Post #20 by rnam on the Markel board

Stocks A to Z / Stocks M / Markel (MKL)

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Tom Gayner is deemphasizing book value as a measure of business value. Maybe a higher PB is merited as they make more acquisitions.

I also believe they are taking aggressive action to bolster loss reserves after detailed review of underwriting results. I expect there may be future reserve release from both better underwriting and more conservative reserving. Maybe a pleasant upside in the next few quarters.

The compound annual growth in book value per common share over the five-year period ended December 31, 2023 was 11%. We give consideration to the following information when assessing this measure:

Amortization expense - As we grow through acquisitions, our intangible assets grow. GAAP requires that we amortize a portion of these acquired intangible assets, which is a non-cash charge to net income. Amortization of acquired intangible assets for the five-year period ended December 31, 2023 totaled $827.9 million.

Unrealized gains and losses on fixed maturity securities - We invest in high credit quality, investment grade securities, with durations that are generally matched to the expected timing of claims-related payments. As such, unrealized gains and losses from our bond portfolio are generally expected to reverse as the securities mature. The fair value of our bond portfolio included cumulative pre-tax unrealized losses of $559.6 million as of December 31, 2023 compared to cumulative pre-tax unrealized gains of $92.4 million as of December 31, 2018.

Value of our businesses - Book value does not include changes in the fair value of our acquired businesses or equity method investments, other than decreases arising from an impairment. Acquired businesses include our Markel Ventures, insurance-linked securities and program services businesses..

https://seekingalpha.com/pr/19609043-markel-group-...

https://seekingalpha.com/article/4666795-markel-gr...

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