies available for every set of needs and budgets. Insurance providers provide death benefit payouts ranging from as little as a few thousand dollars all the way up to a few million. Most providers offer more affordable term life insurance policies—term policies have low premiums and payout death benefits for the duration of a specific period.

If low premiums aren’t a priority, the majority of life insurance providers feature coverage plans that accumulate cash value over the life of the policy. With universal and whole insurance it is possible to configure lucrative benefits packages that payout death benefits and can be cashed out or borrowed against like equity.

Hence, during the year 2013 please take a call to answer the question whether you and your family members are adequately insured.  Do not forget to take an insurance policy for your dear loving daughter too. 

What to Look for in a Life Insurance Policy

Policy Benefits
All insurance policies are different. We evaluated insurance providers largely on the variety and flexibility of the life insurance policies they offer. From five year term life insurance to variable universal policies, our leading picks for life insurance providers provide comprehensive coverage for every set of needs.

Pricing and Premiums
Premium payments are going to be different with different providers depending on risk factors such as your health, lifestyle, age and occupation. In general, insurance providers receiving a high score on our site gave more lucrative quotes than competitors regardless of age or lifestyle.

Additional Services
Life insurance is a must, but there are many other services we expect to see available in addition to, or as an alternative to, life insurance. Annuities, retirement planning, estate planning, mutual funds and plans tailored for small business are services we expect from the best providers.

Customer Support
Red tape and poor customer service are the last things a grieving family member wants to deal with. Our top picks for life insurance provider boast excellent customer service, approach claims in a timely and professional manner and go out of their way to meet customer expectations.

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Travelers Companies (NYSE: TRV) stock rating by thestreet ratings

Best Insurance Tock - Travelers Companies stock rating by thestreet ratings : The Travelers Companies, Inc. (TRV) is a holding company. The Company, through its subsidiaries, is engaged in providing a range of commercial and personal property and casualty insurance products and services to businesses, Government units, associations and individuals., reiterated their buy rating on shares of The Travelers Companies (NYSE: TRV) in a research report sent to investors on Friday morning.

TRV has been the subject of a number of other recent research reports. Analysts at RBC Capital upgraded shares of The Travelers Companies from an outperform rating to a top pick rating in a research note to investors on Monday, December 17th. They now have a $87.00 price target on the stock, up previously from $85.00. Separately, analysts at Sanford C. Bernstein reiterated a market perform rating on shares of The Travelers Companies in a research note to investors on Thursday, December 6th. They now have a $77.00 price target on the stock. Finally, analysts at Zacks downgraded shares of The Travelers Companies from an outperform rating to a neutral rating in a research note to investors on Monday, November 26th. They now have a $75.00 price target on the stock.

The Travelers Companies traded down 0.17% on Friday, hitting $71.70. The Travelers Companies has a 1-year low of $55.86 and a 1-year high of $74.70. The stock’s 50-day moving average is currently $71.43. The company has a market cap of $27.350 billion and a price-to-earnings ratio of 10.25.

The Travelers Companies last announced its earnings results on Thursday, October 18th. The company reported $2.22 earnings per share for the quarter, beating the analysts’ consensus estimate of $1.54 by $0.68. The company’s quarterly revenue was up .4% on a year-over-year basis. On average, analysts predict that The Travelers Companies will post $5.53 earnings per share for the current fiscal year.

To view TheStreet’s full report, visit
A Haiku Review of 2012, Part 2: Gun Crazy:
(Yesterday, the Rude Pundit began his annual attempt to encompass the year in as few words as possible. And he invited rude readers to send in their own haiku as 2012 gasps its last breaths. So far, he's gotten an Iliad's worth of verse, and he wants more. Keep those haiku a-coming. Send 'em to "" and the best will be posted on Monday and Tuesday. Now, on with the show...)

Death in Florida
Trayvon was shot dead.
The NRA backed up George.
Can't blacks stand their ground?

Death in Colorado
Crazy-eyed coward.
Theater of sitting ducks.
Joker would be pleased.

Death in Wisconsin
Hate crime against Sikhs
By a racist thug who bought
his gun legally.

Death in Chicago

More murdered children
By guns than Newtown times six.
One year, one city.

Death in Newtown

The funeral home
Laid to rest eleven kids,
Didn't take a dime.
A Haiku Review of 2012 (and an Invitation to Haiku, Too):
For something like the 78th time in a row, the Rude Pundit is ending a year by going back to basics, ancient basics, and stemming the vomit of words that normally issues forth for something quieter. Yep, it's haiku time, where for a couple of days the Rude Pundit and rude readers look back on the awful and the wonderful of the dying year in brief poem form.

Part 1: Yes, That Election Happened

Not Newt
For some odd reason
Pundits thought Gingrich would win.
Blind men don't see bombs.

Enough Frothing
Santorum sought to
Secure the crazy voters.
Bachmann said, "Not me?"

Revenge of a Lost Romney
Up in dog heaven
Seamus is laughing out loud.
Who needs shit hosed now?

Rafalca Shook Her Head
Camp Romney tried hard
Too make an ass a stallion.
Voters know a fake.

Why "Why?" Is Easy

Obama trounced Mitt
In ways that boggled the right.
Facts do matter, Fox.

Why "Why?" Is Easy II
It seems that women
Like body freedom, hate rape.
Repubs don't get that.

The Rude Pundit will have more coming soon. But he's inviting you, oh, sweet readers, to submit your own haiku about 2012. For instance, leaping to the front of the line is Mona P., who sent in this little number:

Playing Chicken With 2013
Dodged the Mitt bullet
Blew past the Mayan doomsday.
Fiscal cliff? Yee Haa!

See? That's simple. One line of five syllables, one line of seven, a last line of five. You don't need to send a title or a bribe, although both are welcome. Email your haiku to "". The best'll be tossed up here Monday and, perhaps, Tuesday.

W.R. Berkley insurance stock Rating prices target

Best Insurance Stock - W.R. Berkley insurance stock Rating prices target : Zacks reiterated their neutral rating on shares of W.R. Berkley (NYSE: WRB) in a research note issued to investors on Wednesday. The firm currently has a $41.00 target price on the stock.

Zacks’ analyst wrote, “Berkley posted third-quarter earnings ahead of the Zacks Consensus Estimates on the back of higher premium written, pricing gains, higher investment income and a lower share count. Year-to-date, the company has performed favorably and we expect the trend to continue. Berkley is witnessing stable retention and a general rate hike for the seventh consecutive quarter. 
We believe that the insurance pricing cycle has entered a safe zone and the magnitude of the price rise will increase going forward. Berkley’s investments in a number of start-ups during the last four years will enable it to take greater advantage of the improved market scenario. Its International business is another area, which will fuel long-term earnings growth. A strong balance sheet and disciplined capital management are other positives. However, rising loss trends and a low interest rate environment keep us on the sidelines.”

A number of other analysts have also recently weighed in on WRB. Analysts at Deutsche Bank cut their price target on shares of W.R. Berkley from $34.00 to $33.00 in a research note to investors on Monday, December 17th. They now have a sell rating on the stock. Separately, analysts at RBC Capital downgraded shares of W.R. Berkley from an outperform rating to a sector perform rating in a research note to investors on Monday, December 17th. They now have a $45.00 price target on the stock, up previously from $42.00. Finally, analysts at Goldman Sachs downgraded shares of W.R. Berkley from a neutral rating to a sell rating in a research note to investors on Tuesday, October 2nd. They now have a $35.00 price target on the stock. They noted that the move was a valuation call.

W.R. Berkley traded down 1.55% on Wednesday, hitting $38.00. W.R. Berkley has a 52-week low of $33.34 and a 52-week high of $40.39. The company has a market cap of $5.161 billion and a price-to-earnings ratio of 11.86.

W.R. Berkley last posted its quarterly earnings results on Monday, October 22nd. The company reported $0.61 earnings per share for the quarter, beating the analysts’ consensus estimate of $0.55 by $0.06. The company’s revenue for the quarter was up 11.0% on a year-over-year basis. On average, analysts predict that W.R. Berkley will post $2.49 earnings per share for the current fiscal year.

The company also recently announced a special dividend, which is scheduled for Monday, December 31st. Stockholders of record on Monday, December 24th will be paid a dividend of $1.00 per share. The ex-dividend date is Thursday, December 20th.

W. R. Berkley Corporation (W. R. Berkley) is an insurance holding company. The Company operates in five segments of the property casualty insurance business: Specialty, Regional, Alternative markets, Reinsurance and International.

W. R. Berkley stock prices target, W. R. Berkley  stock rating neutral, zack Analysts W. R. Berkley stock rating, Analysts at Deutsche Bank,

HCC Insurance Ex-Dividend Date Scheduled for December 28, 2012

Best insurance stock - HCC Insurance Ex-Dividend Date Scheduled for December 28, 2012 : HCC Insurance Holdings, Inc. ( HCC ) has announced an ex-dividend date of December 28, 2012 and a cash dividend payment of $0.165 per share scheduled for January 16, 2013. Shareholders who purchased HCC stock prior to the ex-dividend date are eligible for the cash dividend payment. This represents an 6.45% increase over the same period a year ago. At the current stock price of $37.24, the dividend yield is 1.77%.

The previous trading day's last sale of HCC was $37.24, representing a -1.09% decrease from the 52 week high of $37.65 and a 39.89% increase over the 52 week low of $26.62.

HCC is a part of the Finance sector, which includes companies such as American International Group, Inc. ( AIG ) and The Travelers Companies, Inc. ( TRV ). HCC's current earnings per share, an indicator of a company's profitability, is $3.5. Zacks Investment Research reports HCC's forecasted earnings growth in 2012 as 31.07%, compared to an industry average of 5.8%.

AIG Insurance stock prices prediction 2013

AIG Insurance stock prediction 2013 : American International Group, Inc. (AIG) is a leading international insurance organization serving customers in more than 130 countries. AIG companies serve commercial, institutional and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies are leading providers of life insurance and retirement services in the United States. AIG Common Stock, par value $2.50 per share (AIG Common Stock), is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. 

AIG is an insurance conglomerate that spans the globe, but during the great recession like many other giant financial institutions, AIG got itself into a lot of trouble taking on the counter-party risk of mortgage backed securities. During the 4th quarter of 2008, AIG set the world record for reporting the biggest loss. It lost $99.3 billion dollars in a single quarter.

The company currently operates one of the largest insurance networks in the world, with more than 85 million clients in 130 countries. AIG is split into four business divisions: Chartis, SunAmerica Financial Group, Aircraft Leasing, and other operations.

Chartis offers a unique portfolio of insurance products and services. The insurance products are: casualty, property, financial lines, and specialty. Chartis conducts its business through multiple entities such as: New Hampshire Insurance Company, American Home Assurance Company, Lexington Insurance Company, AIU Insurance Company, Chartis Overseas, Fuji Fire & Marine Insurance Company Limited, Chartis Europe Holdings Limited, and Chartis Europe.

SunAmerica Financial Group - offers a comprehensive suite of products such as: term life, universal life, fixed/variable annuities, mutual funds, financial planning. The SunAmerica Financial Group operates under these subsidiaries: American General Life Companies (American General), Variable Annuity Life Insurance Company (Western National), SunAmerica Retirement Markets (SARM).

AIG's other operations primarily consisted of derivatives trading, and aircraft leasing. The other operations: International Lease Finance Corporation, AIG Markets, United Guaranty Corporation, AIG Financial Products, and AIG Trading Group Inc.

Currently AIG generates 91% of its revenue through the SunAmerica Financial Group, and Chartis. 

AIG's current management strategy remains simple: by 2015 achieve return on equity above 10%, generate share growth in mid-teens, grow insurance divisions, and reinvest retained earnings.

AIG aggressively competes with Berkshire Hathaway (BRK.A/BRK.B), The Travelers Companies (TRV), Chubb (CB), Allstate (ALL), Loews (L), Progressive (PGR), Hartford Financial Services (HIG), CNA Financial (CNA), among many others.

Technical Analysis AIG insurance 2013
The stock has been on a continuous up-trend since November 2012. On 12/24/2012 the stock is between a very narrow symmetrical triangle formation. I anticipate the stock to break out no later than the 26th or 27th, meaning that the stock will be forced to make a major move.
Source: Chart from

The stock is trading above the 20-, 50-, and 200- Day Moving Averages. The stock will experience further upside through 2013, as investors have under-bought the growth prospects of the company.

Notable support is $23.00, $27.30, and $30.60 per share.
Notable resistance is $37.50, $46.00, and $60.00 per share.

Street Assessment
Analysts on a consensus basis have high expectations for the company going forward.

Growth Est
S&P 500
Current Qtr.
Next Qtr.
This Year
Next Year
Past 5 Years (per annum)
Next 5 Years (per annum)
Price/Earnings (avg. for comparison categories)
PEG Ratio (avg. for comparison categories)
Source: Table and data from Yahoo Finance

Analysts have high expectations, as analysts on a consensus basis have a 5-year average growth rate forecast of 21.93% (based on the above table). This growth rate is above the industry average for next 5-years (13.20%).
Earnings History
EPS Actual
Surprise %
Source: Table and data from Yahoo Finance

The average surprise percentage is 44% above analyst forecast earnings over the past four quarters (based on the above table).

Forecast and History AIG Insurance
Basic EPS
P/E Multiple
$ 3.10
$ 3.77
$ 4.03
$ 5.38
$ 2.40
$ (37.84)
$ (93.69)
$ 14.75
$ 8.60
$ 3.74
Source: Table created by Alex Cho, data from shareholder annual report

The EPS figure shows that throughout the 2003-2006 period earnings were growing due to favorable economic conditions. Then the company was adversely affected by the great recession throughout 2007-2009, as the net income rapidly declined, and AIG eventually logged the biggest loss in corporate history. During 2010 the company was able to generate a profit by restructuring the company; this involved selling business units, which inflated earnings by $17.7 billion dollars. Once the United States economy exited the recession in 2010-2012 the company earnings have improved, albeit gradually. In 2011 the abnormal earnings of $8.60 were due to a provisional benefit from taxes worth $18.03 billion dollars. The improvements in net income for 2010-2011 were one-time events and should not be considered a part of the long-term earnings growth trend. So in essence, 2012 is likely to be the most normal year for AIG over the past 5 years.
Source: Table created by Alex Cho, data from shareholder annual report

By observing the chart we can conclude that the business is somewhat cyclical and is affected by macroeconomics. Therefore one of the largest risk factors to AIG is the slowing of international gross domestic product growth. So as long as the global economy continues to grow, the company will generate reasonable returns over a 5-year time span based on the forecast below.

AIG Stock Prices Forecast Next 5 Year
Source: Forecast and table by Alex Cho

By 2018 I anticipate the company to generate $10.19 in earnings per share. This is because of earnings growth, improving global outlook, earnings management and continued development overseas.

The forecast is proprietary, and below is a non-linear chart indicating the price of the stock over the next 5-years.
AIG Stock Chart Forecast Next 5 Year
AIG Stock Chart Forecast Next 5 Year
Source: Forecast and chart by Alex Cho

Below is a price chart incorporating the past 10 years and the next 6 years. Detailing 16 years in pricing based on my forecast and price history on December 31st of each year.

Source: Forecast and chart created by Alex Cho, data from shareholder annual report, and price history is from Yahoo Finance.

*The period 2003-2008 were price quotes based on pre-split stock prices (multiply by 20 to accurately calculate the price of the shares between 2003 and 2008). On 7/01/2009 the stock had a 1:20 split (reverse split).

Investment Strategy AIG Insurance

AIG currently trades at $35.20. I have a price forecast of $37.94 for 2013. AIG is in a long-term up-trend. I anticipate momentum in the price of the stock, as the growth rate offers compelling stock appreciation for the foreseeable future.

Short Term
Over the next twelve months, the stock is likely to appreciate from $35.20 to $38.60 per share. This implies 9.6% upside from current levels. The technical analysis indicates an up-trend (break above the symmetrical triangle formation). While the previously mentioned price forecast using fundamental analysis further supports the trade set-up.

Investors should buy AIG at $35.20 and sell at $38.60 to pocket short-term gains of 9.6% in 2013. This return is pretty measly, meaning that short-term investors would likely do better investing in other opportunities.

Long Term
The company is a great investment for the long-term. I anticipate AIG to deliver upon the price and earnings forecast despite the risk factors (macroeconomic, competition, etc.). AIG's primary upside catalyst is international development, and earnings management. I anticipate the company to deliver upon my forecasted price target of $100.12 by 2018. This implies a return of 185% by 2018. This rate of return is exceptional, considering AIG has a market capitalization of $52B. The extra liquidity makes this a compelling growth investment for institutional investors who require higher liquidity.

Conclusion buy AIG Stock
Buy AIG on long-term growth. AIG has not died off the surface of the earth; it is more stubborn than a roach. The conclusion remains simple: buy AIG.

Articel copyright by Alex cho - published by

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Things That Brought the Rude Pundit Unmitigated Joy in 2012:
The Rude Pundit is giving his brain and soul a day off from thinking about pushing the NRA off the fiscal cliff or whatever the hell is going on out there. Instead, he's doing a non-political thing here, a kind of year-in-review thing, but instead of listing ten movies you can scoff at, this is a bit more personal. Here's some moments in cultural type things that were little rays of light for the Rude Pundit in the dark tunnel of 2012:

1. In the movie tent at the end of the Bonnaroo Music Festival in Tennessee in June, with the band fun. and two others groups loudly echoing around, the Rude Pundit sat with two great friends and about fifty other people and watched Beasts of the Southern Wild. And all of the noise and exhaustion faded away. This was something unexpected, strange, and magical, and, by the end, so beautiful and true, that, when the lights came up, we three grown men were crying, as was pretty much everyone else in the tent. No film this year came close to inducing that kind of visceral feeling.

2. "Take a Walk" by Passion Pit is a pop song with teeth about men who, frankly, could only afford to eat at Taco Bell. The story of people suffering in the recession, it climaxes with this bridge that describes the Tea Party generation about as well as any song:

Honey it’s your son
I think I borrowed just too much
We had taxes, we had bills
We had a lifestyle to front
And tonight I swear I'll come home
And we’ll make love like we’re young
Tomorrow you’ll cook dinner
For the neighbors and their kids
We could rip apart those socialists
And all their damn taxes
You’ll see I am no criminal
I’m down on both bad knees
I’m just too much a coward
To admit when I’m in need

So why is this in a list of joy? Because it's all set to a bouncy, driving tune with a chorus that won't leave your head and, truly, you won't mind. (Bonus song: "Christmas in the Room" by Sufjan Stevens)

3. In the encore of his first concert ever at the Prudential Center in Newark, Bruce Springsteen picked up a sign from the audience that said, "Play one for Levon." He walked around to the E Street Band and talked it over, going through some quiet chord changes, and then he said that he hadn't played this song since his bar days and that this was for Levon Helm. Yeah, Bruce Springsteen played "The Weight" as a singalong for 20,000 people, and it was one of those moments where there was nowhere else on earth you wanted to be. (Concert runners-up: The Kills at Terminal 5 in NYC and The Roots at Bonnaroo)

4. The play We Are Proud to Present a Presentation About the Herero of Namibia, Formerly Known as Southwest Africa, From the German Sudwestafrika, Between the Years 1884-1915 at the Soho Rep in New York. More than any other theatre this year, this work by Jackie Sibblies Drury, about a group of self-involved actors trying to figure out how to do a play about the first genocide of the 20th century, consistently surprised its audience with its shifting tones and perspective.

5. The conversation between Jon Stewart and Stephen Colbert at the Wellmont Theatre in Montclair, New Jersey was not really about politics (or Hugh Grant). But it was two incredibly smart, incredibly funny men sitting on stage and talking about how they conceive of and create their shows for over two hours. Now that was some bliss.

Zack China Life Insurance stock rating prices target $49.00

Best Insurance Stock - China Life Insurance stock rating prices target $49.00 : Zacks reiterated their neutral rating on shares of China Life Insurance (NYSE: LFC) in a research report sent to investors on Friday morning. The firm currently has a $49.00 price target on the stock.

Zacks’ analyst wrote, “China Life reported a net loss in the third quarter, due to a surge in operating expenses, which offset the operating income increases. However, premiums earned and investment income witnessed a notable improvement. Total assets and shareholders’ equity also improved, while cash fund deteriorated. Meanwhile, the subordinated debt issue has improved solvency ratio. 

Extensive domestic distribution channel, strong investment and stable ratings are other positives. However, the constant decline in operating cash flow is affecting financials. The company also inherently faces substantial interest rate and currency risks, which limit the upside. Despite a strong brand name, significant competition on the domestic front hampers earnings growth. Overall, we expect limited upside in the near term.”

Shares of China Life Insurance traded down 0.43% during mid-day trading on Friday, hitting $46.16. China Life Insurance has a 52 week low of $33.00 and a 52 week high of $47.39. The company has a market cap of $84.896 billion and a P/E ratio of 60.60.

Health insurance rate review authority by Montana State

Best insurance stock option today - Review Authority Health Insurance Rate : Despite changes in federal regulations, health-care costs are still a concern for most Montanans. However, legislation proposed for this coming Montana legislative session could help ensure that all Montanans will at least be treated fairly by insurance companies looking to increase their rates.

The legislation, House Bill 87, which is being promoted by Montana State Auditor Monica Lindeen and sponsored by Rep. Jeff Welborn, R-Dillon, will give Lindeen’s office review authority for insurance rate increases. This might seem to be a minor issue, but Montana is only one of three states that currently have no authority to review insurance rate increases, Lindeen said.

As state auditor, Lindeen has the authority to review insurance rates in all other categories includ-ing home, auto and life. This has allowed her to reduce rate increases that have seemed too unjusti-fiably high.

It also allows her to make sure rate increases are legal, said Lindeen spokesman Lucas Hamilton.

The lack of review authority also gives insurance companies the ability to take advantage of Mon-tanans. Lindeen sites a recent example where a health insurance company proposed rate increases around the country. The average increase was 18 percent, but in some cases customers saw their rates increase by 50 percent.

These rates were challenged by Montana’s neighbor South Dakota, which has health insurance rate review authority. South Dakota negotiated a lower rate increase with this particular insurance company on behalf of its citizens. Montana wasn’t allowed the same benefit and customers of that particular insurance company were forced to accept the rate increases with no discussion.

Another benefit to the rate review authority is that it benefits the health insurance industry as a whole in Montana by bringing fairness to the marketplace. Lindeen will have the authority to review rates that are too low and attempt to undercut the market, said Blue Cross and Blue Shield of Montana spokesman Fred Cote.

Without state review authority, insurance companies could run rates much lower than the market standard, upsetting the balance in the market and also running the risk of becoming insolvent, Cote said.

For the health insurance industry it will provide an independent review of rates, which will help consumers ensure the increases are justified, he said. This is a bill that Cote said Blue Cross and Blue Shield will support.

The federal government, through the Affordable Care Act, also has health insurance rate review authority when rates increase by at least 10 percent. However, the local review authority is a better option for Montanans because local regulators will better understand local markets.

During the 2011 legislative session, a similar bill was tabled in the House Business and Labor Committee after a compromise was reached between the auditor’s office and a handful of Montana health insurance companies along with the Montana Chamber of Commerce and the Montana Small Business Alliance. Mysteriously, this commonsense bipartisan legislation was a casualty of the opposi-tion to President Barack Obama’s Affordable Care Act.

HB 87 represents the same compromised bill from the last session. Let’s hope this time around legislators can see the benefits for Montanans and give the state auditor the review authority her office needs.

Source :

Hiscox insurance Stocks outlook 2013

Best Insurance Stock - Hiscox insurance Stocks outlook 2013 : Hiscox estimates Sandy net claims of approximately £90 millio n for the impact of sandy, international specialist insurer Hiscox has today announced an estimate for the impact of Superstorm Sandy. Although considerable uncertainties still exist around the impact of Superstorm Sandy, the insurer said that based on an insured market loss of $20bn, it estimates net claims of approximately £90m. Superstorm Sandy hit parts of North America and Canada in October causing destruction of buildings and infrastructure. Twice a year Hiscox publishes its expected losses for modelled catastrophes including exposure to US windstorm. The insurer stated that the estimate was within the published range, and was within Hiscox's overall budgeted loss expectations for the year.

Key Statistics for HSX

Current P/E Ratio (ttm)7.7493
Estimated P/E(12/2012)10.5669
Relative P/E vs. UKX0.5056
Earnings Per Share (GBP) (ttm)0.6013
Est. EPS (GBP) (12/2012)0.4410
Est. PEG Ratio0.1110
Market Cap (M GBP)1,837.35
Shares Outstanding (M)394.28
30 Day Average Volume333,287
Price/Book (mrq)1.3739
Price/Sale (ttm)1.4734
Dividend Indicated Gross Yield3.84%
Cash Dividend (GBp)6.0000
Last Dividend08/08/2012
5 Year Dividend Growth10.23%
Next Earnings Announcement02/25/2013

About Hiscox Insurance Company Inc.
Hiscox Insurance Company Inc. provides animal mortality insurance products for animal owners in the United States and internationally. The company offers insurance coverages for horses and registered cattle, including full mortality, limited perils, special accident, prospective foal, mare guaranteed conception, colic surgery, and emergency surgery reimbursement solutions. It provides its products through agent representatives and online sellers. 

The company was formerly known as American Live Stock Insurance Company, Inc. and changed its name to Hiscox Insurance Company Inc. in December 2007. The company was founded in 1952 and is based in Geneva, Illinois. Hiscox Insurance Company Inc. operates as a subsidiary of Hiscox, Ltd.

416 South 2nd Street Geneva, IL 60134 
United States Founded in 1952
Phone: 630-232-2100
Fax: 630-232-2292
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