Bilbo's quote: compliment or insult?

[dragongirlG]

I don't know half of you half as well as I should like, and I like less than half of you half as well as you deserve.

Would you consider this a compliment or insult?

Long ago I came to the conclusion that this was an insult to some of Bilbo's birthday guests, like the latter addressed to the Sackville-Bagginses. But now, let's anlayze this:

I don't know half of you half as well as I should like

I believe he means that he would like to know some hobbits better, but he can't. This is obviously a compliment, correct? Now, the next part:

and I like less than half of you half as well as you deserve.

When he says "half as well as you deserve" doesn't that mean he should like the "less than half" better? Now, if he had said "more than you deserve" he would mean that the less than half did not deserve to be liked, but he says "half as well," therefore meaning "I should like you better."

What are your opinions?