Homeowners Choice (HCI), a Florida property and casualty insurer, recently sold 8% senior notes. I bought some today as they are a great deal. Here are the details:
- Par Value is $25.
- Currently trade around $26.33.
- Quarterly dividend of $.50. At par value, they give a dividend of 8% annually.
- They are callable on 01/30/2016 at $25. They mature on 01/30/2020.
- They trade on NYSE under the symbol HCJ.
- At current interest rates, a great deal for a medium term bonds. In the worst case, they will mature in 7 years.
- HCI is highly profitable $200+ million company.
- HCI is not a multi billion dollar company.
- Business is concentrated in Florida. A big hurricane could have an effect on their financials even though they are safeguarded by reinsurance.
They offer a good risk/reward ratio. Here are the details of the security.
Disclosure: I own HCJ.