Closing the Primerica Experiment

One year ago I embarked on a mission to determine whether Primerica stock (PRI) was a better investment then the sum of its’ parts – well at least most of the parts.  SEC filings were scoured to identify their investments as insurance companies are required to maintain reserves (the float).  A portfolio was established (3Q 2015) , funded (4Q 2015) and tracked (Oct 2015 to Sep 2016) to be able to declare a winner.

And the winner is … Primerica by 16.15%.  Now I realize that a single snapshot in time may not be reflective of reality, but to my surprise Primerica outperformed the basket through this snapshot in time.

QUARTERLY COMPARISON

PRIMERICA BUNDLE DIFF
Q4 2015 8.92% 6.4% -2.52%
Q1 2016 -5.34%  3.57% 8.91%
Q2 2016 27.98%  -11.52% -39.5%
Q3 2016 -7.32%  9.64% 16.96%
NOTE: Q2 for PRI included new Dept..of Labor rules that were beneficial
NOTE: Q2 – Fed not raising rates and Brexit concerns impacted the Bundle.
NOTE: Q3: CCAR results and dividend increases weren’t enough for the bundle to recover.

I guess solace can be found that in the absence of external events both performed fairly evenly.  The following table presents the individual results of the bundle along with my comments.  Bottom line, now that my self-imposed restrictions have expired, I intend to selectively add to existing positions based on market circumstances. I categorized the holdings generally across sector allowing for a little latitude for my own theories.

INSURANCE
TICKER PERFORMANCE
ALL 10.14%
LNC -7.3%
TRV 1.13%
MET -8.1%
AIG -3.59%
Notes: MET is performing a spin and AIG has an activist.
Comment: ALL and TRV were best performers.
INVESTMENT
TICKER PERFORMANCE
LM -15.31%
IVZ -4.79%
BEN -3.71%
Comment: Rumors of industry consolidation makes these a hold.
BANKING
TICKER PERFORMANCE
BAC -9.78%
GS -11.74%
C -10.65%
BK -3.13%
STT 3.64%
MA 3.12%
Comment: CCAR should allow for dividend growth. STT, MA, and BK reside in my Transaction Strategy..
THE OTHERS
TICKER PERFORMANCE
IBM 14.74%
GE -3.62%
WRE 14.16%
DRE 30.49%
EFX 19.57%
MORN -2.93%
Comment: I like IBM’s cloud and Watson, GE’s potential and MORN’s entry into ratings..
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