TWGP ==> The World Series Winner

[mrmarket]

When I was a junior in college, I used to work the door at Sigma Nu fraternity parties. Now working the door had its drawbacks. You don’t get to dance and party with all of your friends, and if there ever was a fight, you had to throw someone out of the fraternity house (recommended method is grabbing someone from behind by the belt with one hand, and the collar of their shirt with the other and doing a 1,2.3 heave-ho to see how far they can fly). The upside to working the door was that, even though we weren’t supposed to, we’d charge a cover at the door. It was variable pricing depending on how much of a loser the person was who wanted to come to the party (of course women were free). Usually by the end of my door shift, I had a nice little wad of cash in my pocket which was to be used for emergency repairs or some other catastrophic event that may have resulted from the party. If nothing bad happened at the party, then we would make a Roy’s run and eat roast beef and chicken.

Now I don’t mean to oversimplify things, but an insurance company works much the same way.

Throughout 2005 (before Katrina), the insurance industry was showing marked improvement in claim trends. After Katrina, investors bid up stock prices in insurance companies with the expectation of higher insurance premiums carrying the day. These investors were rewarded as the property-casualty industry produced double digit net income growth. Of course all of this was precursor padding for the next catastrophe….which never came. “Look Ma! No hurricanes!”

2005 was dominated by record losses from hurricanes Katrina, Rita, and Wilma. Nevertheless, the industry showed resilience. Underwriting discipline and the benefits of reinsurance preserved the industry’s surplus and profitability. Going forward, the realization of higher catastrophe exposures increased capital requirements and property premium rates. However, if there are no catastrophies, what do the insurance companies do with all of that money? Keg Party?

Insurers and reinsurers worldwide bore a record USD 83 billion of total insured property catastrophic losses, with Hurricane Katrina alone estimated at USD 45 billion. US P&C insurers are expected to pay USD 58 billion losses for last year’s natural catastrophes

The industry’s ROE for 2005 was 11.6 percent; for 2006, the ROE is likely to be around 11 percent. In the aftermath of the hurricane season, the pace of premium growth is likely to pick up slightly as commercial property prices firm.

“Look Ma! No hurricanes!”

Ok..now what are the insurance companies going to do with all of this money? Invest it? Oh by the way, the market is at an all time high. Maybe the money that was invested got big and fat like the wad of cash in my pocket from working the door. Hmmm..do we detect a trend here? Roy’s Run!
Today I bought TWGP at $35.38/share. I will sell it in 4 – 6 weeks at $41.05/share. Here is why I like TWGP.
TWGP stock is up over 100% in the last 12 months yet its PE is only 23 (vs. a market PE of 21). It’s forward PE is even better, at a mere 14. Look at this beautiful chart:

http://chart.finance.yahoo.com/c/1y/t/twgp

Through its subsidiaries Tower Insurance Company of New York, Tower National Insurance Company and Tower Risk Management Corporation, Tower Group offers a broad range of specialized property and casualty insurance products and services to small to mid-sized businesses such as retail and wholesale stores, grocery stores, restaurants, artisan contractors and residential buildings. Personal lines products currently focus on modestly valued homes and dwellings. Both of the company's two subsidiaries are rated A-(Excellent) by A.M. Best Company.

So is there anything more boring than insurance? Probably not..but what makes TWGP so interesting? Ask Ace Frehley:

http://www.guitareelectrique.com/images/epiphone_ace_frehley.jpg

Many years since I was here, on the street I was passin my time away
To the left and to the right, buildings towering to the sky
Its outta sight in the dead of night
Here I am, and in this city, with a fistful of dollars
And baby, youd better believe

Chorus:
Im back, back in the new york groove
Im back, back in the new york groove
Im back, back in the new york groove
Back in the new york groove, in the new york groove

In the back of my cadillac
A wicked lady, sittin by my side, sayin where are we?
Stop at third and forty-three, exit to the night
Its gonna be ecstacy, this place was meant for me

Feels so good tonight, who cares about tomorrow
So baby, youd better believe

Chorus

Im back, back in the new york groove

When it comes to selling insurance to the New York City’s neighborhood small storefront businesses, many insurance firms don’t see the upside in the aggravation. However this is Tower Group’s bread and butter.
Tower is just the right size to take on this business. The big guys don’t want to deal with the headache and the little guys aren’t well enough capitalized to diversify the inherent risk or have the basic infrastructure to operate efficiently. Tower's average commercial premium policy is about $2,000, There's not much competition for these small policies because they are difficult to process cost effectively. This is consistent with their hedgehog strategy: Target select market segments that they believe are underserved, and therefore provide them with the best opportunity to obtain favorable policy terms, conditions and pricing.

With the capital from its recent IPO, Tower has been able to write more of its own insurance business rather than farm it out to reinsurers and other carriers. This lets the company fund more of the risk itself and keep premium fees in-house. Tower is already ramping up its city expertise to spread current and future product lines to urban areas in New Jersey. They also have plans for Massachusetts and Pennsylvania (two other states I have lived in). Additional available capital generates more investment income as well (did I already mention that the Dow is at an all time high?)
Tower favors low risk and low severity policies which makes them a safe actuarial bet, despite it not being as big as the behemoths Prudential and AllState. They generally target customers that have a reduced potential for loss severity and that are not normally exposed to long-tailed, complex or contingent risks, such as products liability, asbestos or environmental claims.
The underwriting strategy for controlling their loss ratio is to seek diversification in their products and an appropriate business mix for any given year, emphasizing profitable lines of business and minimizing unprofitable lines. Tower monitors the actual loss ratio throughout the year on a regular basis. If any line of business fails to meet its target loss ratio, a cross functional team comprised of personnel from all departments meet to develop a corrective action plan.

For over a decade, Tower Group Companies has been consistently meeting the insurance needs of individuals and businesses. Recently, TWGP was recognized as “Company of the Year” by its producers for commitment and service to the tri-state region. Tower Group Companies develops its products in response to the needs of customers and changing market conditions. Their business development team works closely with producers to quickly define and deliver new and enhanced products to meet the changing needs of customers.

Great company right…does it make money? Whoooooo! Does it ever. It has grown its revenues and earnings successively for each of the last 5 years.
In 2005, following the successful IPO on the NASDQ in 2004, the company increased Total Premiums (gross premiums written and services premiums produced) by 45% to $335 million. In August of this year Tower Group reported a 158% increase in its second quarter 2006 net income, $0.61 per diluted share as compared to $0.42 per diluted share for the first six months of 2005.

Tower Group's revenue growth (63.96 percent) is way above its earnings growth (36.68 percent). In testing its earnings stability, one need only look at the fact that TWGP has a positive current quarterly EPS, a positive EPS for the quarter one year ago, and a positive growth rate for the current quarter's earnings compared to the same quarter a year ago and the long term EPS growth rate.

In addition, the EPS growth for the current quarter is greater than the prior three quarters, EPS growth for the current quarter is greater than the historical growth rate, and earnings have increased each year for the last five years. Unlike larger insurers, Tower doesn't build scale in a segment unless it can be assured it will make positive underwriting margins for the next three or four years. This “insures” continued earnings growth given stable macroeconomic conditions. Tower Group exceeded their net income guidance each quarter in 2005 to achieve an ROE of 18.4%.
When TWGP ended 2005, they had a 29% increase in the number of policies written. On top of the number of policies, the rates increased over 6%. Let’s do the math..increased volume times increased margins = increased earnings earnings earnings. Combine that with the fact that investment allocations in 2005 were increased in equities and higher yielding fixed income assets.

ANAL-ysts have “insured” that TWGP will earn $1.62/share this year on $317 MM of revenue. For 2007, they project earnings of $2.42/share on $398 MM of revenue. Now the good news is that even the ANAL-ysts project growth in Tower’s business. Heck, if you take the ANAL-ysts $2.42 projection for 2007 and multiply it by today’s PE of 23, you get $55/share. Pretty darned good. I’ll go one better. Based on the fact that TWGP’s earnings will be positively influenced by investment income and inflated premiums relative to losses, $$$MR. MARKET$$$ sees next quarter’s earnings coming in at $0.71/share and the following quarter at $0.74/share which makes 2006 earnings $2.38/share. So I think that TWGP will hit ANAL-ysts projected earnings, only a lot sooner. This means I’ll see the stock price get to my desired target in the next month or two.

What’s even cooler is that their CEO is a relative of Bruce Lee. I don’t want to get him mad at me but her’e what Michael Lee said about his company:

“Our second quarter results established new records for both revenue and earnings as reflected by our increasing return on equity. During the quarter, we achieved strong growth in gross and net premiums earned and investment income while continuing to maintain a disciplined underwriting approach. In addition, we eliminated our exposure to reinsurance recoverables from an unrated reinsurer at favorable terms to further strengthen our balance sheet. This was also our first quarter with CastlePoint Re as our quota share reinsurer, and this relationship further strengthened our business model by supporting our growth and improving our return on average equity to the upper end of our target range for the year.”

This company is on fire! There is no need to extinguish either because profits dead ahead are insured.

Did you like this write-up? Email me back and let me know. If you really liked it, send it on to 3 friends. The WORLD needs to heed the calling of $$$MR. MARKET$$$.

I am HUGE!!

$$$MR. MARKET$$$

http://www.mrmarketishuge.com

[billyjoe]

Mr. Market,
This is the first time we've ever picked the same one from the final 5. Is that possible ? Wait a minute , I also loved BEL , but we won't talk about that one. I'm in TWGP at 35.44. An insurance company helps me diversify.

---------------billyjoe

[jiesen]

Awesome pick, and a great writeup, too, $$MM! I'm in with you at 35.4.

[Websman]

Excellent pick Huge One!!! TWGP ranks high in my exclusive VTP ratings system.

[mrmarket]

check out the slides from their presentation at this recent investor conference....this stock is a steal:

http://customer.talkpoint.com/KEEF001/090606a_pg/agenda.asp?day=Alphabetical

[peanuts]

Today I bought TWGP at $35.38/share. I will sell it in 4 – 6 weeks at $41.05/share. Here is why I like TWGP.


Ernie,

I haven't yet received the email, but I did buy the stock. Nice pick, and nice write-up! I'm up over 1.5% already.

[billyjoe]

Mr Market,
Don't know if you ever used Growth Stock Analytics. Out of 919 stocks they rate that I can access , TWGP and MTEX are tied for 2nd with "A" ratings. It is almost impossible to get an "A" from these guys.

-------------billyjoe

[mrmarket]

Mr Market,
Don't know if you ever used Growth Stock Analytics. Out of 919 stocks they rate that I can access , TWGP and MTEX are tied for 2nd with "A" ratings. It is almost impossible to get an "A" from these guys.

-------------billyjoe

never heard of it

[bknight]

For once I already have this one, from a bit higher than you bought it though.

[JohnHenry]

For once I already have this one, from a bit higher than you bought it though.

Hi BK

I tired to email you but you don't accept emails...what kind of an engineer are you?

[alice4321us]

Why is this tanking?

[mrmarket]

Why is this tanking?

It's either the cowards or the smarties getting out ahead of tomorrow's earnings and running with their profits. I guess we'll see who is who in a day or so!

[New-born baby]

It's either the cowards or the smarties getting out ahead of tomorrow's earnings and running with their profits. I guess we'll see who is who in a day or so!

Just guessing for now, of course, but the guess is smarties. Reason: somebody with a lot of shares is selling those shares. Huge topping volume a few days ago. If TWGP doesn't turn it around tomorrow, it may be a while before it exceeds the recent highs.

TWGP has good support at $32, $31, and $30. And it has an option chain. I think these will provide excellent opportunities to enter a position.
http://img144.imageshack.us/img144/9710/chart1hm3.gif (http://imageshack.us)

[billyjoe]

New-born,
I'm not saying the earnings report will be bad , but worst case scenario, if earnings are very bad, isn't support at 32, 31, 30 insignificant?

----------billyjoe

[minstrlman]

take a look here http://stockcharts.com/h-sc/ui?s=TWGP&p=W&b=5&g=0&id=p84737575147 and tell me where you'd like to buy this puppy. 30ish looks pretty good to me.

[IIC]

take a look here http://stockcharts.com/h-sc/ui?s=TWGP&p=W&b=5&g=0&id=p84737575147 and tell me where you'd like to buy this puppy. 30ish looks pretty good to me.

Hey...Are you the same Minstrlman I know? If so, WELCOME...If not...WELCOME...Best, Doug(IIC)

[minstrlman]

Hey...Are you the same Minstrlman I know? If so, WELCOME...If not...WELCOME...Best, Doug(IIC)

I am the same. In fact you provided the link that led me to this site and this group. Thanks!

MM

[IIC]

I am the same. In fact you provided the link that led me to this site and this group. Thanks!

MM


Oh yeah...Glad to see you made it over here...Best, Doug(IIC)

[New-born baby]

take a look here http://stockcharts.com/h-sc/ui?s=TWGP&p=W&b=5&g=0&id=p84737575147 and tell me where you'd like to buy this puppy. 30ish looks pretty good to me.

Yes indeed, Minstrlman! Welcome to MM forum. And thanks for a beautiful chart. Yup, I like it at $30 very much. Patience, people. It will get there, probably tomorrow.

[New-born baby]

Yes indeed, Minstrlman! Welcome to MM forum. And thanks for a beautiful chart. Yup, I like it at $30 very much. Patience, people. It will get there, probably tomorrow.


Well, it got there. And it was the smarties.

[lemonjello]

As a junior chartman, it doesn't look like either TWGP or MTEX are thru falling.

Data "dump" indeed.

[ringo69]

I got in at 30.10:eek:

[casinoboy3]

Reached 15% today, in only 8 days!!! Oh wait, wrong direction, AGAIN.

[New-born baby]

As a junior chartman, it doesn't look like either TWGP or MTEX are thru falling.

Data "dump" indeed.

Yup. Dow Theory now says TWGP is going to dump all the way down to $25-or lower. HUGE earnings disappointment, I take it.

[New-born baby]

I got in at 30.10:eek:

Ringo,
I just want to suggest one thing for you: buy a $30 NOV put for $1. TWGP will bounce, but not for awhile now. AXR took a couple of months, I think, to rebound fully. I thing TWGP may possibly be in that category also.

[bsideindy]

From Yahoo: The third-quarter profit surged 48 percent.

How is this a huge earnings disappointment? Please explain. I'm pretty new to this, but that seems like good news to me.

[spikefader]

From Yahoo: The third-quarter profit surged 48 percent.

How is this a huge earnings disappointment? Please explain. I'm pretty new to this, but that seems like good news to me.Forget news. Buy support and sell resistance. Apply good risk reward and money management and let the Street do what it will, for much of reaction to news makes little sense. Make the numbers make sense and you'll be grinning.

http://img527.imageshack.us/img527/1292/twgpyd1.gif (http://imageshack.us)

[Runner]

I think the TGT of this triangle has been hit.
http://img234.imageshack.us/img234/4158/twgpbm4.png (http://imageshack.us)

[Runner]

Hindsight is 20/20 as well. Hope this guy bounces back.

[mrmarket]

Don't cry..they announced that they are paying a dividend...whoo hoo!

[New-born baby]

Don't cry..they announced that they are paying a dividend...whoo hoo!

AXR came back, in the most unlikely of sectors, too.

[billyjoe]

From Yahoo: The third-quarter profit surged 48 percent.

How is this a huge earnings disappointment? Please explain. I'm pretty new to this, but that seems like good news to me.


bside,
Although they matched analysts earnings, they were a couple million off on revenue and they see earnings next quarter that might miss analysts numbers by 1-3 cents. That miss of 2 million cost them 60 million in reduced market capitailzation. Crazy , ain't it ?

-------------billyjoe

[IIC]

From Yahoo: The third-quarter profit surged 48 percent.

How is this a huge earnings disappointment? Please explain. I'm pretty new to this, but that seems like good news to me.

They only met estimates...that doesn't seem to help a stock...They need to blow estimates out. I don't know if the had a conference call...that also could have some bearing on it....there are jillions of possible reasons....Did they issue guidance?...If they did and they didn't raise it that normally has a negative effect...at least short term.

Best, Doug(IIC)

[IIC]

I didn't see Billy's post before I posted mine...What Billy posted would certainly explain it...Doug(IIC)

[Runner]

The Klinger Oscillator is a volume based oscillator created by Stephen Klinger that measures short-term and long-term trends in money flow into and out of a security.

“The Klinger Oscillator also uses divergence to identify when price and volume are not confirming the direction of the move. It is considered to be a bullish sign when the value of the indicator is heading upward while the price of the security continues to fall. Traders will use other tools such as trendlines, moving averages and other indicators to confirm the reversal.”

“The most important signal occurs when the KO diverges with the underlying price action, especially on new highs or new lows in overbought/oversold territory. For example, when a stock makes a new high or low for a cycle and the KO fails to confirm this, the trend may be losing momentum and nearing completion.”

I’m not a indicator freak but this KO indicator appears to have shown the divergence in price action. Notice this underlining action was not revealed in the volume bars..uuummm…
http://img95.imageshack.us/img95/3906/twgp1me9.th.png (http://img95.imageshack.us/my.php?image=twgp1me9.png)

[lemonjello]

Runner,

Nice chart. What software are you using for the Klinger O?

The Klinger Oscillator is a volume based oscillator created by Stephen Klinger that measures short-term and long-term trends in money flow into and out of a security.

“The Klinger Oscillator also uses divergence to identify when price and volume are not confirming the direction of the move. It is considered to be a bullish sign when the value of the indicator is heading upward while the price of the security continues to fall. Traders will use other tools such as trendlines, moving averages and other indicators to confirm the reversal.”

“The most important signal occurs when the KO diverges with the underlying price action, especially on new highs or new lows in overbought/oversold territory. For example, when a stock makes a new high or low for a cycle and the KO fails to confirm this, the trend may be losing momentum and nearing completion.”

I’m not a indicator freak but this KO indicator appears to have shown the divergence in price action. Notice this underlining action was not revealed in the volume bars..uuummm…
http://img95.imageshack.us/img95/3906/twgp1me9.th.png (http://img95.imageshack.us/my.php?image=twgp1me9.png)

[mrmarket]

They only met estimates...that doesn't seem to help a stock...They need to blow estimates out. I don't know if the had a conference call...that also could have some bearing on it....there are jillions of possible reasons....Did they issue guidance?...If they did and they didn't raise it that normally has a negative effect...at least short term.

Best, Doug(IIC)


PE is still very reasonable, even with lower than projected earnings. I still like this company very much.

[skiracer]

PE is still very reasonable, even with lower than projected earnings. I still like this company very much.

I should hope so you still have your money in it.

[IIC]

bsideindy: Here is another example of how guidance affects the price...WFMI is dn 20% today:

Whole Foods 4Q Net Rises; Stock Slumps On Outlook
.


Whole Foods Market Inc. (WFMI) late Thursday posted higher earnings and revenue in its fiscal fourth quarter, but its shares sagged 14% after hours on a softer growth forecast for fiscal 2007.
Shares of the Austin, Texas, company, which owns and operates the No. 1 U.S. chain of natural foods supermarkets, lost $8.45 to change hands at $51.67 in late trading.
Whole Foods after Thursday's closing bell said its fiscal fourth-quarter net income rose to $39.8 million, or 28 cents a share, from $9.1 million, or 6 cents a share, in the year-ago quarter. Whole Foods' fourth quarter ended Sept. 24.
Excluding certain one-time items, including stock option expenses, earnings came in at 29 cents a share versus 23 cents in the same quarter last year.
Revenue rose to $1.29 billion from $1.12 billion, while same-store sales, or sales at stores open at least a year, rose 8.6% versus a 13.4% increase the year before.
Analysts, on average, expected Whole Foods to post revenue of $1.32 billion, according to Thomson First Call.
Whole Foods said it has increased its quarterly dividend by 20%, to 18 cents from 15 cents a share. The new dividend is payable to shareholders as of Jan. 12.
In a separate announcement, the company said Chairman, Chief Executive and co-founder John Mackey will cut his salary to $1 as of Jan. 1, and will forgo any future stock option awards.
But citing recent results, current sales trends and the "continuing difficult comparison, particularly in the first half of the year," the company said it now expects same-store sales growth of 6% to 8% for fiscal 2007, compared with an 11% rise in fiscal 2006.
Total sales, on a 52-week comparable basis, are now seen coming in 13% to 17% higher than 2006, versus a prior forecast for a 15% to 20% rise. Fiscal 2007 will be a 53-week year, the company said.
As well, materially higher preopening and relocation costs will significantly affect 2007 per-share earnings growth, Whole Foods said.
The popularity of organic and prepared foods and the willingness of shoppers to spend more on high-end merchandise have helped to spur growth at the food retail chain. Analysts have cautioned that increased competition, tough comparisons and a consumer-spending slowdown could hurt Whole Foods.
Whole Foods stock has underperformed its rivals, slipping 23% in the first nine months of the year. Smaller competitor Wild Oats Markets Inc.'s (OATS) shares are up 34% in the same period.

[peanuts]

Well,

TWGP intially made my earnings screen. We'll see how it stacks up against the rest of the bunch. Look for the final spreadsheet this weekend: LINK (http://www.mrmarketishuge.com/showpost.php?p=60590&postcount=4)

[ringo69]

Ringo,
I just want to suggest one thing for you: buy a $30 NOV put for $1. TWGP will bounce, but not for awhile now. AXR took a couple of months, I think, to rebound fully. I thing TWGP may possibly be in that category also.

Thanks, I have been considering downside protection with puts on MM picks. My own conspiracy theory - it almost seems like there is someone or several people trading against MM picks in the short term. :confused:

[New-born baby]

Thanks, I have been considering downside protection with puts on MM picks. My own conspiracy theory - it almost seems like there is someone or several people trading against MM picks in the short term. :confused:

I don't buy into the conspiracy theory. MM is huge, but the market is huger. :D

What I believe is happening is MM is picking momo stocks in a market that is flat. Good stocks will rebound. Look at AXR. Tremendous play. He should have shorted it for 30%, and then bought it for another 100%. When he picked it, I wrote on Hot Pick of the Day "don't." It had an ugly chart. But it rebounded.

TWGP will probably do the same. In fact, as long as the CEO isn't a crook, all the MM picks rebound.

[Websman]

I don't buy into the conspiracy theory. MM is huge, but the market is huger. :D



Blasphemy!!!

The Vulcans worship the ground that Mr. Market walks on! Mr Market makes the market his girlfriend!!!

[lemonjello]

MFLX rebound? It's been six months now.

I don't buy into the conspiracy theory. MM is huge, but the market is huger. :D

What I believe is happening is MM is picking momo stocks in a market that is flat. Good stocks will rebound. Look at AXR. Tremendous play. He should have shorted it for 30%, and then bought it for another 100%. When he picked it, I wrote on Hot Pick of the Day "don't." It had an ugly chart. But it rebounded.

TWGP will probably do the same. In fact, as long as the CEO isn't a crook, all the MM picks rebound.

[New-born baby]

MFLX rebound? It's been six months now.

I have seen MM hold a stock 2 years until it turned into a winnah. MFLX may follow suit.

[New-born baby]

Well, here's my view of TWGP for now. Looking like she's going to
test $27.50-$25, imho. Ringo, I'd be buying a put IF TWGP falls below $30, or more likely, look to take profits now.

http://img143.imageshack.us/img143/8558/chart1rn2.gif (http://imageshack.us)

[IIC]

Thanks, I have been considering downside protection with puts on MM picks. My own conspiracy theory - it almost seems like there is someone or several people trading against MM picks in the short term. :confused:


I rather doubt that there is any conspiracy...But if there was then I'd say Mr. M made it to the top...I'd love it if there was a conspiracy against the IIC 100...That'd be SUPER...I can hear SKI and Peanuts chanting now..."Short The IIC 100...Short The IIC 100...Short The IIC 100"...

[ringo69]

I rather doubt that there is any conspiracy...But if there was then I'd say Mr. M made it to the top...I'd love it if there was a conspiracy against the IIC 100...That'd be SUPER...I can hear SKI and Peanuts chanting now..."Short The IIC 100...Short The IIC 100...Short The IIC 100"...

What the ticker symbol for IIC 100? :D :cool:

[IIC]

What the ticker symbol for IIC 100? :D :cool:


It changes everyday...Today it is MIKR...lol

[ringo69]

I don't buy into the conspiracy theory. MM is huge, but the market is huger. :D

What I believe is happening is MM is picking momo stocks in a market that is flat. Good stocks will rebound. Look at AXR. Tremendous play. He should have shorted it for 30%, and then bought it for another 100%. When he picked it, I wrote on Hot Pick of the Day "don't." It had an ugly chart. But it rebounded.

TWGP will probably do the same. In fact, as long as the CEO isn't a crook, all the MM picks rebound.


NBB, Like I said its my own theory. I do see your point of the flat market affecting MM picks . . . but I know of two traders that specifically buy "trading systems" just to trade against them, and they are doing very well. The best example I can give to support my conspiracy theory is the Turtles. Their system worked very well until the method was released/exposed to the public. Now the turtles have people who trade against the turtle system, book have written, seminars on it, and so on. Thus, turtle soup. Yum Yum. This does not say the turtles system does not work anymore, but it is not as efficient as it once was when only a few people knew it. ;)

[New-born baby]

NBB, Like I said its my own theory. I do see your point of the flat market affecting MM picks . . . but I know of two traders that specifically buy "trading systems" just to trade against them, and they are doing very well. The best example I can give to support my conspiracy theory is the Turtles. Their system worked very well until the method was released/exposed to the public. Now the turtles have people who trade against the turtle system, book have written, seminars on it, and so on. Thus, turtle soup. Yum Yum. This does not say the turtles system does not work anymore, but it is not as efficient as it once was when only a few people knew it. ;)

Okay. That is information I didn't have before. Turtle soup, eh? You could very well be correct. Thanks for the info.

[jiesen]

http://biz.yahoo.com/bw/061114/20061114005756.html?.v=1

Tower Group, Inc. Will Acquire Preserver Group, Inc.

Tuesday November 14, 8:45 am ET NEW YORK--(BUSINESS WIRE)--Tower Group, Inc. (NASDAQ: TWGP (http://finance.yahoo.com/q?s=twgp&d=t) - News (http://finance.yahoo.com/q/h?s=twgp)) announced today that it has reached an agreement to acquire the outstanding stock of Preserver Group, Inc. for cash consideration of approximately $68 million, a portion of which will be allocated to repay all shareholder owned debt. In addition, $12 million of trust preferred securities will be assumed. The transaction is subject to regulatory approval. Transaction Summary
Preserver is a privately held company that specializes in small commercial and personal lines insurance in the Northeast. The company offers similar products and has a similar risk appetite as Tower's.
The acquisition will give Tower access to up to 300 retail agencies working with Preserver that have little or no overlap with Tower's existing distribution.
The transaction enhances Tower's Northeast expansion plans with additional premium volume and scale. Preserver writes business in New Jersey, Maine, New York, New Hampshire, Massachusetts, Vermont, Rhode Island and Pennsylvania.
It is expected that Preserver will enter into a loss portfolio transfer agreement to reinsure its historical loss reserves with CastlePoint Re. CastlePoint Re is a reinsurance subsidiary of CastlePoint Holdings, Ltd., the formation of which was sponsored by Tower earlier this year.Michael Lee, President and Chief Executive Officer of Tower Group, Inc., commented, "We are pleased to announce this transaction which represents an extremely good fit for our regional strategy in the Northeast. Preserver has a similar underwriting appetite, and we plan to work closely with the Preserver management team and employees to deliver higher value to our combined agents and customers. To ensure continuity and further strengthen our management team, Pat Haveron of Preserver will be joining us as Senior Vice President and Chief Operating Officer. We anticipate expense ratio improvements from our larger scale and infrastructure. Consistent with our acquisition strategy, the transaction is expected to be modestly accretive to earnings per share in its first year."

Patrick J. Haveron, President and Chief Executive Officer of Preserver Group, Inc. stated, "We look forward to contributing to the level of success that Tower has achieved. Both Tower and Preserver have a successful track record in these types of transactions, and we believe the combined operation will be well positioned to take advantage of opportunities in the Northeast. Preserver producers will benefit from an enhanced platform and grow with companies that are focused on customer service. We also believe this transaction will present significant opportunities for our employees and I look forward to joining Tower's successful leadership team."

Tower also announced that CastlePoint Re has agreed to invest $40 million in convertible perpetual preferred stock of Tower Group, Inc.

Guidance for 2007:
We believe Tower Group, Inc.'s acquisition of Preserver Group, Inc. will be modestly accretive to earnings in 2007 and more significantly in future years. We anticipate net income in 2007 to be in a range between $54.6 million and $56.8 million and diluted earnings per share to be between $2.40 and $2.50 per diluted share.

Conference Call

Tower will host a conference call to discuss the transaction on Thursday, November 16, 2006 at 10:00 A.M. (Eastern Time). The domestic number is (800) 291-9234, international number is (617) 614-3923. All callers should enter the passcode 69116976 for the call.
This conference call also will be broadcast live over the Internet. To access a listen-only webcast over the Internet, please visit the Investor Information section of Tower Group, Inc.'s website,
(http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=179906&eventID=1418536)
(Due to its length, this URL may need to be copied/pasted into your Internet browser's address field. Remove the extra space if one exists.)
Please access the website at least 15 minutes prior to the call to register and to download any necessary audio software. This is a live event only, and there will be no replay.

About Tower Group, Inc.

Tower Group, Inc., headquartered in New York City, offers property and casualty insurance products and services through its insurance company and insurance service subsidiaries. Its two insurance company subsidiaries are Tower Insurance Company of New York which is rated A- (Excellent) by A.M. Best Company and offers commercial insurance products to small to medium-size businesses and personal insurance products to individuals and Tower National Insurance Company which is also rated A- (Excellent) by A.M. Best Company. Its insurance services subsidiary, Tower Risk Management, acts as a managing general agency, adjusts claims and negotiates reinsurance terms on behalf of other insurance companies.
Cautionary Note Regarding Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. This release or any other written or oral statements made by or on behalf of the Company may include forward-looking statements that reflect the Company's current views with respect to future events and financial performance. All statements other than statements of historical fact included in this release are forward-looking statements. Forward-looking statements can generally be identified by the use of forward-looking terminology such as "may," "will," "plan," "expect," "intend," "estimate," "anticipate," "believe" or "continue" or their negative or variations or similar terminology. All forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. We believe that these factors include but are not limited to ineffectiveness or obsolescence of our business strategy due to changes in current or future market conditions; increased competition on the basis of pricing, capacity, coverage terms or other factors; greater frequency or severity of claims and loss activity, including as a result of natural or man-made catastrophic events, than our underwriting, reserving or investment practices anticipate based on historical experience or industry data; the effects of acts of terrorism or war; developments in the world's financial and capital markets that adversely affect the performance of our investments; changes in regulations or laws applicable to us, our subsidiaries, brokers or customers; changes in the level of demand for our insurance and reinsurance products and services, including new products and services; changes in the availability, cost or quality of reinsurance and failure of our reinsurers to pay claims timely or at all; loss of the services of any of our executive officers or other key personnel; the effects of mergers, acquisitions and divestitures; changes in rating agency policies or practices; changes in legal theories of liability under our insurance policies; changes in accounting policies or practices; and changes in general economic conditions, including inflation and other factors. Forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

Regarding the transactions described above, we would add the following cautions to those included in our filings with the SEC:
the transaction may not occur as expected or it may take longer to accomplish than we expect;
governmental approvals of the transaction may not be obtained, or adverse regulatory conditions may be imposed in connection with governmental approvals of the transaction;
we may not be as successful as we anticipate in managing the integration of Preserver, including with respect to realizing cost savings and distributing our products through Preserver's agencies;
the sale is subject to the satisfaction or waiver of certain conditions which are beyond our control; and
adverse conditions in the capital markets may make it more expensive for us or limit our ability to raise capital to support this acquisition and other growth opportunities.For more information visit Tower's website at http://www.twrgrp.com/.

[mrmarket]

nice little pop today, eh?

[jiesen]

quite nice! Of course most stocks got a nice little lift today...

[peanuts]

The day is today, the time is now. http://www.mrmarketishuge.com/images/icons/icon14.gif

Great analysis, NBB. I always knew you were a genius! :)

Well, here's my view of TWGP for now. Looking like she's going to
test $27.50-$25, imho.
http://img143.imageshack.us/img143/8558/chart1rn2.gif (http://imageshack.us)

[riverbabe]

The day is today, the time is now.

Great analysis, NBB. I always knew you were a genius! :)

Yes, what a true genius! But why today? Why not tomorrow? It hasn't actually hit 27.50 yet.
I don't see any reason why it shouldn't keep going down. Just interested. I see a little buying propping it up right now. Is that YOU peanuts??? LOL River

http://stockcharts.com/h-sc/ui?s=TWGP&p=D&b=5&g=0&id=p15012825181

[peanuts]

Yes, what a true genius! But why today? Why not tomorrow? It hasn't actually hit 27.50 yet.
I don't see any reason why it shouldn't keep going down. Just interested. I see a little buying propping it up right now. Is that YOU peanuts??? LOL River

http://stockcharts.com/h-sc/ui?s=TWGP&p=D&b=5&g=0&id=p15012825181

hehehehe :D :D :cramersmiley: :D :D

no, no, no, I'm just little peanuts. Remember that. Who knows, maybe $27.50 will hit? You playin ball?

[riverbabe]

hehehehe :D :D :cramersmiley: :D :D

no, no, no, I'm just little peanuts. Remember that. Who knows, maybe $27.50 will hit? You playin ball?

Probably not this minute. I really lightened up yesterday (and a good thing I did!). I see the market having lots of sharp down days for the next few weeks. I'm in capital protection mode. I need to do some DD on this stock before making a commitment. But I'm-a watchin'. Does MM still own this?

[New-born baby]

Probably not this minute. I really lightened up yesterday (and a good thing I did!). I see the market having lots of sharp down days for the next few weeks. I'm in capital protection mode. I need to do some DD on this stock before making a commitment. But I'm-a watchin'. Does MM still own this?
Of course :D He always owns until he gets his 15%.
I would not suggest buying here. It looks like it is going lower.

[riverbabe]

Of course :D He always owns until he gets his 15%.
I would not suggest buying here. It looks like it is going lower.

I agree, MrGenius. You are HUGE!

[peanuts]

Yes, what a true genius! But why today? Why not tomorrow? It hasn't actually hit 27.50 yet.
I don't see any reason why it shouldn't keep going down. Just interested. I see a little buying propping it up right now. Is that YOU peanuts??? LOL River

http://stockcharts.com/h-sc/ui?s=TWGP&p=D&b=5&g=0&id=p15012825181

This morning's low was $27.56.

I don't think it will get any cheaper, but it this a tough game... catching knives without getting cut :o

[peanuts]

This morning's low was $27.56.

I don't think it will get any cheaper, but it this a tough game... catching knives without getting cut :o

weeeeeeeeeeeeeeeeeeee

NBB, you rock!!!! :)

[New-born baby]

weeeeeeeeeeeeeeeeeeee

NBB, you rock!!!! :)

You rock, Peanuts!

[peanuts]

weeeeeeeeeeeeeeeeeeee

NBB, you rock!!!! :)

OK,

I've had my fun. Sold them at $29.80... that's a $1.84 / share gain, or 6.58% in 2 friggin days, folks!!!

Hey guys, while you're BS'n about saddam and war and disputing religions, I am busy showing you how I make money in the markets. Have fun with whatever you're doing, but Ernie, your forum is turning into a monster. Not so huge...

[mrmarket]

OK,

I've had my fun. Sold them at $29.80... that's a $1.84 / share gain, or 6.58% in 2 friggin days, folks!!!

Hey guys, while you're BS'n about saddam and war and disputing religions, I am busy showing you how I make money in the markets. Have fun with whatever you're doing, but Ernie, your forum is turning into a monster. Not so huge...

I disagree..political debates are maintained tidily in separate threads. If you choose to ignore them, please do so.

[New-born baby]

OK,

I've had my fun. Sold them at $29.80... that's a $1.84 / share gain, or 6.58% in 2 friggin days, folks!!!

Hey guys, while you're BS'n about saddam and war and disputing religions, I am busy showing you how I make money in the markets. Have fun with whatever you're doing, but Ernie, your forum is turning into a monster. Not so huge...

You are huge, Peanuts, but I agree with Ernie: if you don't like the topics, ignore the thread. We need you around here and I hope you don't get discussed with my harping. I'll try to keep it to a minimum.

[New-born baby]

Peanuts,
How do you decide which sectors you are going to play?

[Tatnic]

OK,

I've had my fun. Sold them at $29.80... that's a $1.84 / share gain, or 6.58% in 2 friggin days, folks!!!

Hey guys, while you're BS'n about saddam and war and disputing religions, I am busy showing you how I make money in the markets. Have fun with whatever you're doing, but Ernie, your forum is turning into a monster. Not so huge...

peanut...you're just lucky which will be your downfall because you will confuse luck with trading accumen. But enjoy it will it lasts....if you can keep in the markets for a decade or so, you'll eventually be able to discern between luck and skill. And if you do your arrogance will also diminish and you'll make even more money.

[New-born baby]

peanut...you're just lucky which will be your downfall because you will confuse luck with trading accumen. But enjoy it will it lasts....if you can keep in the markets for a decade or so, you'll eventually be able to discern between luck and skill. And if you do your arrogance will also diminish and you'll make even more money.

Tatnic,
I do not think Peanuts is just lucky. The guy is good. Very, very good.
He works at it; he is young; and I think that by the time he's 40 he's going to be a multi-millionaire trader. I am sure he'll take a few hits between now and then, but you'll be reading his articles in a trader magazine someday. I really believe this.

[peanuts]

Peanuts,
How do you decide which sectors you are going to play?

First, I do tons of screens and scans. I get a list of stocks which meet some criteria which I make standard for all of my possible investments.

Second, I review each and every one of them and categorize them into their respective sectors.

Third, I create a Yahoo! portfolio for that sector and record, what I feel is, a loose fair value estimate for each share. I use this as my "buy" price in the tracking of the portfolio, so I get an idea of current value and my estimated fair value.

Fourth, I follow the news and different sector watching sites, and determine which sector is moving the fastest. Many times, however, I can just look at my various sectors and see which one is advancing the most.

Fifth, I look back to my Yahoo! portfolio for that sector and review the stocks in my watchlist. I base the stock decision on a few factors...
- P/E ratios
- Mkt Cap
- Avg Vol
- ROE
- % from 52 week highs
- Technical Analysis

Sixth, I form a plan and trade it.

Thanks for the kind words in your last message. I'm lucky in the sense that I have people to support me and not try to break me down.

[mrmarket]

peanut...you're just lucky which will be your downfall because you will confuse luck with trading accumen. But enjoy it will it lasts....if you can keep in the markets for a decade or so, you'll eventually be able to discern between luck and skill. And if you do your arrogance will also diminish and you'll make even more money.

Tatnic..in this forum, bragging is an acceptable mode of communication and when someone makes money, the appropriate thing to say is:

"Congrats"..

Well done, Peanuts.

[peanuts]

Tatnic..in this forum, bragging is an acceptable mode of communication and when someone makes money, the appropriate thing to say is:

"Congrats"..

Well done, Peanuts.

Thank you, sir... looks like I should have held just a little longer

[mrmarket]

Tower Group, Inc. Reports 45% Increase in Net Income; Company Delivers Record Results for 2006
Tuesday February 27, 7:00 am ET


NEW YORK--(BUSINESS WIRE)--Tower Group, Inc. (NASDAQ: TWGP - News) today reported its financial results for the fourth quarter of 2006, including a 45% increase in net income to $9.5 million as compared to net income of $6.6 million in the fourth quarter of 2005. For the year ended December 31, 2006, net income increased 77% to $36.8 million as compared to $20.8 million for the prior year.


Diluted earnings per share of $0.46 for the fourth quarter of 2006 were based on 20,483,388 weighted average diluted shares as compared with $0.32 per share for the fourth quarter of 2005, based on 20,200,584 weighted average diluted shares. For the year, Tower reported diluted earnings per share of $1.82, based on 20,147,318 weighted average diluted shares, as compared with $1.03 per diluted share for the year ended December 31, 2005 based on 20,147,073 weighted average diluted shares.

[jiesen]

A fortuitous side-effect of the Biosite buyout:

http://biz.yahoo.com/ap/070618/s_p_index_changes.html?.v=1

TTM, Tower Group to Join S&P Index
Monday June 18, 6:42 pm ET
TTM Technologies, Tower Group to Replace Viasys and Biosite on S&P SmallCap 600

NEW YORK (AP) -- Standard & Poor's said Monday that TTM Technologies Inc. and Tower Group Inc. will respectively replace Viasys Healthcare Inc. and Biosite Inc. on the S&P SmallCap 600.

TTM's replacement of Viasys becomes effective after trading ends Wednesday. Viasys is being acquired by Cardinal Health Inc. in a tender offer expected to expire that day.


Tower Group will replace Biosite after market close June 25. Biosite is being purchased by Inverness Medical Innovations Inc.


TTM Technologies shares added 4 cents to $12.14 Monday. Tower Group shares lost 13 cents to $32.26, but in aftermarket activity climbed $1.25, or 3.9 percent, to $33.51.


Shares of Viasys lost a penny to $42.69. Biosite added 2 cents to $92.22.

[jiesen]

I added to my TWGP position here at 31.5. That makes it a 3% position for me now. It's probably one of the strongest $$MM stocks right now, and I'm glad to be able to get it on sale today.

[mrmarket]

Tower Group's profit surges 28 percent in 1Q
Tuesday May 6, 8:49 am ET
Profit surges 28 percent in 1st quarter on higher premiums, investment income

NEW YORK (AP) -- Tower Group Inc.'s profit surged 28 percent in the first quarter as the insurer collected more in premiums and generated better returns on its investments, the company said Tuesday.
Tower Group earned $14.9 million, or 64 cents per share, in the first quarter, compared with profit of $11.6 million, or 49 cents per share, in the first quarter last year.

Operating income, which insurers emphasize because it excludes costs not considered reflective of business trends, was 60 cents per share, which according to a Thomson Financial survey met expectations.

Premiums grew 22 percent to $135.1 million.

Of each premium dollar collected, Tower Group spent 84.9 cents paying claims, more than a penny on the dollar less than the first quarter last year.

Chief Executive Michael H. Lee said in a statement the company "took advantage of profitable growth opportunities" in a challenging market.

Like most insurers, Tower Group collects premiums from insurance policies and invests those premiums in bonds or investment partnerships. Investment income vaulted 23 percent to $9.8 million.