雅虎香港財經 Markel Corporation (MKL) Gained on Interest Rate Hikes
Giverny Capital, an investment management company, recently published its fourth-quarter investor letter in 2022. A copy of the same can be downloaded here. The model portfolio of the firm appreciated 8.49%, net of fees in the fourth quarter compared to a 7.56% return for the Standard & Poor’s 500 Index. For 2022, the fund delivered a -22.65% return compared to a -18.11% return for the Index. Oil and energy was the strongest sector in the year increased by 65%. In addition, you can check the top 5 holdings of the fund to see its best picks for 2022.
Giverny Capital highlighted stocks like Markel Corporation (NYSE:MKL) in its Q4 2022 investor letter. Headquartered in Glen Allen, Virginia, Markel Corporation (NYSE:MKL) is a financial holding company that underwrites insurance products. On January 27, 2023, Markel Corporation (NYSE:MKL) stock closed at $1,396.55 per share. One-month return of Markel Corporation (NYSE:MKL) was 6.00%, and its shares gained 13.29% of their value over the last 52 weeks. Markel Corporation (NYSE:MKL) has a market capitalization of $18.784 billion.
Giverny Capital made the following comment about Markel Corporation (NYSE:MKL) in its Q4 2022 investor letter:
"The market really punished growth stocks that stopped growing, even if only temporarily. We own several businesses with long-term track records of compounding their earnings at double digit rates, that trade for less than 15 times consensus estimates of 2023 earnings. Our insurers Markel Corporation (NYSE:MKL) and Berkshire Hathaway also trade for about 15 times their expected 2023 operating profit after we back out the value of their large portfolios of common stocks.
Not so long ago, a PE multiple of 15x was not considered inexpensive. But the current PE multiple for the overall stock market remains 17x 2023 estimates and the risk-free rate of return on 10-year US Treasuries is below 4%. I like our inexpensive growers more than either of those alternatives.
At the top of our performance list, Progressive Corp. rose 26% for the year as it generated outstanding results relative to other large auto insurers. Markel and Berkshire Hathaway rose modestly. The three companies compete in diverse lines of insurance, but they all benefit from rising rates for property coverage after an extended period of weather catastrophes, rising jury awards in lawsuits and inflated loss costs. Our insurers tend to be careful underwriters, so their profitability rises with rates. Our insurers also benefit from rising interest rates because they tend to invest premiums paid by customers into fixed income securities until they pay claims."
Copyright: convisum / 123RF Stock Photo
Markel Corporation (NYSE:MKL) is not on our 30 Most Popular Stocks Among Hedge Funds list. As per our database, 32 hedge fund portfolios held Markel Corporation (NYSE:MKL) at the end of the third quarter, which was 26 in the previous quarter.
We discussed Markel Corporation (NYSE:MKL) in another article and shared Madison Funds’ views on the company. In addition, please check out our hedge fund investor letters Q4 2022 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
