TWR - Tower Insurance.

[X-men]

So lucky did not get suck in with 2.5c dividend. Just like ZEL... dividend trap?

[winner69]

That’s one decent downgrade ....$30m down to $25m

And some hints of another downgrade before year ends in September

[X-men]

Bull..your star stock issued a downgrade ...what are your thoughts?

[winner69]

So all the good news that’s come out of Tower over the last six months or so is going to result in F21 profits being less (maybe quite a lot less) than F20

[JohnnyTheHorse]

A disappointing update for sure. But is it a minor setback in their turnaround or is it a large red flag?

Negatives:
- Large claims appear to be much higher than anticipated
- Increase in GWP has not translated through to profits
- Is investment income acceptable?

Positives:
- They have identified an issue and appear to be acting quickly to reprice risk. They should only get better over time with they electronic data platform they have been investing in
- Should see strong GWP growth going forward
- They are well placed to increase prices to manage claims inflation
- With rates increasing their investment income should increase

Overall even with this downgrade it'll be on a gross yield of ~8%. Looks like it'll take another 12 months to see whether this is fairly priced at current levels or whether this is a true turnaround stock. With the large management / insider holding I am picking the later but will be keeping a close eye on things...

[bull....]

Bull..your star stock issued a downgrade ...what are your thoughts?

a downgrade always disappointing.

but i guess its not entirely surprising , building costs have been going up quickly this year ( they note its higher than normal event of claims related to big house claims so you would expect a decline to more normal levels in the future)
it wont be just tower but will be affecting all insurers and not only insurers but also numerous other industries eg retirement stocks

luckily for tower they will be able to mitigate the cost increases of building related claims by making us pay more for insurance as i imagine all insurance companies will do. so i dont see it as an issue in the future if correctly addressed.

if you believe rates have bottomed recently worldwide and we are in a environment of rates normalising up now then there investment income should have bottomed recently as well.

all insurance companies always report adverse events every year so its never a surprise something happens at some stage to report , just the normal course of events. anyway looking forward to my dividend

[winner69]

Is this little bit a signal of a further downgrade ....or a bit of let’s hope it’s all OK

Separately, following a review of the FY21 reinsurance programme, there could potentially be an increase in the full year reinsurance costs for FY21. It is anticipated the additional costs, if any, would be within the tolerances of this guidance.

[Balance]

Is this little bit a signal of a further downgrade ....or a bit of let’s hope it’s all OK

Separately, following a review of the FY21 reinsurance programme, there could potentially be an increase in the full year reinsurance costs for FY21. It is anticipated the additional costs, if any, would be within the tolerances of this guidance.

You know the drill, W69 - downgrades come in threes.

[winner69]

You know the drill, W69 - downgrades come in threes.

Tower seem to have three a year ...most years

And then seduce punters with the promise of a divie.

[bull....]

balance and winner ..... downgrade lol. stirring the pot