Why National Interstate Corporation Shares Skyrocketed

National Interstate becomes a bullseye for a rival. Should shareholders be content with this buyout offer or be looking for more?

Feb 5, 2014 at 3:12PM

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of National Interstate (NASDAQ:NATL), a specialty property and casualty insurer in the U.S. and Cayman Islands, soared as much as 32% after receiving a tender offer from American Financial Group (NYSE:AFG) subsidiary Great American Insurance Company.

So what: According to the press release from American Financial Group, its subsidiary has offered to purchase National Interstate for $28 in cash per share, without interest, representing a 26% premium above yesterday's closing price. The tender offer is set to expire on March 6, unless the offer is extended beyond that date or terminated early. National Interstate has not made any comments as of yet as to its take on the tender offer.

Now what: Just the simple fact that shares are currently trading at approximately $1 per share above the offer price is an indication from investors that they expect either a competing bid to emerge or for American Financial Group to raise its price. Playing the tender offer game certainly isn't something I recommend, because there's no guarantee a competing bid will emerge or, in this case, that American Financial Group's subsidiary will even keep its bid on the table. Following three hefty quarterly EPS misses in a row, I believe National Interstate shareholders should be fairly content with this offer.

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A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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