Intact Financial (IFC.TO)

Even though it has had a big move, it is still trading on a PE basis of around 14X, versus its five-year average of 15.6X. Just did an acquisition from Canadian Western Bank (CWB-T), which will be somewhat accretive to this year’s numbers. A fragmented business, so future acquisitions really provide a source of upside.

Had a very good run because of the macro economic tailwinds. Fundamentally has a strong management team and it is growing. Stock looks pretty toppy at these levels, but on a fundamental basis it stacks up quite well when compared to others. A good entry point is when it is trading below Book Value and you exit when it is trading at a premium to Book Value. Currently it is trading at a good premium to the Book Value, so it is not a bad idea to take some money off the table.

(A Top Pick Jan 28/14. Up 36.04%.) 2013 profitability really took a hit, but rebounded a little in 2014 as he had suggested. He continues to like it.

Property and casualty. Steady Eddie 46% earnings per share growth. This is a fragmented market and future acquisitions serve as embedded catalysts. If they can make an accretive acquisition, investors in the next 12 months will benefit.

One of the largest property/casualty insurers. They consistently make a profit underwriting, so their costs to revenue is consistently below 100%, which is very rare in insurance. Trades at 11.5X earnings. Yield of 2.66%.

(A Top Pick May 3/13. Up 21.94%.) Still likes this. The largest PNC insurer in the country, which gives them a lot of advantages in terms of scale. Grows predominantly by acquisition, and she expects this to continue.

(A Top Pick May 15/13. Up 26.97%.) A quality company. Have signalled that they are possibly looking at some acquisitions. They normally buy back shares and increase their dividend. Very high quality underwriter. Dividend of about 2.6% and expecting earnings growth of 7%-10%. A good one to own for the next 3-5 years.

Property/casualty insurer. Q1 earnings were a little weak because of ice storms. Longer-term this is a consolidator in a highly fragmented market which is right for consolidations. CEO recently withdrew the normal course issuer bid Buy back shares because there are opportunities in the market to play. Yield of 3.08%.

(A Top Pick May 3/13. Up 11.09%.) They have size in scale advantage being the dominant insurer for home, auto and personal property in Ontario. Been under a little bit of pressure because of ice storms. Feels there are a lot of consolidation opportunities. Good growth story and is very defensive. Not inexpensive at 2X BV but they do have an 18% ROE, which is very good. 2.88% dividend yield.

Personal and commercial insurance. Took a beating in 2013 as its profitability was really crimped by the flooding in Alberta and the summer storms in Ontario. Sees profitability picking up sharply in 2014 and 2015. Very well-positioned in a rapidly consolidating industry. Mid-$70s in 12 months is certainly realistic.

(Top Pick May 15/12, Up 16.7%) Had some unknowns about rates in Ontario, and then there were the disasters across the country. Stock is up, but does not feel it is fully valued. Great dividend and dividend payout ratio. 10-11 times earnings. Good consolidator. Can grow by acquisition. Will likely grow premiums due to catastrophic losses. The Calgary flooding is behind them. A market leader.

(A Top Pick Nov 12/12. Up 5.51%.) Property and casualty insurance. Continues to be one of the very few properties/casualty that actually writes profitable insurance business. Very strong underwriting discipline. Good dividend yield. Should do a lot better.

(Market Call Minute.) Being in that part of the insurance industry is much better than being in the life side.

Solid company and a great way to play P&C insurance in Ontario. Recent sell off is people questioning what the impact of flooding in Calgary is going to be. It will be minimal to them. It will not impact their earnings power. There may be more issues to get through in Ontario auto.

Likes the company. They have been growing nicely. They were hit by the Alberta floods and that has been affecting the stock in the short term. Held up well as rates were coming down. Their liabilities are much more short term focused. They buy shorter term bonds so have less risk on the long term interest rate environment.