Trisura Group: This TSX Stock Is up 500% in the Last 3 Years

Trisura Group is a company that has crushed the broader markets in the last three years. Will it continue to gain momentum after its stellar run?

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Trisura Group (TSX:TSU) is a Canada-based multinational specialty insurance service provider. This stock is a star performer that has had an incredible run over the past few years. Three years ago, each share of this company was trading merely at $6.8, whereas presently, the value has reached $43, indicating a massive 532% gain.

Trisura Group has a resilient business

Insurances companies must have a strong portfolio to back their performance. The better-quality portfolio that an insurance company has, the better its performance is. Trisura’s investment portfolio consists of high-quality, investment-grade bonds, preferred shares, alternative investments, and defensive, dividend-paying equities, which, despite facing such high market volatility, had performed brilliantly and helped the company sail through the pandemic with ease.

Moreover, the company’s management also played its part well and amplified its value by making conservative allocations to liquid investment-grade bonds as well as by performing strategic rebalancing through value opportunities in the market.

Trisura has changed its business approach

As per the words of the maestro Warren Buffett, the best investments are often boring, and that has been the case with the Trisura Group. Spun out of the giant Brookfield Asset Management, Trisura has always been a great performer. It has been among the top 10 performers on the TSX30 Index in the last three years.

Despite being in such a boring business, the company has crushed broader market returns on the back of interesting business strategies adopted by its management. However, things were different previously for Trisura, and before the 2020 market crash, Trisura was also growing at a relatively slower pace, much like its peers.

But post-pandemic, things changed when other stocks crashed, but Trisura shares started rallying. That was because the company had shifted to a more aggressive approach that contributed to most of its recent growth.

Solid financial performance

Trisura has been quite a good performer over the years. Even last year, despite troubled market conditions the company was able to successfully double its gross premiums to $926 million and increase its total revenues by a massive 56%. Moreover, it is in no mood to slow down its pace of growth. According to its second-quarter financials of this year, it had grown its premium and net income year over year by a whopping 79% and 156%, respectively.

Trisura Group has strong core operations and still has huge room to grow its business in the United States and Canada both organically and through strategic acquisitions. Due to this reason, the market expects this stock to remain bullish in the coming years as well. Besides, as its smaller in size, Trisura Group is easily able to outperform most of the bigger and established players in the insurance space. It is for these reasons that just within a period of mere three years, the stock was able to establish itself as an undisputed king in the insurance space and has gained more than 500% since then.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Brookfield Asset Management and TRISURA GROUP LTD. The Motley Fool recommends Brookfield Asset Management Inc. CL.A LV.

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