S&P Proposes Looser Rules for Membership in Canada Stock Indexes
The suggested modifications are in response to 'observed trends' and market inquiries around its current policy, which requires companies to be legally based in Canada in order to be included in the TSX Composite and other stock gauges, according to a press release.
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This Ridiculously Cheap Warren Buffett Stock Could Make You Richer
Key Points Multinational insurance giant Chubb is one of the few stocks Berkshire Hathaway bought over the past two years. Its evergreen business model is well-insulated from the macro headwinds. It looks cheap relative to its long-term growth potential. 10 stocks we like better than Chubb › Over the past two years, Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) has sold a lot of shares from some of its top stock positions while boosting its cash holdings to record highs. That trend, along with the conglomerate's decision to pause buybacks of its own stock in 2024, suggested that in Warren Buffett's view, the market was getting overheated. Buffett has long advised investors to "be fearful when others are greedy," and there seems to be a lot of greed priced into the S&P 500 today -- it's trading at a historically high price-to-earnings ratio of 30. However, even as the broader market's valuations soared and Buffett became a net seller of stocks, he and his team still increased Berkshire's exposure to a few underappreciated companies. One of them was Chubb (NYSE: CB). Berkshire initiated a position in the American-Swiss insurance giant in the third quarter of 2023, and it continued to accumulate the stock in the first half of 2024. Today, that position is worth $7.4 billion, which gives it a 6.8% stake in the company and accounts for 2.5% of Berkshire's equity portfolio. Chubb isn't an exciting stock, but it's a cheap evergreen play that should continue growing in bull and bear markets. Let's see why it could make you richer over the long term. What does Chubb do? Chubb, which is based in Zurich, Switzerland, employs about 43,000 people and operates in 54 countries and territories. It's the world's largest publicly traded provider of property, supplemental, health, and casualty insurance policies. It was known as ACE Limited until 2016, when it acquired the original Chubb and adopted its brand as the name of the combined company. Big insurance companies are well insulated from macroeconomic headwinds because even when consumers and businesses need to cut their spending, they don't generally cancel their insurance policies. Chubb has also been growing rapidly outside of the U.S., where it generated 43% of its revenue in 2024. That's why Chubb's consolidated net premiums consistently increased over the past six years -- even as the COVID-19 pandemic, inflation, rising interest rates, geopolitical conflicts, trade wars, tariffs, and other macro headwinds rattled the global economy. Most of its revenue still comes from its core property and casualty (P&C) insurance policies. Metric 2019 2020 2021 2022 2023 2024 Consolidated net premiums growth 5.5% 4.8% 12% 10.3% 13.5% 8.7% Core operating income* per share growth 7.1% (27.7%) 7.8% 21.3% 48.5% (0.1%) Data source: Chubb Limited. *Net of tax. Chubb's combined P&C ratio -- which is calculated by adding its total claims (losses) to its expenses, dividing that total by its premiums earned, and multiplying that figure by 100 -- came in at 86.6% in 2024. An insurance company's P&C ratio must stay below 100% for its business to remain sustainable (since its paid claims shouldn't exceed its premiums earned), and Chubb's ratio remains far below the U.S. P&C insurer's industry average of 96.6%. That low ratio reflects Chubb's prudent approach toward insuring its customers and processing its claims. It has also been using more AI services to further streamline and automate that process. Chubb's core operating income per share dipped slightly in 2024, but that was only because the 2023 figure was boosted by a one-time tax benefit. From 2024 to 2027, analysts still expect its earnings per share (EPS) to grow at a compound annual rate of 8%. That's a solid growth rate for a stock that trades at 12 times earnings. It also pays a dividend with a forward yield of 1.4% at the current share price, and its low payout ratio of 16% gives it ample room for future hikes. How Chubb could make you richer over the long term Chubb stock won't generate huge gains in the next one or two years, but it should grow gradually. Assuming the company matches analysts' consensus estimates, continues to grow its EPS at a compound annual rate of about 8% from 2027 to 2035, and trades at a more generous 15 times forward earnings by the final year of that period, its stock price could nearly triple to more than $800 in a decade. That's probably why Buffett stayed bullish on Chubb even as he pruned many of Berkshire Hathaway's other stock positions. Should you invest $1,000 in Chubb right now? Before you buy stock in Chubb, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Chubb wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $654,781!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,076,588!* Now, it's worth noting Stock Advisor's total average return is 1,055% — a market-crushing outperformance compared to 183% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 18, 2025 Leo Sun has positions in Berkshire Hathaway. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy. This Ridiculously Cheap Warren Buffett Stock Could Make You Richer was originally published by The Motley Fool
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Analysis-US tech-stock stumble shows vulnerability in AI trade
By Lewis Krauskopf NEW YORK (Reuters) -U.S. technology shares are showing signs of vulnerability after a massive run, which has some investors pointing to overdone AI-driven gains while funds have taken steps to position away from the high-flying sector. Investors are looking to de-risk portfolios or lock in profits during a seasonally difficult period for stocks. Friday's looming speech by Federal Reserve Chair Jerome Powell at the annual Jackson Hole symposium is creating caution, investors said, with the potential for volatility if his comments fail to meet growing market expectations that the central bank is poised to cut interest rates. "When you have overcrowding and you have had such strong performance, it doesn't take much to see an unwind of that," said Keith Lerner, co-chief investment officer at Truist Advisory Services. "At the same time this week, everyone is waiting for the Fed, and there is repositioning ahead of that." The heavyweight S&P 500 tech sector fell sharply for a second consecutive session on Wednesday, putting its decline on the week at about 2.5%, while the tech-heavy Nasdaq Composite was off about 2% for the week. Shares of some highflyers, including Nvidia Corp and Palantir Technologies, were getting hit particularly hard. The pullback comes after a huge rally in which the tech sector soared over 50% through last week since the market's low for the year in April. That easily topped the 29% gain of the broader S&P 500 during that period and drove up valuations of tech stocks to lofty levels. Investors cited wariness about the artificial intelligence trade, which has been a key driver of tech stocks and the broader market as indexes have soared to record highs this year. Shares of Nvidia, the semiconductor giant that has symbolized the AI trade, have gained about 30% this year while shares of AI-focused data and analytics firm Palantir have roughly doubled year-to-date. Indeed, the tech sector's price-to-earnings ratio recently reached about 30 times expected earnings for the next 12 months, its highest level in a year, according to LSEG Datastream, while tech's share of the overall S&P 500's market value is nearly its highest since 2000. Recent cautionary signs included a study from researchers at the Massachusetts Institute of Technology that found that 95% of organizations are getting no return on AI investments, as well as comments by OpenAI CEO Sam Altman, who told tech news website the Verge last week that investors may be getting overexcited about AI. Since last week, some AI-linked shares have pulled back sharply: Nvidia has dropped about 5% while shares of Palantir have slumped some 16%. In Europe, stocks of so-called AI adopters have been under pressure over concerns over how powerful new AI models could disrupt the software sector. Still, some investors said, the caution is unlikely to be a sign that enthusiasm over AI is fizzling. 'These are price corrections," said Andrew Almeida, director of investments at financial planning network XYPN. "But if you look at the big picture, it's clear that more people will be investing more dollars in AI infrastructure. This is certainly not a 'reckoning' with the AI theme." JACKSON HOLE SEEN AS CRITICAL Investors also could be paring back their stock exposure during a traditionally rocky period for equities. August and September rank as the worst-performing months on average for the S&P 500 over the past 35 years, according to the Stock Trader's Almanac. "Valuations were stretched, these names have not taken a breather, and we're going into a tougher season for stocks," said King Lip, chief strategist at Baker Avenue Wealth Management. Other sectors such as consumer staples, healthcare and financials were up on the week, while relative strength for the equal-weight S&P 500 signaled to some investors a possible start of broadening of gains beyond the massive tech stocks that have led indexes higher. Powell's upcoming speech comes as Fed fund futures on Wednesday were indicating an 84% chance that the central bank will cut rates at its next meeting on September 16-17. Investors will be watching to see if Powell gives any indication that the central bank is on track for such a move or if he pushes back on the market's expectation for easing, which could spark volatility. Tech stocks tend to carry higher valuations which could make them sensitive to higher-than-expected interest rates going forward. "There are a lot of people who have overweighted tech, and it has worked for them," said Chuck Carlson, chief executive officer at Horizon Investment Services. "They don't want to get caught on the wrong side of that if in fact, the Fed doesn't do anything in September. So I think that is also causing (investors) to maybe not necessarily get out of tech, but to reduce the overweight a little bit." Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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Volkswagen's New Horsepower Subscription Sparks Outrage Among UK Drivers
Volkswagen has introduced a controversial subscription model in the United Kingdom, requiring customers to pay extra to unlock the full horsepower of its electric ID.3 vehicles, igniting backlash from drivers and industry observers. The German automaker's 'optional power upgrade' boosts the ID.3's horsepower from a standard 148 to 168, a 20-horsepower increase. Drivers can opt for a monthly fee of £16.50 (about $22.50), an annual payment of £165 (about $225), or a one-time lifetime subscription of £649 (about $878). The upgrade, which activates via a software switch, enhances engine performance without additional hardware, and remains tied to the vehicle even if it changes ownership. Horsepower, a unit measuring an engine's power and speed, equates to the energy needed to move 550 pounds one foot in one second. Volkswagen markets this feature as a flexible choice, allowing owners to enhance performance without a higher upfront cost. However, the move has drawn sharp criticism, with many viewing it as an attempt to monetize capabilities already built into the car. Consumer reactions have been heated, with some calling it a 'cash grab' and others questioning the ethics of locking performance behind a paywall. The subscription model follows a trend among automakers, including BMW and Mercedes-Benz, which have experimented with similar fees for features like heated seats or acceleration boosts. Volkswagen defends the approach, likening it to historical practices of offering varying engine potency at different price points. The controversy arrives as the automotive industry shifts toward software-defined vehicles, raising debates about transparency and value. Industry analysts suggest this could reshape consumer expectations, though Volkswagen has not yet indicated plans to expand the model beyond the UK. For now, the backlash underscores a growing tension between innovation and affordability in the electric vehicle market. ⚡️ Read the full article on Motorious
