Alleghany CorporationY

Morningstar Rating

Stock Research and Analysis

by Jim Ryan

Alleghany's shrewd value-investing philosophy, coupled with a talented management, endows favorable prospects. However, we think Alleghany's economic moat has been dwindling for years and is now nonexistent.

Alleghany's long-term, value-oriented investment Read more

Bulls Say

Alleghany's long-term, value-oriented investing philosophy has generated a long history of attractive returns for its shareholders.

Alleghany may eventually make more private-equity investments, which could help boost returns on capital over the long haul.

Investments per share are $465, which at 1.6 times equity helps Alleghany earn leveraged investment returns. Read more

Bears Say

The insurance rate increases of recent years are slowly reversing in most markets, which will challenge premium growth at Alleghany's insurance subsidiaries.

Sustained low longer-term interest rates have moderately reduced Alleghany's investment income.

Relying on acquisitions for growth can sometimes turn out badly as the Employers Direct purchase has shown. Read more

Strategy

Alleghany strives to purchase investments at a deep discount to fair value and prefers to concentrate its portfolio in areas of expertise. The firm employs a long-term outlook, and in some cases, it Read more

Management

We think Alleghany's executives' large ownership stakes will continue to encourage good stewardship. Former CEO John Burns succeeded longtime chairman Fred Kirby. Kirby and his family still own about 33% of the stock, and Burns owns another 1.1%. Current Read more

Profile

Alleghany is an investment holding company that uses a value-oriented philosophy to acquire interests in attractive businesses. The firm purchases fractional and outright Read more

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