NU Stock Analyst

Thanksgiving for investors in insurance stocks was close to a balanced meal. We ate the turkey–it was delicious–and picked at the feathers. In sum, the month of November and Turkey Day were satisfying events, marred chiefly by insurance stocks again underperforming the general market.

The November portfolio contained 119 stocks. In total they moved up under 4%. There were 74 advances and 45 declines, which was close enough to a win/lose ratio of 3/2 to pronounce it so. Five of the eight industry groups advanced and three ended down for the month.

The Financial Services stocks earned top honors with a lusty 8.72% gain. All eight of the Financial Services issues were up in November.

Note that UBS has been added to the Financial Services sector. UBS, standing for Union Bank of Switzerland, is reported to be the largest asset manager in the world. Some two years ago the Swiss giant acquired Paine Webber, and since then has been expanding its money management business in the USA.

The Multi-lines registered almost as robust an advance as the Financial Services stocks. In a group of nine there were three gains of more than 20%. The Multi-lines ended up 8.1%.

The Specialist group registered a 6.14% gain to become third best for November.

The largest groups, the P&C and L&H sectors, were chiefly noteworthy for underperforming the major averages in November. The Life & Health stocks were up 4.18% and the Property & Casualty issues advanced 5.12%.

In the L&H area there were several conspicuous gainers including health insurer, Ceres Group, Universal American Financial, Lincoln National, American National of Galveston and Cotton States of Atlanta.

And if investors think the stocks of major insurance companies dont make double-digit monthly moves, just note MetLife made a very nice 12.40% advance!

So let us sign off on the first eleven months of a very challenging year and look forward to a better year to come. In the meanwhile, let us try to enjoy the most reliable event in our specialty. That is our “Guaranteed Year-end Rally.” Only once in your columnists long career in insurance stocks has there not been a year-end rally! And that, depending on memory, was 1957, when stocks peaked around Thanksgiving and trended down afterward.

So its Happy Holidays to you and may you enjoy a bountiful New Year!

Mr. Meakin is affiliated with LIM Systems International in Voorhees, N.J. Stock results are supplied by The Firemark Group in Morristown, N.J.


Reproduced from National Underwriter Life & Health/Financial Services Edition, December 30, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.