NIB Holdings reviewed

Price at review $2.01 (ASX:NHF)

Most individuals have some form of health insurance. Like any insurance we hope we never have to call upon it but every year we pay up the premiums to cover ourselves partly driven by neccesity and partly because the government penalises you if you don’t. In our December 2012 quarterly report we review the operations and merits of listed health insurer NIB Holdings.

Since listing in November 2007 the business has performed strongly, led by CEO Mark Fitzgibbon and CFO Michelle McPherson. In turn the share price has responded, moving from its listing price of $0.85 to its current level of $2.01. In addition management and the board have presided over the return of capital to shareholders amounting to $75 million, special dividends totaling $23.3 million and bought back over $40 million in company shares.

We outline our thoughts on the business on why we think the business has more to offer despite the increasing regulatory issues now facing the industry and consumers in general. Management have steered a steady ship thus far and with an attractive 5% fully franked yield and a defendable business model NIB Holdings has been added to Selector’s Fund holdings.

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