Multiple Insiders Bought Shares of Markel

CNA Financial Corp (NYSE:CNA), Meadowbrook Insurance Group, Inc. (NYSE:MIG), and The Travelers Companies, Inc. (NYSE:TRV) are three peers for Markel. The forward P/Es at these companies are in the 8-11 range, even in the case of Travelers which is a much larger company by market cap. Not only are those multiples cheap by themselves, they represent quite a large discount to where Markel trades. CNA and Meadowbrook also have quite low P/B ratios, of 0.6 and 0.5 respectively, so the market is valuing them at a sizable discount to Markel on that basis as well (in addition to their own book values). We think that there is a good case for taking a closer look at those two companies, though in Meadowbrook’s case we would need more details as to how the company will achieve that multiple given that its earnings have not been good recently. Travelers has a P/B of 1.1; with very low revenue growth in its most recent quarterly report versus a year earlier, it’s a closer call but its earnings multiples are so much lower than Markel’s that we think it is a more attractive investment as well. There are consensus insider purchases at Markel, and investors who find that particularly appealing could certainly examine the company more closely, but in general we would say that the company’s peers seem to be better values.