Investment Thesis:
This stock is completely undervalued (0.6x book) due to fears over Puerto Rico which are overblown. BTIG model a sub $4 expected loss from the Puerto Rico situation and management are adamant the law is on their side. This pessimism leads to an opportunity for the discerning investor to buy a monopoly business in the municipal bond insurance space, who are buying back 10% + of stock a year at a significant discount to book value, are underwriting profitably in operations and whose investment income will rise around $100m for every 1% rise