Saturday, June 11, 2016

" It is time for this value investor to invest with confidence with one of the best value investors, David Einhorn. I am putting my money to work in Greenlight Capital RE LTD.. The stock is a great value right here and insiders are buying it. "

Dow Jones Industrial Average 17,865.34 (Down) Week ending 06-10-2016.

Greetings. I guess you have all heard of Berkshire Hathaway run by Warren Buffett's value investment team with its Geico Insurance company. Buffett takes the cash flow from his stock investments and invest it back into value stocks.

Well,  Greenlight Capital RE LTD.  (Symbol GLRE, $19.73 ) is in a number of different insurance and reinsurance businesses. Their cash flow is managed and invested by DME Advisors that is headed by hedge fund manager and prolific Value investor, (and also Chairman of the company ),  David Einhorn. David runs a Long/Short value based strategy with the companies investments and traditionally has done very well. 

Greenlight ,GLRE is a great buy right now because David is coming off of a real klunker of year in 2015 , with a per share earning loss of (-$9.07) per share. Sun Edison, Micron Technology and a double down on Consol Energy the big culprits of that 2015 loss year.  

So that has provided a great opportunity to get in the stock here at a ground floor price and have David Einhorn be involved with making himself and you some big money. GLRE back in 2014 and 2015 was trading at $35.00 per share. 

 David Einhorn - Value Investor
Greenlight is projecting 2016 earnings per share of $2.61 per share a PE of 6.36 and 2017 earnings per share of $3.29 per share with a forward PE of 5.64. 

Similar to MetLife, that I wrote about in my last blog article, Greenlight is trading under current book value at a 0.86 ratio and has a current book value of $23.04. The target price by analyst on the stock is $31.00 per share. I calculate that at around a 57% gain if it just returns to that historical mean number and target.

Sales Quarter over quarter are up 137.3 % and EPS Q/Q are up 218%. Very easy comparisons to go against from 2015. 

David is heavily weighted in consumer cyclical stocks at around 35% of his portfolio. We will just let him do his thing and get back to his winning ways. He has almost $6 Billion dollars under management. 

Einhorn, along with Soros and Buffett, has recently been buying up shares of Apple Inc., (Symbol AAPL) , at bargain prices here.

I like this stock as a buy and hold till it gets to its target price then I would review the situation again at that time. 

Mr. Einhorn is also a prolific poker player and prolific philanthropist.  I like that!

Have a wonderful summer. Remember you don't have to own every stock. Just own a few that give you the best odds in your favor of making some money. GLRE is one of them at this time.


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