high turnover, page-11

All

Looks to me like the penny has finally dropped! CIX NTA per share is listed as $0.18 (page 5 of Annual Report), with Net Assets per share of $0.42. Clearly, the "sale" value of CIX most likely lies somewhere between the two; although this does not take into account the value of the GWP of $245 million. To a larger, more efficient insurer, that book would have some value (as their COR would be far less than Calliden's).

The current share price of circa $0.13 is, by any standard, a gross underestimation of CIX's value and, in my view, is simply not sustainable. Unless CIX is sitting on some sort of land mine, there is no reason to doubt that the SP will move back towards $0.20 sometime soon.

One problem is, however, that the current major shareholders are unlikely to part with their parcels at such levels, so any takeover is unlikely to succeed sub 25 cents. That said, there is no reason why CIX would now not be subject to "approaches" from other insurers for some of their book (or books).

Interesting times ahead. At these levels I am now convinced it is a case of pin your ears back and buy. Could be wrong, but I see downside as limited from here.

Best regards to all

Kit