Loews Corp. (L) reported a strong quarter, with net income up for the quarter and year-to-date (from $157 million to $278 million for the quarter, not far shy of doubling), observes Adrian Day, international expert and editor of Global Analyst.

Particularly strong was the contribution from its largest portfolio company, CNA Insurance, which saw earnings more than double, as it cuts insurance losses. The erstwhile troublesome long-term care division is in run-off mode, with no new policies issued since 2003. Over time it can reduce the reserves set aside for that business.

Boardwalk Pipelines and Loews Hotels also saw strong gains, though the former was only because Loews acquired all public shares of Boardwalk during the year to own 100% of the company. Loews continues to upgrade its older hotels and add new hotels in strategic locations.

Offsetting that, Diamond Offshore (the oil drilling company) saw income decline 21%, turning a modest profit last year into a loss in the quarter, as both activity and daily rates fell. The parent company’s investment portfolio also reported losses in the quarter.

The parent company has $3.2 billion in cash and investments, down from almost $5 billion after buying the Boardwalk shares it did not already own and buying back its own shares. Year to date, it has bought 5.5% of outstanding shares for over $900 million, continuing a history of strong buybacks.

Since the beginning of 2014, it has repurchased 74 million shares, as a cost of $3.2 billion. CEO James Tisch said buying Loews’ stock was “a great use of cash; we recognize the gift that the markets are giving us.” How much of a gift? Trading at 14 times earnings and yielding only half a percent, the real value is on an asset basis.

With a rock-solid balance sheet, the stock is trading at a better-than 20% discount to sum-of-the-parts, most of which is very transparent in cash and publicly listed shares. The strong buyback program lends some support to the stock. It’s a buy here, and a strong buy under $46.

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