Value
9.7/10data confidence 67%| Component | Sub-score |
|---|---|
| P/E | 9.6 |
| P/S | 9.8 |
| Fwd P/E | 9.3 |
| PEG | 10.0 |
- ▸Forward P/E: 10.2x
- ▸PEG: 0.46
- ▸Attractively valued
GLRE · Why this verdict
Why Greenlight Reinsurance (GLRE) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.5/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Greenlight Reinsurance screens as attractively valued with a 54% margin of safety, per the engine's deep-value read. Bull case | The margin of safety should compress toward a more typical 20-30% range as the stock re-rates closer to intrinsic value. | →Stable |
| CounterA large margin of safety in an insurer can reflect the market correctly discounting for weak underwriting or investment results rather than a genuine mispricing. | ||
The engine explicitly flags 2 of 5 value-trap signals, declining revenue at -6.9% year over year and material insider selling of 11 sells totaling 0.27% of market cap, cautioning that the cheap valuation may not be a genuine opportunity. Bear case | Revenue growth should turn positive and insider selling should abate, clearing the value-trap signals. | →Stable |
| CounterValue-trap flags are heuristic and can trigger on temporary factors, such as planned executive diversification sales, rather than a durable deterioration. | ||
Insiders have sold a notable amount of stock, about $1.47 million or 0.271% of market cap, which the engine classifies as moderate-severity insider selling. Insider | Net insider activity should turn neutral or bullish, with no further material net selling, over the next reporting period. | →Stable |
| CounterInsider sales at a reinsurer are frequently routine diversification or tax-planning transactions rather than a signal about the business outlook. | ||
The company converts cash exceptionally well, at 340% of net income, even as revenue is declining roughly 7% year over year. Quality breakdown | FCF-to-net-income conversion should stay strong, well above 100%, even as the top line stabilizes. | →Stable |
| CounterStrong cash conversion during a revenue decline can reflect reserve releases or investment gains rather than sustainable operating cash generation. | ||
Greenlight Reinsurance screens as attractively valued with a 54% margin of safety, per the engine's deep-value read.
→StableBull case
- Expectation
- The margin of safety should compress toward a more typical 20-30% range as the stock re-rates closer to intrinsic value.
CounterA large margin of safety in an insurer can reflect the market correctly discounting for weak underwriting or investment results rather than a genuine mispricing.
The engine explicitly flags 2 of 5 value-trap signals, declining revenue at -6.9% year over year and material insider selling of 11 sells totaling 0.27% of market cap, cautioning that the cheap valuation may not be a genuine opportunity.
→StableBear case
- Expectation
- Revenue growth should turn positive and insider selling should abate, clearing the value-trap signals.
CounterValue-trap flags are heuristic and can trigger on temporary factors, such as planned executive diversification sales, rather than a durable deterioration.
Insiders have sold a notable amount of stock, about $1.47 million or 0.271% of market cap, which the engine classifies as moderate-severity insider selling.
→StableInsider
- Expectation
- Net insider activity should turn neutral or bullish, with no further material net selling, over the next reporting period.
CounterInsider sales at a reinsurer are frequently routine diversification or tax-planning transactions rather than a signal about the business outlook.
The company converts cash exceptionally well, at 340% of net income, even as revenue is declining roughly 7% year over year.
→StableQuality breakdown
- Expectation
- FCF-to-net-income conversion should stay strong, well above 100%, even as the top line stabilizes.
CounterStrong cash conversion during a revenue decline can reflect reserve releases or investment gains rather than sustainable operating cash generation.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Greenlight Reinsurance screens as deeply undervalued with strong cash conversion, but the engine flags 2 of 5 value-trap signals, declining revenue and material insider selling, that temper the deep-value case.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.8 |
| ROA | 1.6 |
| Gross margin | 0.0 |
| Op margin | 8.4 |
| Net margin | 5.7 |
| Current ratio | 5.6 |
| FCF quality | 10.0 |
| Moat | 4.6 |
| Piotroski F | 7.8 |
- ▸Excellent cash conversion: 340% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
3.6/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 0.8 |
| EPS growth | 6.4 |
- ▸Declining revenue: -7%
Momentum
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 8.2 |
| OBV | 10.0 |
| MA position | 7.0 |
| Volume | 4.8 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| erm sentiment | 5.0 |
Insider
3.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 5.0 |
- ▸Notable insider selling — $1,472,077 (0.272% of mkt cap)
Peer rank
4.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.0 |
| quality rank | 1.7 |
| growth rank | 1.7 |
- ▸Conservative debt levels
Technical
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.5 |
| support resistance | 0.9 |
| 52w position | 7.2 |
Risk (lower is worse)
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.3 |
| days to cover | 9.0 |
| volatility | 4.2 |
| implied vol | 0.0 |
| beta | 10.0 |
| debt equity | 10.0 |
- ▸High IV: 100%
- ▸Concentration risks: 3 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 5.6 |
| earnings timing | 5.0 |
| surprise avg | 3.5 |
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:7.1>=5.5
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:27d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (2)
- ASYMMETRY:UPSIDE_EXHAUSTED (upside=0.0%)
- INSIDER:0.27%=MODERATE
Reward-to-Risk
0.00
Upside
+0.0%
Downside
10.2%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeInst Constrain — Small cap ($0.5B) below institutional reach
SuitabilityAggressive — MCap $0.5B<$5B
Investment implication
The F-path SELL output reflects an overall score of 5.5 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 9.7) was not enough to lift the adjusted overall above the threshold. Current asymmetry R:R is 0.00 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 9.7, Momentum at 7.1, and Risk (lower is worse) at 7.1; the weakest are Technical at 3.2, Insider at 3.3, and Growth at 3.6. The V9 engine cleared all gates with 2 warnings, producing an asymmetric reward-to-risk of 0.00 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Deep Value Margin Of Safety
Trip ifMargin of safety compresses below 20%, down from the current 54%, as the valuation gap closes.
- P2Value Trap Signals Flagged
Trip ifThe count of triggered value-trap signals rises above 2 of 5, deepening the value-trap concern.
- P3Material Insider Selling
Trip ifNet insider selling exceeds 0.5% of market cap over the next 90 days, nearly double the current 0.271%.
- P4Strong Cash Conversion Despite Decline
Trip ifFCF-to-net-income ratio falls below 150%, down from the current 340%.