Raleigh insurer James River impresses investors
The company, which was founded in
"Our folks are insuring thousands and thousands of small and mid-sized businesses all over the country and have paid well over
James River fell below the radar in 2007 when the business, which was publicly traded at the time, was acquired for
But in December, James River went public once more by selling 11 million shares at
"The company had achieved a lot of the things that we had set out to achieve when we started with the
Abram previously founded another insurance holding company, Front Royal, that sold for
The company generated
Five of the six analysts who track James River rate its stock a "buy" or its equivalent.
"We believe that James River has a high-quality specialty business ... and a strong management team with a superb record of delivering shareholder value,"
Going forward, Shields noted, "despite the near-term outlook of intensifying price competition, we believe that James River's focus on profitability over volume will sustain strong margins."
The company's bread-and-butter is liability insurance for small and mid-sized businesses, which Shields pointed out is "less exposed to the most competitive areas of the current market."
Odd things
James River's primary competition is other specialty insurers.
The company offers a broad range of liability insurance, such as product liability for manufacturers and covering restaurants for problems such as slip-and-fall and food poisoning.
"Then we write odd kinds of things," said Abram, who noted that, in states where medical marijuana is legal, it writes liability policies for marijuana dispensaries.
"We tend to write insurance for businesses that can't get it, generally, through the standard (insurance) market" because, for example, they are in a particularly risky business or because they are new companies that haven't yet established a track record, Abram said.
"The core of our company," Abrams said, "is a relatively large group of very experienced underwriters who are in
The upswing in the U.S. economy has helped to boost James River's performance because growing customers pay larger premiums when they renew their policies.
"When the economy does well and we retain customers, it's good for the customers and it's good for us," Abram said.
In addition, the company's workers' compensation insurance business, which contracted in the wake of the recession because it focused largely on residential homebuilders in
Abram is upbeat about the company's future.
"We said during the IPO process that we thought premiums would grow in 2015 over 2014 by the low to mid double-digits," percentage-wise, he said.
Ranii: 919-829-4877
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