That Will Acquire GMAC’s U.S. Consumer Property and Casualty Insurance Business

Old news, catching up prior to Q3 announcement. AFSI release third quarter 2009 earnings following the close of the market on Tuesday, November 3, 2009

Barry Zyskind, President and CEO of AmTrust (AFSI), stated, “This investment is not only a very attractive preferred equity investment for AmTrust, but it provides strong strategic advantages as well. Primarily it provides us immediate access to a new distribution force of 10,500 agents that will be equipped to cross sell our AmTrust products. Additionally, this investment will generate substantial fee income for AmTrust, from both the development of our unique IT platform and for asset management services, as well as generate underwriting profits through the contemplated reinsurance agreement.”

Zyskind is a guy worth hitching a ride from. His capital allocation is superb and his ability to deliver exceptional deals like this improves the probability of good returns for the business and investors. This deal comes on top the transaction entered in late August to acquire CyberComp, the workers’ compensation business unit of Swiss Re, in a renewal rights transaction

Earnings

Up until Q2 2009 AFSI had been on an earnings beat roll, with 10 out of 10 beats. I’m expecting Q3 earnings to make it 11 beats out of 12.

via yahoo estimates

Dividends

“AmTrust Financial Services, Inc. (AFSI), which operates as a specialty property and casualty insurance company, raised its quarterly dividend by 20% to $0.06 per share. This represents the fourth consecutive dividend increase for AmTrust Financial Services, Inc since the company went public in 2006 The stock currently yields 2.10%.” May09

Last dividend, $0.06 paid October 15.

From the Horses Mouth

“FOCUSED CAPITALIZATION
We are pleased to report that in 2008, we declared cash dividends of $0.18 per share of Common Stock, a 64% increase compared to 2007. We continue to work towards maximizing our returns on equity and achieved operating returns of 32.3% for 2008, compared to 23.8% for 2007. The Company’s debt to capitalization ratio was 32.0%, with total assets as of December 31, 2008 of $3.1 billion, compared to $2.3 billion at the end of 2007. We anticipate that our quota share agreement with Maiden Insurance Company, Ltd. will enable us to continue to leverage our balance sheet, increase our writings, decrease our expense ratio and most importantly, increase our return on equity.”

2008 Annual Report

via yahoo key stats

Disclosure: Long AFSI.

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3. AmTrust Financial Services Inc. (AFSI) Q3 2009 Earnings
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