Summary: Insurance companies can be hard to understand. Brighthouse Financial, a newly spun off company, has attracted both bulls and bears in its short public career. Ranjit Thomas recently wrote a Seeking Alpha article expressing skepticism about famed value investor David Einhorn's position in the company wouldn't work, leading Einhorn to respond with a few comments. What is the story here and is there a way to grasp BHF's business model? We take a shot at it. Topics covered: 2:30 - Starting off - what does BHF do? 6:45 – The spin-off angle and the bull case for BHF 15:00 – Spelling out the bear case on BHF's and whether its model works 20:00 – Getting into the books for BHF 27:00 - The value of hedging your book at a insurance company 31:00 - Reviewing Einhorn's source idea and the underlying incentives in this story. 38:00 - Reaching conclusions and whether it's better to get into the weeds or avoid them.
