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Look mom…no hurricanes! What’s better than an insurance company jacking up their premiums but don’t have to pay out because there are no hurricanes?
Today I bought Slide Insurance (SLDE) at $27.09. I will sell it in 4-6 weeks at a price target of $31.29. For all you weather channel addicts, and earnings-per-share nitpickers starts let's look at the facts.
First of all, we all know that $$$MR.MARKET$$$ is HUGE. Not regular huge. Not football stadium huge. Not aircraft carrier huge. I'm talking Godzilla-riding-a-monster-truck-through-Times-Square huge. But you don’t have to be a rocket scientist to see that the Valuation of SLDE Is Borderline Absurd! Slide now expects full-year 2026 net income of $500 million to $520 million. Yet the stock continues to trade at a valuation that would make you think management was operating a lemonade stand during hurricane season. The company recently raised guidance from $455-$470 million to $500-$520 million. Companies don't raise guidance by that magnitude because business is slowing. They raise guidance because they're executing. And Slide isn't just executing. They're executing while expanding geographically, increasing capital returns, building excess liquidity, and preparing for potential acquisitions. That's not a company treading water. That's a company swimming with a jet engine strapped to its back.
Insurance is actually simple. The great insurers write profitable business. The bad insurers write business and pray. Slide is firmly in the first category.
Third quarter results were ridiculous:
The Hurricane Boogeyman Is Already Priced In Every time someone hears "Florida insurer," they immediately imagine a category 9 hurricane carrying sharks, alligators, and flaming debris. The reality is very different. Management specifically stated that their full-year profit guidance already includes as much as $50 million in pretax losses from Hurricane Isaias. Not only that, CEO Bruce Lucas described the estimate as intentionally conservative. In other words: The market sees a storm cloud. Management sees a drizzle.
Meanwhile, Slide has built one of the largest reinsurance programs in the industry and recently secured a $1.07 billion credit facility, the largest ever issued to a coastal property insurer. You don't get financing like that because lenders think you're one thunderstorm away from extinction. You get financing like that because sophisticated institutions believe you're a strong counterparty.
Management announced:
Expansion Is Just Beginning The growth story is far from over. California is ramping. Texas has launched. New York and New Jersey are expected next. Management expects at least 8-9% growth moving forward, before fully considering contributions from new markets. So you have a company with a PE ratio of only 6.2 that projects 9% growth…hmmmm. Think about that.
The company is already generating elite profitability primarily from Florida, yet new states are only beginning to contribute meaningful volume. One of the most overlooked aspects of the story is the massive new credit facility. Management openly stated that one purpose is strategic M&A. High-performing operators with excess capital often become consolidators. When weaker competitors struggle, the strongest players get to buy attractive assets at favorable prices. Slide now possesses the financial flexibility to do exactly that.
To summarize:
A company generating:
The stock merely needs investors to digest:
I am HUGE!!
$$$MR. MARKET$$$
www.mrmarketishuge.com
Today I bought Slide Insurance (SLDE) at $27.09. I will sell it in 4-6 weeks at a price target of $31.29. For all you weather channel addicts, and earnings-per-share nitpickers starts let's look at the facts.
First of all, we all know that $$$MR.MARKET$$$ is HUGE. Not regular huge. Not football stadium huge. Not aircraft carrier huge. I'm talking Godzilla-riding-a-monster-truck-through-Times-Square huge. But you don’t have to be a rocket scientist to see that the Valuation of SLDE Is Borderline Absurd! Slide now expects full-year 2026 net income of $500 million to $520 million. Yet the stock continues to trade at a valuation that would make you think management was operating a lemonade stand during hurricane season. The company recently raised guidance from $455-$470 million to $500-$520 million. Companies don't raise guidance by that magnitude because business is slowing. They raise guidance because they're executing. And Slide isn't just executing. They're executing while expanding geographically, increasing capital returns, building excess liquidity, and preparing for potential acquisitions. That's not a company treading water. That's a company swimming with a jet engine strapped to its back.
Insurance is actually simple. The great insurers write profitable business. The bad insurers write business and pray. Slide is firmly in the first category.
Third quarter results were ridiculous:
- Revenue up 35.9% year over year.
- Net income up 24.5% year over year to $138.2 million.
- Gross written premiums up 9.3%.
- Return on equity tracking above 40%.
- Combined ratio of 59.3%.
- Accident-year ex-catastrophe combined ratio of 54.4%.
The Hurricane Boogeyman Is Already Priced In Every time someone hears "Florida insurer," they immediately imagine a category 9 hurricane carrying sharks, alligators, and flaming debris. The reality is very different. Management specifically stated that their full-year profit guidance already includes as much as $50 million in pretax losses from Hurricane Isaias. Not only that, CEO Bruce Lucas described the estimate as intentionally conservative. In other words: The market sees a storm cloud. Management sees a drizzle.
Meanwhile, Slide has built one of the largest reinsurance programs in the industry and recently secured a $1.07 billion credit facility, the largest ever issued to a coastal property insurer. You don't get financing like that because lenders think you're one thunderstorm away from extinction. You get financing like that because sophisticated institutions believe you're a strong counterparty.
Management announced:
- Regular dividend of $0.07 per share.
- Special dividend of $1.50 per share.
Expansion Is Just Beginning The growth story is far from over. California is ramping. Texas has launched. New York and New Jersey are expected next. Management expects at least 8-9% growth moving forward, before fully considering contributions from new markets. So you have a company with a PE ratio of only 6.2 that projects 9% growth…hmmmm. Think about that.
The company is already generating elite profitability primarily from Florida, yet new states are only beginning to contribute meaningful volume. One of the most overlooked aspects of the story is the massive new credit facility. Management openly stated that one purpose is strategic M&A. High-performing operators with excess capital often become consolidators. When weaker competitors struggle, the strongest players get to buy attractive assets at favorable prices. Slide now possesses the financial flexibility to do exactly that.
To summarize:
A company generating:
- More than $500 million in annual earnings.
- Return on equity above 40%.
- Industry-leading underwriting margins.
- New-state expansion.
- Special dividends.
- Share repurchases.
- Excess liquidity.
- Massive borrowing capacity.
The stock merely needs investors to digest:
- Raised earnings guidance.
- $500-$520 million profit outlook.
- Special dividend announcement.
- Geographic expansion progress.
- Continued underwriting dominance.
- Strategic flexibility from the $1.07 billion facility.
I am HUGE!!
$$$MR. MARKET$$$
www.mrmarketishuge.com