It’s been a grueling five post-financial-crisis years for American Funds, but things are finally starting to look up for the mutual fund company, a favorite of advisers.
American Funds, which is owned by The Capital Group Cos. Inc, was the largest mutual fund company in the world before Lehman Brothers Holdings Inc. collapsed and set off a chain reaction that caused global stock markets to plummet. But its funds, which famously avoided the bursting of the tech bubble, were merely average in 2008 when the financial crisis started to break.
That performance letdown has led to a half-decade in which advisers have fled both stocks in favor of bonds and active managers in favor of index funds. As a result, stock-fund heavy American Funds has seen almost $250 billion of net withdrawals since 2008, dropping it behind the Vanguard Group Inc. and Fidelity Investments in the mutual fund company pecking order.
Top 5 Insurance Companies To Buy Right Now: First American Financial Corp (FAF)
First American Financial Corporation, incorporated on January 14, 2008, through its subsidiaries, is engaged in the business of providing financial services through its title insurance and services segment and its specialty insurance segment. The Company operates in two segments: title insurance and services and specialty insurance.
The title insurance and services segment provides title insurance, closing and/or escrow services and similar or related services domestically and internationally in connection with residential and commercial real estate transactions. It also maintains, manages and provides access to title plant records and images and provides banking, trust and investment advisory services. The specialty insurance segment issues property and casualty insurance policies and sells home warranty products. In addition, its corporate function consists of certain financing facilities as well as the corporate services that support its business operation s.
Title Insurance and Services Segment
The Company’s title insurance and services segment issues title insurance policies on residential and commercial property in the United States and offers similar or related products and services internationally. This segment also provides closing and/or escrow services; accommodates tax-deferred exchanges of real estate; maintains, manages and provides access to title plant records and images, and provides banking, trust and investment advisory services. The Company conducts its title insurance and closing business through a network of direct operations and agents. Through this network, it issues policies in the 49 states that permit the issuance of title insurance policies and the District of Columbia. The Company also offers title insurance, closing services and similar or related products and services, either directly or through third parties in foreign countries, including Canada, the United Kingdom, A ustralia and various other markets.
The Company! distributes its title insurance policies and related products and services directly as well as through its agents through various channels. Its federal savings bank subsidiary offers trust and investment advisory services, deposit services and asset management services. As of December 31, 2012, the Company provides products and services in numerous countries outside of the United States, and its international operations accounted for approximately 7.9% of its title insurance and services segment revenues
Specialty Insurance Segment
The Company’s property and casualty insurance business provides insurance coverage to residential homeowners and renters for liability losses and typical hazards, such as fire, theft, vandalism and other types of property damage. The Company is licensed to issue policies in all 50 states and the District of Columbia and actively issue policies in 43 states. In its market, California, it also offers preferred risk aut o insurance to better compete with other carriers offering bundled home and auto insurance. Reinsurance is used to limit risk associated with natural disasters, such as windstorms, winter storms, wildfires and earthquakes.
The Company’s home warranty business provides residential service contracts that cover residential systems, such as heating and air conditioning systems, and certain appliances against failures that occur as the result of normal usage during the coverage period. Most of these policies are issued on resale residences, although policies are also available in some instances for new homes. Coverage is typically for one year and is renewable annually at the option of the contract holder and upon its approval. It sells renewals directly to consumers. As of December 31, 2012, home warranty business operates in 39 states and the District of Columbia.
The Company competes with Fidelity National Financial, Inc., Stewart Title Guaranty Com pany, Old Republic International Corporation and Lender Proc! essing Se! rvices, Inc.
- [By Marc Bastow]
The biggest increase among our dividend stocks this week came from title and specialty insurance management company First American Financial (FAF), which raised its quarterly dividend 100% to 24 cents per share, payable June 16 to shareholders of record as of June 9.
FAF Dividend Yield: 3.47%
- [By alicet236]
First American Financial Corp (FAF): CEO Dennis J Gilmore sold 116,453 Shares
CEO of First American Financial Corp (FAF) Dennis J Gilmore sold 116,453 shares on 02/04/2014 at an average price of $25.12. First American Financial Corporation was incorporated in the state of Delaware in January 2008 to serve as the holding company of The First American Corporation’s financial services business. First American Financial Corp has a market cap of $2.7 billion; its shares were traded at around $25.52 with a P/E ratio of 12.30 and P/S ratio of 0.56. The dividend yield of First American Financial Corp stocks is 1.88%.
- [By Canadian Value]
Position % of Fund Assets 1) First American Financial Corp. (FAF) 7.0% 2) Apple, Inc. (AAPL) 6.5% 3) Coinstar, Inc. (CSTR) 4.8% 4) EMC Corp. (EMC) 4.4% 5) Coach, Inc. (COH) 4.4% 6) Kohl’s Corp. (KSS) 4.1% 7) Blucora, Inc. (BCOR) 4.0% 8) Tetra Tech, Inc. (TTEK) 3.1% 9) OM Group, Inc. (OMG) 3.0% 10) American International Group, Inc. (AIG) 2.8% TOTAL 44.1% One area that we believe still offers some value in the market is in high quality, large‐cap technology stocks that may be momentarily out‐of‐favor as they transition from rapid growth to slower growth. In particular, we become interested when that transition is also accompanied by a change in capital allocation policies designed to return more cash to shareholders in the form of dividends and share repurchases. We believe that Apple and EMC are two of the absolute highest quality technology businesses in the world and both have recently announced very material, shareholder‐ friendly changes to how they will alloc ate capital.
Top 5 Insurance Companies To Buy Right Now: MBIA Inc (MBI)
MBIA Inc. (MBIA), incorporated on November 12, 1986, together with its consolidated subsidiaries, operates the financial guarantee insurance businesses in the industry and is a provider of asset management advisory services. These activities are managed through three business segments: United States public finance insurance, structured finance and international insurance, and advisory services. The Company’s United States public finance insurance business is operated through National Public Finance Guarantee Corporation and its subsidiaries (National), its structured finance and international insurance business is primarily operated through MBIA Insurance Corporation and its subsidiaries (MBIA Corp.), and its asset management advisory services business is primarily operated through Cutwater Holdings, LLC and its subsidiaries (Cutwater). It also manages certain business activities through its corporate, asset/liability products, and conduit segments. The corporate segment includes revenues and expenses that arise from general corporate activities. Funding programs managed through the asset/liability products and conduit segments are in wind-down.
MBIA Corp. owns MBIA UK Insurance Limited (MBIA UK), a financial guarantee insurance company that is regulated and supervised by the Financial Services Authority (FSA) in the United Kingdom and is authorized to carry out insurance business in the United Kingdom and in the European Economic Area on a cross border services basis. Its financial guarantee insurance generally provides investors with an unconditional and irrevocable guarantee of the payment of the principal, interest or other amounts owing on insured obligations when due or, in the event that the Company has the right at its discretion to accelerate insured obligations upon default or otherwise, upon its election to accelerate. The Company conducts its financial guarantee business, as well as related reinsurance, advisory and portfolio services, through its subsidiaries National Publi! c Finance Guarantee Corporation (National), its United States (United States) public finance-only financial guarantee company, and MBIA Insurance Corporation and its subsidiaries (MBIA Corp.), which write global structured finance and non-United States public finance financial guarantee insurance.
The Company’s United States public finance insurance business is conducted through National, and its structured finance and international insurance operations are conducted through MBIA Corp. and its subsidiaries. It also issue insurance policies to guarantee the payment of principal and interest on municipal obligations being traded in the secondary market upon the request of a broker or an existing holder of uninsured bonds, where premium is generally paid by the owner of the obligation. In addition, the Company has provided financial guarantees to debt service reserve funds. The primary risk in its insurance operations is that o f adverse credit performance in the insured portfolio. It seeks to maintain a diversified insured portfolio and have designed each insured portfolio with the aim of managing and diversifying risk based on a range of criteria, including revenue source, issue size, type of asset, industry concentrations, type of bond and geographic area.
Through the Company’s reinsurance of United States public finance financial guarantees from MBIA Corp. and Financial Guaranty Insurance Company (FGIC), National’s insurance portfolio consists of municipal bonds, including tax-exempt and taxable indebtedness of United States political subdivisions, as well as utility districts, airports, health care institutions, higher educational facilities, student loan issuers, housing authorities and other similar agencies and obligations issued by private entities that finance projects that serve a substantial public purpose. Municipal bonds and privately issued bonds used for the fina ncing of public purpose projects are generally supported by ! taxes, as! sessments, user fees or tariffs related to the use of these projects, lease payments or other similar types of revenue streams. As of December 31, 2012, MBIA Corp. had 899 policies outstanding in its insured portfolio. In addition, MBIA Corp. had 199 insurance policies outstanding relating to asset/liability products liabilities issued by MBIA Inc. and its subsidiaries.
In the Company’s asset management advisory services business its registered investment advisors provide fixed-income asset management services for third parties and the investment portfolios of the Company and its affiliates (including the wind-down businesses) on a fee-for-service basis. Its advisory services are offered in two product lines, traditional and structured. Within the traditional product line, Cutwater offers cash management, customized asset management, discretionary asset management and fund accounting services to governments, insurance companies (including the Company’s insurance subsidiaries), corporations, pension funds, unions, endowments, foundations and investment companies in both pooled and separate account formats. These services are offered through registered investment advisers, and Cutwater receives asset management and administrative fees as compensation. Within the structured product line, Cutwater manages asset/liability programs and conduits (the wind-down businesses), Collateralized debt obligations (CDOs) and other funding vehicles for banks, insurance companies, program trustees and investment companies, and it earns base and performance fees for its services. Cutwater’s advisory services are offered through two principal operating subsidiaries: Cutwater Asset Management Corp. (Cutwater-AMC), an SEC-registered investment adviser and Financial Industry Regulatory Authority (FINRA) member firm, and Cutwater Investor Services Corp. (Cutwater-ISC), an SEC-registered investment adviser.
< p>Wind-down Business
The asset/liability produc! ts busine! ss historically raised funds for investment through two sources, such as issuance of customized investment agreements by the Company and one of its subsidiaries for bond proceeds and other funds, and issuance of medium-term notes (MTNs) with varying maturities issued by its subsidiary MBIA Global Funding, LLC (GFL). Each of these products is guaranteed by MBIA Corp. In addition, GFL would lend the proceeds of its GFL MTN issuances to MBIA Inc. (GFL Loans). The Company primarily purchased domestic securities and lent a portion of the proceeds from investment agreements and GFL MTNs to its subsidiary Euro Asset Acquisition Limited, which primarily purchased foreign assets as permitted under the Company’s investment guidelines. The Company’s conduit segment is principally operated through Meridian Funding Company, LLC (Meridian) and, formerly, Triple-A One Funding Corporation (Triple-A One). The conduits were used by banks and other financial institutions to raise funds for their customers in the capital markets. During 2012, Triple-A One was liquated. The conduits provided funding for multiple customers through special purpose vehicles that issued commercial paper and MTNs.
- [By Jake L’Ecuyer]
MBIA (NYSE: MBI) was also up, gaining 9.08 percent to $14.53 after the company reported upbeat Q4 earnings.
Equities Trading DOWN
Shares of McDermott International (NYSE: MDR) were down 9.49 percent to $7.34 after the company reported a Q4 loss of $1.37 per share on revenue of $517.3 million. It also withdrew its previous outlook. Capital One Financial downgraded the stock from Equalweight to Underweight and cut the price target from $8.00 to $6.00.
- [By Jake L’Ecuyer]
MBIA (NYSE: MBI) was also up, gaining 8.18 percent to $14.41 after the company reported upbeat Q4 earnings.
Equities Trading DOWN
Shares of McDermott International (NYSE: MDR) were down 6.97 percent to $7.55 after the company reported a Q4 loss of $1.37 per share on revenue of $517.3 million. It also withdrew its previous outlook. Capital One Financial downgraded the stock from Equalweight to Underweight and cut the price target from $8.00 to $6.00.
- [By MarketWatch]
MBIA Inc. (MBI) is expected to post a loss of 3 cents a share in the fourth quarter.
Top 5 Insurance Companies To Buy Right Now: The Travelers Companies Inc.(TRV)
The Travelers Companies, Inc., through its subsidiaries, provides various commercial and personal property and casualty insurance products and services to businesses, government units, associations, and individuals primarily in the United States. The company operates in three segments: Business Insurance; Financial, Professional, and International Insurance; and Personal Insurance. The Business Insurance segment offers property and casualty products and services, such as commercial multi-peril, property, general liability, commercial auto, and workers? compensation insurance. It operates in six groups: Select Accounts, which serves small businesses; Commercial Accounts that serves mid-sized businesses; National Accounts, which serves large companies; Industry-Focused Underwriting that serves targeted industries; Target Risk Underwriting, which serves commercial businesses requiring specialized product underwriting, claims handling, and risk management services; and Special ized Distribution that offers products to customers through licensed wholesale, general, and program agents. The Financial, Professional, and International Insurance segment provides surety and financial liability coverage, which uses a credit-based underwriting process; and property and casualty products primarily in the United States., the United Kingdom, Ireland, and Canada. The Personal Insurance segment offers property and casualty insurance covering personal risks, primarily automobile and homeowners insurance to individuals. It distributes its products through independent agents, sponsoring organizations, joint marketing arrangements with other insurers, and direct marketing. The company was founded in 1853 and is based in New York, New York.
- [By Dividends4Life]
Fair Value: In calculating fair value, I consider the NPV MMA Differential Fair Value along with these four calculations of fair value, see page 2 of the linked PDF for a detailed description: 1. Avg. High Yield Price 2. 20-Year DCF Price 3. Avg. P/E Price 4. Graham Number CINF is trading at a discount to only 3.) above. The stock is trading at a 36.8% premium to its calculated fair value of $34.96. CINF did not earn any Stars in this section. Dividend Analytical Data: In this section there are three possible Stars and three key metrics, see page 2 of the linked PDF for a detailed description: 1. Free Cash Flow Payout 2. Debt To Total Capital 3. Key Metrics 4. Dividend Growth Rate 5. Years of Div. Growth 6. Rolling 4-yr Div. > 15% CINF earned two Stars in this section for 1.) and 2.) above. A Star was earned since the Free Cash Flow payout ratio was less than 60% and there were no negative Free Cash Flows over the last 10 years. The stock earned a Star as a result of its most recent Debt to Total Capital being less than 45%. The company has paid a cash dividend to shareholders every year since 1954 and has increased its dividend payments for 54 consecutive years. Dividend Income vs. MMA: Why would you assume the equity risk and invest in a dividend stock if you could earn a better return in a much less risky money market account (MMA) or Treasury bond? This section compares the earning ability of this stock with a high yield MMA. Two items are considered in this section, see page 2 of the linked PDF for a detailed description: 1. NPV MMA Diff. 2. Years to > MMA The NPV MMA Diff. of the $62 is below the $500 target I look for in a stock that has increased dividends as long as CINF has. If CINF grows its dividend at 1.2% per year, it will take 5 years to equal a MMA yielding an estimated 20-year average rate of 3.68%. Memberships and Peers: CINF is a member of the S&P 500, a Dividend Aristocrat, a member of the Broad Dividend Achievers™ Index and a Divid
- [By Jon C. Ogg]
Travelers Companies Inc. (NYSE: TRV) is down by 8.2% year to date, and it is down 10% from its 52-week high and all-time high of $91.68. What is almost funny here is that most investors never even think about Travelers as a DJIA component. It is considered the forgotten DJIA stock, and its market cap is only $29 billion. Trading at $82.60, the consensus analyst target price of $89.80 implies upside of 8%. And then there is the 2.4% dividend to consider.
- [By Ben Levisohn]
Shares of American International Group have dropped 1.7% to $49.67 at 1:19 p.m. today, while American Financial Group (AFG) has, dropped 0.2% to $57.23, HCC Insurance (HCC) is little changed at $45.12, Travelers (TRV) has dipped 0.1% to $83.52 and Chubb (CB) is off 0.1% at $86.58.
- [By Ben Levisohn]
Shares of Johnson & Johnson have fallen 1.8% to $93.36 today, helping to contribute to a weaker Dow today. Other big Dow losers include Travelers (TRV), which is off 1.7% at $84.98 and Verizon Communications (VZ), which has dropped 1.6% to $47.56.
Top 5 Insurance Companies To Buy Right Now: Aviva PLC (AVV)
Aviva plc (Aviva) is an insurance group engaged in provision of products and services, such as long-term insurance and savings, fund management and general insurance. Aviva provides long-term insurance and savings, general and health insurance, and fund management products and services. Its business is managed on four geographic regions: United Kingdom, Europe, North America and Asia Pacific. The four regions, together with Aviva Investors, function as six operating segments. The UK region is split into the UK Life and UK General Insurance segments, which undertake long-term insurance and savings business and general insurance, respectively. In April 2013, it transferred its holding in Spanish joint venture Aseval to Bankia. In October 2013, Aviva sold Aviva USA Corporation to Athene Holding Ltd. Effective December 12, 2013, Redefine International Plc, a unit of Redefine Properties Ltd, acquired Weston Favell Shopping Centre from Aviva Commercial Finance Ltd, a unit of Aviva plc. Advisors’ Opinion:
- [By Namitha Jagadeesh]
Kabel Deutschland Holding AG rose to a record after getting an offer from Liberty Global Plc. Aveva Group Plc (AVV) jumped 5.4 percent as Citigroup Inc. upgraded the shares. Danske Bank A/S (DANSKE) dropped 6.1 percent after Denmark’s financial regulator ordered it to increase its risk-weighted assets. Royal Imtech NV fell to the lowest price since 2004 after posting a first-quarter loss on costs relating to a fraud investigation.
Top 5 Insurance Companies To Buy Right Now: Sun Life Financial Inc.(SLF)
Sun Life Financial Inc., together with its subsidiaries, provides various life and health insurance, savings, investment management, retirement, and pension products and services to individuals and corporate customers. It offers individual life insurance policies, including individual term life, universal life, critical illness, disability, accident, and accidental death and dismemberment insurance policies; and group life insurance policies. The company also provides individual health insurance, long-term care insurance, group health benefits, dental benefits, and group insurance; and various individual and group annuity, retirement, and investment income products and services, such as mutual and pooled funds, variable and fixed annuities, savings, retirement and pension plans, and education savings. In addition, it offers asset management services for corporate retirement plans, separate accounts, public or government funds, and insurance company assets to institutional clients; and advisory services to individual investors. Further, the company provides run-off reinsurance services. Sun Life Financial Inc. distributes its products through direct sales agents, independent and managing general agents, financial intermediaries, broker-dealers, banks, pension and benefit consultants, and other third-party marketing organizations. The company operates primarily in Bermuda, Canada, China, Hong Kong, India, Indonesia, Ireland, the Philippines, the United States, and the United Kingdom. Sun Life Financial Inc. was founded in 1999 and is based in Toronto, Canada.
- [By Monica Gerson]
Sun Life Financial (NYSE: SLF) shares gained 2.47% to create a new 52-week high of $34.80 on Q3 results. Sun Life reported its Q3 operating net income from continuing operations of $422 million.
- [By Amanda Alix]
Insurance companies have created an entire industry based upon risk, and except for AIG (NYSE: AIG ) during the financial crisis, it has worked out pretty well. So, it’s not a stretch to imagine a large life insurer like Canada’s Sun Life Financial (NYSE: SLF ) assuming the pension liability for the Canadian Wheat Board’s defined benefit plan in a recent $147 million deal, the first such accord in Canada’s history.