Assured Guaranty Ltd. (NYSE:AGO)

CAPS Rating: 3 out of 5

A holding company that provides, through its operating subsidiaries, credit enhancement products to the public finance, structured finance and mortgage markets.

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Member Avatar butzloffrost (< 20) Submitted: 1/24/2016 1:41:36 PM : Outperform Start Price: $23.56 AGO Score: -2.43

Assured Guaranty (AGO) is not at risk and should not reflect how the market is reacting to news.

PREPA (Puerto Rico Electric Power Authority), which is a small portion of the entire portfolio of which AGO and its subsidiaries hold, are insignificant to tremendously impact the company in comparison to its other larger percentage type bonds. According to the financial fact sheet, Understandably, Assured Guaranty has PREPA bonds which have a CC credit rating but are a small amount in their portfolio. There have been plans in place to restructure the debt owed to AGO. An investor can therefore expect to see lower levels of cash but yet still roughly similar financial statements in the future. The company rather has growing operating cash flows (other than Q3), consistent track record of paying off its debt, and great credit rating, which are all good signs.

AGO, proving its shareholder-friendliness, has consistently bought back shares in the past few years and increased its dividends.

I am in doubt that AGO will stop its share repurchase program anytime soon... unless its stock becomes too expensive. Additionally, AGO has not only consistently paid its dividends, but they have also raised its dividends since 2004. Temporarily, they may have less cash on their balance sheet due to the restructuring of debt, however the consequences of restructuring debt should have a neutral effect on the operating business belonging to AGO in the long run (10 years).

Not any significant surprises can be found in its SEC filings or in the news.

After rummaging through AGO's annual report and proxy statements, nothing surprising that would impact its business operations really stood out to me. AGO did not have significant off balance sheet items, their top management team didn't appear to be overpaid, and the level of business risk was overall a 2 out of 5 in my opinion. What is my suggestion to value investors out there? Buy AGO shares and let the dividends swallow up larger portions of its stock and then wait for the company's true market value to be realized. After a thorough assessment of the company, I believe company's market cap should be at least 5.2 billion but not more than 7 billion.

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Member Avatar gwolford (40.29) Submitted: 1/7/2016 8:07:46 PM : Outperform Start Price: $25.72 AGO Score: -7.79

Already wrote off a large amount relating to Puerto Rico; interest rate increase will help; great management

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Member Avatar BetaLocker (< 20) Submitted: 8/10/2013 7:18:16 AM : Outperform Start Price: $21.60 AGO Score: -6.24

Because it has a good score on my scale of excellence:
2,92;22,61;9,456;0,652;4,639

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Member Avatar BigPapaMoe (28.84) Submitted: 4/27/2012 10:22:15 AM : Outperform Start Price: $13.09 AGO Score: +38.92

Value play

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Member Avatar Pennyperson (< 20) Submitted: 2/10/2012 2:40:25 PM : Outperform Start Price: $10.37 AGO Score: +55.88

AGO looks like to be in the sweet spot. Complete some D&D, I'd say we're heading to 30+

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Member Avatar glake1 (62.89) Submitted: 12/6/2011 6:00:29 PM : Outperform Start Price: $11.61 AGO Score: +45.85

one of the smartest insurer around

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Member Avatar 1stMartian (< 20) Submitted: 12/6/2011 1:07:06 PM : Outperform Start Price: $11.76 AGO Score: +43.63

Good ROI, increasing cash flow in a tough public debt and real estate economy, and a decent balance sheet. And I am of the opinion that the government will get their act together, on the debt issue, later next year.

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Member Avatar mrindependent (37.01) Submitted: 10/28/2011 4:20:18 PM : Outperform Start Price: $11.94 AGO Score: +42.02

value stock

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Member Avatar MrPrognosticator (75.28) Submitted: 12/23/2010 1:24:11 AM : Underperform Start Price: $15.86 AGO Score: +6.16

This is a financial insurance company. Oooo scary! It's primary source (85%) of income is similar to PMI but with financial instruments such as Bonds, where they insure against a failure to pay principal and interest when due and similar credit events. Their exposure to actual PMI is 1% of their business. The other 14% is reinsurance, where they insure someone who is insuring someone else. That sounds really safe.

While reading about this company I began to wonder how it came to be on my radar and then I realized it was because it had increased it's income by "616.3%" since last year, or in easier to understand terms it went from earning -$35 million to $180.9 million. Honestly I question it's solvency. Plus it's not in the low competition side of insurance, it's in the very competitive side of insurance where market forces force companies to pay out slightly more than intake premiums. And if you've read my other insurance company write ups, I hate that.

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Member Avatar Tagit (< 20) Submitted: 12/2/2010 9:47:11 AM : Outperform Start Price: $15.27 AGO Score: -5.82

BYE BYE ABK = go go go AGO. Price entry seems correct and will probably see $25 sooner than you think.

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Member Avatar ValueDragonStyle (64.09) Submitted: 7/26/2010 12:54:34 AM : Outperform Start Price: $14.18 AGO Score: -9.45

Assured Guaranty Ltd. (AGO)
A holding company that provides, through its operating subsidiaries, credit enhancement products to the public finance, structured finance and mortgage markets.

AGO is down 43% from its 52W high, but still approx. 250% up from its March 2009 low.
I like AGO a lot. My kind of value stock.

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Member Avatar jsgant13 (98.10) Submitted: 7/9/2010 3:04:01 PM : Outperform Start Price: $13.76 AGO Score: -9.04

fine pick (with MBI and MF)

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Member Avatar yazlf7 (< 20) Submitted: 5/19/2010 8:34:36 PM : Outperform Start Price: $13.01 AGO Score: +2.84

These munis won't default - the market won't touch them for a long time. AGO well below book.

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Member Avatar mukwonago53149 (< 20) Submitted: 5/10/2010 1:35:03 PM : Underperform Start Price: $17.44 AGO Score: +31.91

Turns out, one ill-fated company is on the hook for the lion’s share of Muni Bonds. They insured $2.56 billion-worth in the last half of 2009 alone… 64x more than Berkshire Hathaway Assurance Corp. Last year, their operating income was $316.7 million. That means if just 12% of their loans go bad, they’ll be wiped out. Whoops! They’re rated AAA by Moody’s and Fitch. But that’s a complete farce. The same agencies stamped their “AAA” approval on AIG, Lehman Brothers and dozens of other firms that plummeted to earth in 2008. Don’t be fooled… As the public finally wakes up to the ugly truth, this insurer will come under intense selling pressure. It’s going to be the next AIG-like crash.

They were nearly wiped out by defaulting sub-prime mortgages. Since then, their share price has risen 505%. But soon, they’ll be slammed by an even bigger wave of defaulting Muni Bonds. The perfect time to bet against them is NOW.
Like Warren Buffet says…
“[When] a few communities stiff their creditors and get away with it, the chance that others will follow in their footsteps will grow. What mayor or city council is going to choose pain to local citizens in the form of major tax increases over pain to a far away bond insurer?”
http://www.sovereignsociety.com/pages/svs/48Enrons0510.php?pub=SVS&code=ESVSL535&o=101478&s=103200&u=47393188&l=115283&r=Milo

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Member Avatar sentinelbrit (70.32) Submitted: 3/23/2010 11:51:51 AM : Outperform Start Price: $18.55 AGO Score: -37.93

Classic value play: company not very well understood, fears related to municipal insurance overdone, strongest player in its businesses, earnings power undervalued, cheap on P/BV and PER. Potential 2 bagger - and would still be less than book value.

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Member Avatar lease101 (< 20) Submitted: 11/17/2009 2:50:03 PM : Outperform Start Price: $22.42 AGO Score: -67.07

Wilbur Ross, King of the Bottom Feeders. Prime for buyout by Goldman or Berkshire. The only game in town.

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Member Avatar spider42000 (< 20) Submitted: 8/29/2009 4:37:29 PM : Outperform Start Price: $16.96 AGO Score: -49.82

It has great management.

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Member Avatar bhaskarb (77.18) Submitted: 6/9/2009 4:23:18 PM : Outperform Start Price: $13.83 AGO Score: -34.10

One of the few bond insurers along with berkshire to still not have junk ratings. They have been very selective in insuring bonds and that will help. Acquistion of FSA muni unit makes them the biggest bond insurer in the industry

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Member Avatar staffier (75.84) Submitted: 5/8/2009 10:55:45 AM : Outperform Start Price: $3.53 AGO Score: +376.30

May 8th, 2009, and AGO still earns just 1 star?

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Member Avatar badmanner (94.26) Submitted: 10/8/2008 10:09:30 AM : Outperform Start Price: $9.62 AGO Score: +45.55

rally picks

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