Returns to the Markel Investment

Chapter 11 lays out how to investment in a property and casualty insurer. Markel Corporstion was the target firm. The price was $1,476.19 per share in the first quarter of 2022. A good BUY?

The approach to answering this question follows the same scheme as in the rest of the book: Find the market’s pricing of growth, then challenge that growth rate with sound business thinking and sound analysis. The market’s implied growth rate for the insurance operation was -4.42%. This looked like a BUY: The market was implying negative growth.

Fast forward to March, 2025 when Markel traded at $1,915.50 with no dividends. The return over almost three years was 29.8%.