Investment management company Bireme Capital recently released its fourth-quarter 2023 investor letter. A copy of the same can be downloaded here. In 2023, the fund returned 21.3% net of fees underperforming the S&P 500’s 26.2%. The fund was up 448% net since inception in 2016 vs the S&P at 161%, an annual outperformance of 11.7%. Last year was the second calendar year in a row that the fund underperformed the S&P 500, and the first since 2019. Nonetheless, the firm is particularly proud of last year’s returns because 2023 was an extraordinarily tough year for the relative performance of active value managers. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Bireme Capital featured stocks such as Old Republic International Corporation (NYSE:ORI) in the fourth quarter 2023 investor letter. Headquartered in Chicago, Illinois, Old Republic International Corporation (NYSE:ORI) engages in the insurance underwriting and related services business. On February 5, 2024, Old Republic International Corporation (NYSE:ORI) stock closed at $27.51 per share. One-month return of Old Republic International Corporation (NYSE:ORI) was -6.65%, and its shares gained 3.23% of their value over the last 52 weeks. Old Republic International Corporation (NYSE:ORI) has a market capitalization of $7.713 billion.
Bireme Capital stated the following regarding Old Republic International Corporation (NYSE:ORI) in its fourth quarter 2023 investor letter:
“Our investment in Old Republic International Corporation (NYSE:ORI) has performed quite well since our last letter at the end of May, up about 18% including dividends. The company’s General Insurance (GI) business has been thriving, offsetting the expected declines in Title Insurance profits. Over 2023, revenue grew 8.2% in that segment and margins were robust. GI underwriting has been extremely strong, with the combined ratio (insurance losses and SG&A as a percentage of premiums collected) down to 90%, well below the 2010-2020 average of 97%. We expect combined ratios to normalize from here, crimping underwriting profits, but increased income on the float due to higher interest rates should more than offset these declines. In line with this forecast, investment income grew 26% in 2023 at ORI. We forecast profits in GI to grow from $788m in 2023 to $1.2b in 2027. Consolidated net income at ORI should increase from $750m in 2023 to almost $1b. We believe investors misunderstand ORI because they are too focused on ORI’s floundering title insurance business. However, even if the title insurance business never fully recovers, we believe that the stock remains undervalued today at an $8b market cap.”
A successful independent agent or broker discussing the benefits of life and health insurance with a customer.
Old Republic International Corporation (NYSE:ORI) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 21 hedge fund portfolios held Old Republic International Corporation (NYSE:ORI) at the end of third quarter which was 21 in the previous quarter.
We discussed Old Republic International Corporation (NYSE:ORI) in another article and shared the list of best dividend stocks for an early retirement portfolio. In addition, please check out our hedge fund investor letters Q4 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
