TIPTREE INC TIPT
October 12, 2021 - 7:43am EST by
goob392
2021 2022
Price: 10.75 EPS 0 0
Shares Out. (in M): 34 P/E 0 0
Market Cap (in $M): 365 P/FCF 0 0
Net Debt (in $M): 0 EBIT 0 0
TEV (in $M): 0 TEV/EBIT 0 0

Sign up for free guest access to view investment idea with a 45 days delay.

 

Description

 

Specialty Insurance Sub Fortegra valued at less than BV with stock at $10.75.  Deal announced this morning with Warburg Pincus values Fortegra at about 2X BV for 20-25% of the business and recasts the corporate balnce sheet by paying off intercompany debt.

Fortegra: nice specialty insurence business they bought in 2014 and have grown and improved since.  low 90s CR, mid/high teens ROE. BV (pre-deal) $8.50.

Tip Tree Capital: the investment piece (outside of Fortegra). own fiancials (mortgage) and real assets (shipping and senior care). BV $5.50. let's say it's worth BV to be conservative.

Corporate: was negative $2.60 due to intercompany debt, now positive $1.83 post deal).

Total: impled value of Fortegra $16.20 , TC $5.52 and corp (cash):$1.83  =   $23.55.

Yes, i know it will not trade at $23.55 but it will not stay at $10.75 either

 

 

 

I do not hold a position with the issuer such as employment, directorship, or consultancy.
I and/or others I advise hold a material investment in the issuer's securities.

Catalyst

Warburg transaction highlights value of Fortegra specialty insurance and likely results in faster growth and highe rprofile going forward.

    show   sort by    
      Back to top