(GuruFocus, June 17, 2009) Investment Guru Chris Davis has added 19.83 % to his position in Transatlantic Holdings (TRH, Financial) . The latest purchase happened on June 8, 2009, on which Chris Davis bought additional shares at the price of $42.98, bring his total holding in the stock to 15,367,728 shares, or 23.15% of the company, according to GuruFocus Data.
Transatlantic Holdings through its wholly-owned subsidiaries Transatlantic Reinsurance Company, Trans Re Zurich, and Putnam offers reinsurance capacity for a full range of property and casualty products on a treaty and facultative basis directly and through brokers to insurance and reinsurance companies in both the domestic and international markets. Transatlantic Holdings Inc. has a market cap of $2.84 billion; its shares were traded at around $42.8 with a P/E ratio of 8.2 and P/S ratio of 0.7. The dividend yield of Transatlantic Holdings Inc. stocks is 1.8%.
This is a very long time holding of Chris Davis: since before 1Q1999, more than ten years ago, Chris Davis owned for his mutual funds 11 million shares of the company. He gradually increased his stake to 15.2 million shares in 1Q06, and since then, he actually sold a very small portion of his shares. He sold about 1.6 million shares in 1Q09, presumably to raise cash in face of the redemption wave, reducing his ownership from 14.4 million shares to 12.8 million shares. The latest purchase on June 8, 2009 increases his position to a historical high.
American International Group (AIG, Financial) through its subsidiaries used to own majority (39 million shares) stake of the international insurance company. On June 10, 2009, AIG sold 29.9 million shares of TRH at the price of $38 per share and still retains 9.1 million shares, according to TRH’s press release. AIG’s sale of shares is a secondary offering and does not bring TRH any proceeds.
AIG’s sale of TRH is apparently part of the grand diversification program to raise cash and deleverage itself. While AIG is selling, Chris Davis and many company insiders are buying: on June 10, 2009, the same day AIG sold its shares, Company Directors Thomas R Tizzio bought 2,000 shares, John L Mccarthy bought 1,000 shares, Richard S Press bought 4,000 shares, and John G Foos bought 3,000 shares of TRH stock at the average price of $38; the price of the stock has increased by 12.63% since.
In a recent Morningstar interview (see transcript , Chris Davis illustrated how he invest money:
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Transatlantic Holdings through its wholly-owned subsidiaries Transatlantic Reinsurance Company, Trans Re Zurich, and Putnam offers reinsurance capacity for a full range of property and casualty products on a treaty and facultative basis directly and through brokers to insurance and reinsurance companies in both the domestic and international markets. Transatlantic Holdings Inc. has a market cap of $2.84 billion; its shares were traded at around $42.8 with a P/E ratio of 8.2 and P/S ratio of 0.7. The dividend yield of Transatlantic Holdings Inc. stocks is 1.8%.
This is a very long time holding of Chris Davis: since before 1Q1999, more than ten years ago, Chris Davis owned for his mutual funds 11 million shares of the company. He gradually increased his stake to 15.2 million shares in 1Q06, and since then, he actually sold a very small portion of his shares. He sold about 1.6 million shares in 1Q09, presumably to raise cash in face of the redemption wave, reducing his ownership from 14.4 million shares to 12.8 million shares. The latest purchase on June 8, 2009 increases his position to a historical high.
American International Group (AIG, Financial) through its subsidiaries used to own majority (39 million shares) stake of the international insurance company. On June 10, 2009, AIG sold 29.9 million shares of TRH at the price of $38 per share and still retains 9.1 million shares, according to TRH’s press release. AIG’s sale of shares is a secondary offering and does not bring TRH any proceeds.
AIG’s sale of TRH is apparently part of the grand diversification program to raise cash and deleverage itself. While AIG is selling, Chris Davis and many company insiders are buying: on June 10, 2009, the same day AIG sold its shares, Company Directors Thomas R Tizzio bought 2,000 shares, John L Mccarthy bought 1,000 shares, Richard S Press bought 4,000 shares, and John G Foos bought 3,000 shares of TRH stock at the average price of $38; the price of the stock has increased by 12.63% since.
In a recent Morningstar interview (see transcript , Chris Davis illustrated how he invest money:
Another category of companies that got very inexpensive were what Peter Lynch used to call the "stalwarts." He used say that you sometimes only get one chance in a decade, sometimes even one chance in a generation, to buy really good companies at 10 or 12 times earnings. The Johnson & Johnsons JNJ, the Diageos, Procter & Gamble PG, Colgate-Palmolive CL. These are some of the great, durable companies with terrific balance sheets, with no need for financing, very durable businesses, high dividend yields.TRH certainly fits the bill: for the past ten year, revenue grew at a rate of 12%, free cash flow grew at a rate of 9%, and book value grew at a rate of 8%.
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