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I went on a podcast and spoke mostly about Fairfax. https://t.co/x7v5g2OvGf

All depends on temperament, time of life, desired return, etc. I don't know how old Modiva is, but when I was much younger, I would easily swing for the fences like that, because I didn't have as much money or had time to recover from such risk. But today at 55, comfortable and enjoying life, like you, I don't need to swing for the fences any more and I sleep really well. Although, I'm pretty sure if I see something just stupidly priced, like Fairfax or Meta was in the last few years, I will take huge positions again. And just like this time, I will reduce the positions as they rebound and maintain allocations that I'm comfortable with. I just live by my mantra for the last 10 years...never fall in love with any stock or investment. The goal is the best return you can generate while minimizing permanent loss risk to the portfolio. The portfolio is what you should love...not the components of the portfolio! Cheers!

@73 Reds I agree. Fairfax's other 'secret sauce' is not being restricted to bonds when investing. They are currently generating a return of better than 7.5% on their $70 billion investment portfolio. When you combine that with strong underwriting profit... well... +15% ROE is the result. The current fixed income yield of 4.7% is a game changer. As is a 15% return on equities.

Muddy: fair value marks are criminally high Viking: fair value marks are criminally low Does it confirm criminality?

1. When they have the cash to buyback the shares. My guess is when they sell some Digit. Likely years away. 2. They don’t have to but it’s nice to be able to buyback shares at market without paying a premium. 3. No reason why not. Many investors are afraid of a decline in earnings from the TRS in a given quarter but from a liquidity perspective it’s a pretty low risk. The stock would have to fall more than $500/sh to approach how much FFH makes in an average quarter. It’s a risk they can easily handle.

Inventory trading may well be a consideration, it would take some of the pressure off. You just know that Fairfax will have some angle that will be enlightening

In the event of Fairfax being added to the index, I wonder if the bank will keep many of the share for their own index or mutual funds.

1. Forced index buying is my bet 2. No, just not renew. However, when the contract closes, unless the bank wants to keep the position, they will sell it into the market. Unless there is an additional source of demand, this could put downward pressure on the share price, so in the month the contract ends, this could be quite costly to Fairfax. There is also the real possibility that a lot of investors are using the TRS as a proxy on IV and may choose to exit as well. Leverage works both ways. I would see this as a short term blip, but the market can react in pretty funky ways at time 3. Yes, but remember that this could be seen as a significant funding source for the buybacks to date.

@nwoodman, thanks for the update and attaching the files. They were very helpful. The Eurobank story just keep getting better and better - the management team at this bank is exceptional. ROTE of +15% looks likely for the foreseeable future (management guide and they are conservative). It will be very interesting to see if they bump capital return to 50% and what the allocation is to buybacks. My guess is if they can buy back stock below (or close to) tangible book value they are going to buy as many shares as they can get (and rightly so). And their profit growth profile is so strong any shares they take out moving forward will look like a steal in another couple of years. Eurobank has so many irons in the fire… Eurobank is Fairfax’s largest equity holding. It is poised to grow and deliver exceptional returns in the coming years. Poseidon also looks like it should grow earnings nicely moving forward. The FFH-TRS should continue to increase in value. If we ever see that Anchorage IPO, Fairfax India should see a nice pop in value. Fairfax’s largest equity holdings look very well positioned. This suggests a 15% return on the equity portfolio is not only possible but perhaps likely. PS: The fixed income portfolio currently has an average yield of 4.7%… The investment portfolio looks very well positioned.

Stelco – Rock Star Alan Kestenbaum / Reaping the Rewards of ‘New Fairfax’ With the closing of the sale of Stelco to Cleveland Cliffs in November 1, 2024, it is time to do a final long form post on this investment. Let's evaluate the performance of the management team at Fairfax. And see what else can we learn about Fairfax from this investment. ---------- On July 15, 2024, Stelco announced that the company had been sold to Cleveland-Cliffs for about C$70/share (consisting of C$60.00 in cash and 0.454 of a share of Cliffs common stock). Fairfax owned 13 million shares of Stelco. Total proceeds to Fairfax will be about US$639 million ($561 million in cash + $78 million in CLF shares). With the deal closing on November 1, 2024, Fairfax is expected to book an investment gain of $366 million (pre-tax) when it reports Q4, 2024 results. How has Fairfax’s investment in Stelco performed? (All amounts are in US$) I know… I know… Show me the money! In November 2018, Fairfax paid $193 million for 14.7% of Stelco (13 million shares at C$20.50/share). When Fairfax announced their Stelco purchase I hated it. At the time, it screamed ‘old Fairfax’ to me. Boy was I wrong. Fairfax’s return on its investment in Stelco has come from 3 sources: Gain on the increase in the value of Stelco shares …..…..…… $368 million Regular and special dividends paid by Stelco ……………………. $115 million Value of Cleveland Cliffs shares received as part of sale ……. $78 million Over its 6-year holding period, Fairfax earned a total return of about US$568 million (+294%) on its $193 million investment in Stelco. The 6-year CAGR is 25.5%. That is an outstanding return. Bottom line, the team at Fairfax/Hamblin Watsa absolutely crushed their investment in Stelco. What made Stelco such a good investment for Fairfax? The CEO of Stelco, Alan Kestenbaum. Since buying Stelco out of bankruptcy in 2017 (via Bedrock Industries) Kestenbaum's capital allocation decisions have been exceptional. Some examples: What did Stelco do with the earnings windfall from the historic bull market in steel in 2021 and 2022? They bought back 38% of shares outstanding. And they did not overpay. That was freaking brilliant. As a result of the significant buybacks Fairfax’s ownership in Stelco increased from 14.7% to 23.6% - with no new money invested. A significant amount was paid out to shareholders over the past 6 years in dividends (regular and special dividends). Two other brilliant moves by Kestenbaum: April 2020 - Minntac deal: at a cost of $100 million, Stelco got an 8-year supply agreement with US Steel with option to purchase 25% of Minntac (the largest iron ore mine in the US). Stelco struck this deal when Covid was raging - other CEO’s were in capital preservation mode and Kestenbaum was thinking long term value creation. At Fairfax’s annual general meeting in April 2023, Kestenbaum re-told the story of the incredible support he received from Prem/Fairfax in 2020 that allowed him to pull the trigger on this deal. June 2022: Stelco sold their real estate holdings in Hamilton (the Stelco Lands) for C$518 million. The timing of this sale was brilliant - at what might be close to the peak of Canada’s real estate bubble. And remember, Kestenbaum paid a total of about C$500 million for all of Stelco in 2017. And the final act? Selling the entire company for C$70.00 in July 2024. Kestenbaum has been schooling the North American steel industry on capital allocation and building shareholder value for the past 7 years. In short, Kestenbaum has been a rock star - even Billy Idol would agree. The incredible power of share buybacks (when done well) Over a 2 year period Stelco reduced shares outstanding by 38%. What is interesting is Fairfax has also been very aggressive, reducing their shares outstanding by 20.1% over the past 6.75 years. As a result, Fairfax shareholders got a double benefit - and they saw their per share ownership interest in Stelco increase substantially over the past 6 years as a result of two large buybacks. Importantly, both Stelco and Fairfax bought back their shares at very low prices. The result is incredible value creation for long term shareholders of Fairfax. How does Kestenbaum’s performance compare with Goncalves, CEO of Cleveland-Cliffs? Many investors hold Lourenco Goncalves, CEO of Cleveland Cliffs, in high regard for his capital allocation skills. In November 2018, Cleveland Cliffs shares traded at about $10/share. Today CLF trades at about $13/share. Since 2018, CLF has paid dividends of $0.38/share. Over the past 6 years, a shareholder in CLF has earned a total CAGR of 5% per year. Over the past 6 years, Kestenbaum has delivered to Stelco shareholders a CAGR of 25.5%. Kestenbaum’s strategic vision, execution, results and timing have been exceptional. Much better than Goncalves (and that is an understatement). As a result, over the past 6 years, shareholders of Stelco have done much, much better than shareholders of Cleveland-Cliffs. —————- Reaping the rewards of the 'new Fairfax' Stelco is a great example of what I like to call ‘new Fairfax.’ In about 2018, Fairfax (and the team at Hamblin Watsa) appeared to ‘tweak’ their value investing framework when it came to new equity purchases. As a result of these changes, Fairfax’s new equity purchases made since 2018 have performed very well. One of the important changes Fairfax made to their value investing framework was putting a much higher premium on partnering with great CEO/founders/owners. Stelco/Kestenbaum is a wonderful example of the incredible value creation that the changes made by Fairfax 6 years ago are now delivering to Fairfax shareholders. Importantly, Fairfax, via their many investments, is now partnered with many outstanding CEO’s/leaders/founders and the quality (in terms of earnings power) and prospects of their $20 billion equity portfolio has never looked better. Capital Allocation - Asset Sales Asset sales are a very important and underappreciated part of Fairfax’s capital allocation framework. It is something that separates Fairfax from both Berkshire Hathaway and Markel. Why sell an asset? Because someone values it much more than you do - and they are willing to pay you far more than it is worth. Selling Assets at Nosebleed High Prices Cleveland Cliffs paid consideration of C$70/share (cash and CLF shares) that was an 87% premium to Stelco’s closing share price of C$37.36 on July 12, 2024, and a 37% premium to Stelco’s 52-week high. In selling the company, Stelco (and Fairfax) were being highly opportunistic - they were able to take advantage of the consolidation fever that has gripped the North American steel industry in recent years. Fairfax did something similar twice in 2022: Insurance: Sold their pet insurance business for $1.3 billion, booking a surprising $1 billion gain after-tax. Pet assets were in a bubble (driven by a race to consolidate). At the time, no one even knew Fairfax had a pet insurance business. Non-insurance: Sold Resolute Forest Products at the top of the lumber cycle for a premium price of $626 million (plus $183 in million contingent value rights). At the same time, the sale resulted in the disposal of a chronically underperforming asset - which improved the overall quality of their remaining equity portfolio. As these three recent examples demonstrate, selling assets (insurance and non-insurance) can create significant value for long term shareholders. And improve the quality of the company. Fairfax detractors But talk to Fairfax detractors… my guess is they still view Fairfax’s purchase of Stelco as a shitty investment. They explain it away with ‘Fairfax got lucky.’ After all, Stelco is a commodity producer! It cracks me up when I hear the detractors talk about Fairfax’s equity holdings. They usually have no idea what they are talking about. But boy, do they ever have a lot of conviction when they express their views. =========== For those board members who are interested in going on a trip down memory lane, below are links to some of the important events in Stelco's life since Kestenbaum purchased the company out of bankruptcy in 2017. A short history of Fairfax’s investment in Stelco In November of 2018, Fairfax invested US$193 million in Stelco, buying 13 million shares at C$20.50. At the time, it was a deeply contrarian purchase. News release from Stelco announcing the company’s sale to Cleveland-Cliffs Cleveland-Cliffs to Acquire Stelco for C$70 per Share - July 15, 2024 https://investors.stelco.com/news/news-details/2024/Cleveland-Cliffs-to-Acquire-Stelco-for-C70-per-Share/default.aspx HAMILTON, Ontario--(BUSINESS WIRE)-- Stelco Holdings Inc. (TSX: STLC) (“Stelco” or the “Company”) is pleased to announce that it has entered into a definitive agreement (the “Arrangement Agreement”) with Cleveland-Cliffs Inc. (NYSE: CLF) (“Cliffs”), pursuant to which Cliffs has agreed to acquire all of the issued and outstanding common shares of Stelco (the “Transaction”) at a price of C$70.00 per share (the “Consideration”), consisting of C$60.00 in cash and 0.454 of a share of Cliffs common stock (equivalent to C$10.00 based on the closing price of Cliffs common stock on July 12, 2024) per Stelco share. The total enterprise value pursuant to the Transaction is approximately C$3.4 billion. The Consideration represents an 87% premium to Stelco’s closing share price of C$37.36 on July 12, 2024, and a 37% premium to Stelco’s 52-week high. Fairfax Financial Holdings, an affiliate of Lindsay Goldberg LLC, Alan Kestenbaum, and each of the other directors and executive officers of Stelco collectively holding approximately 45% of the current outstanding Stelco common shares have entered into support agreements to vote in favour of the Transaction, subject to customary exceptions. Comments from Prem about Stelco from Fairfax's 2023AR and 2022AR. 2023: "In a year of volatile steel prices, Stelco performed well, highlighting its competitive cost structure. Stelco’s talented team – led by Alan Kestenbaum, Sujit Sanyal, and Paul Scherzer – continues to be excellent stewards of the business with a keen focus on creating shareholder value. We believe that Stelco owns the best-in-class blast furnace assets in North America, which is highlighted by its industry leading margins. The company’s Lake Erie Works facility has had recent upgrades to its blast furnace, coke battery, a newly constructed co-generation facility and a new pig iron caster. Nippon recently announced an agreement to acquire US Steel at a multiple of 7.8x 2024 EBITDA, a significant premium to Stelco’s trading multiple. We believe the US Steel acquisition highlights the value of blast furnace operations. Stelco continues to have significant net cash on its balance sheet, providing management with flexibility to take advantage of both organic and inorganic growth opportunities. The company rewarded shareholders with a Cdn$3 per share special dividend in addition to its Cdn$1.68 per share regular dividend in 2023. Stelco has raised its regular dividend for 2024 to Cdn$2.00 per share. We believe Stelco has a bright future under Alan Kestenbaum’s leadership. Stelco is carried on our books at $22.44 per share versus a market price of $37.84 per share." Prem Watsa - Fairfax 2023AR 2022: “2022 was an active and successful year for Alan Kestenbaum and the talented team at Stelco. The company ended the year with its second-best fiscal result since going public despite an approximately 50% decline in steel prices over the summer. Stelco is benefiting from the Cdn$900 million it has invested in its Lake Erie Works mill since 2017, which has made the mill one of the lowest-cost operators in North America. Stelco entered 2022 with an extremely strong balance sheet and put its capital to good use, completing three substantial issuer bids during the year, thereby repurchasing approximately 29% of its outstanding shares. These repurchases have resulted in Fairfax’s ownership increasing to 24% from 17% at the beginning of the year. In addition to share repurchases, Stelco paid a Cdn$3 per share special dividend and increased its regular dividend to Cdn$1.68 per share from Cdn$1.20 per share. Stelco maintains over Cdn$700 million of net cash on its balance sheet and we anticipate that it will continue to be active both investing in its operations and efficiently returning excess capital to shareholders. We are excited to continue as a significant investor in Alan Kestenbaum’s leadership at Stelco.” Prem Watsa – Fairfax 2022AR Details of Stelco’s Hamilton land sale in 2022, for proceeds of $518 million. “Stelco Holdings Inc. (TSX: STLC) (“Stelco” or the “Company”) announced today that its wholly-owned subsidiary, Stelco Inc., has successfully closed a sale-leaseback transaction with an affiliate of Slate Asset Management (“Slate”). Stelco Inc. has sold the entirety of its interest in the approximately 800-acre parcel of land it occupies on the shores of Hamilton Harbour in Hamilton, Ontario to Slate for gross consideration of $518 million. In conjunction with the sale, Stelco Inc. has entered into a long-term lease arrangement for certain portions of the lands to continue its cokemaking and value-added steel finishing operations at its Hamilton Works site in Hamilton, Ontario.” https://www.thespec.com/news/hamilton-region/all-of-stelco-s-hamilton-land-sold-in-deal-that-would-see-it-transformed-into/article_17a333af-8198-5f97-9866-8c61ed8f799f.html? Details of Stelco’s agreement with US Steel in 2020 to securing long term supply for iron ore pellets. Stelco Announces Option To Acquire 25% Interest In Minntac, The Largest Iron Ore Mine In The United States, And Entry Into Long-Term Extension Of Pellet Supply Agreement With U.S. Steel “Stelco will pay US$100 million, in cash, to U.S. Steel in consideration for the Option (the "Initial Consideration"). The Initial Consideration is payable in five US$20 million installments, with the first installment paid upon closing of the Option Agreement and the remaining four installments payable every two months thereafter. Upon the exercise of the Option, Stelco would pay a net exercise price of US$500 million.” Transaction Highlights: Secures long-term future of Stelco's steel production and solidifies Stelco's low-cost advantage Provides supply of high-quality iron ore pellets from a well-understood and consistent source for the next eight years, or longer if the Option is exercised Increases annual pellet supply to level required for Stelco's higher production capacity following this year's blast furnace upgrade project Supports Stelco's tactical flexibility model to deliver highest margin outcomes based on prevailing market conditions Creates a secure pathway for Stelco to become a vertically integrated player in the future through ownership in a low-cost iron ore source which is the largest producing iron ore mine in the Mesabi iron range Structured in stages that will preserve Stelco's strong balance sheet and financial flexibility https://investors.stelco.com/news/news-details/2020/Stelco-Announces-Option-to-Acquire-25-Interest-in-Minntac-the-Largest-Iron-Ore-Mine-in-the-United-States-and-Entry-into-Long-Term-Extension-of-Pellet-Supply-Agreement-with-U.S.-Steel-04-20-2020/default.aspx Here is a little more information of Kestenbaum’s initial investment in Stelco in 2017. Purchase of Stelco out of bankruptcy: Bedrock gets steelmaker for less than $500 million https://www.thespec.com/business/stelco-deal-bedrock-gets-steelmaker-for-less-than-500-million/article_da943b70-1a93-5a35-acb4-92a6da05946a.html?

The stock trades very stupidly. Sells off good on earnings and then takes time to recover in time for next earnings. For the past few months, I've been selling puts and buying calls monthly. I also have a core position here too and don't mind if I get shares put on me.

I agree. I am a CPA and I kind of liked the challenge of taking those tests so I bought a CFA I study guide just for fun. I started going through it and somewhere around Sharpe’s Ratio I realized that the material was counterproductive.

I agree with you that most investors don’t spend the time to understand how the value is being built but that has nothing to do with if FFH will ever fully reflect its intrinsic value. Multiple expansion takes aggressive buyers and reluctant sellers. The buying is coming from the 60 index add and all of the Canadian active funds that are underweight which is value insensitive . Meanwhile, share buybacks and the TRS have cleaned up 7m shares since 2019 from the weakest (read value investor) hands. For those remaining, 2024 will be the fourth year with ROE north of 15%. I think anyone who has a rudimentary understanding of the business model can predict the next 4 years will also be north of 15% on average. If I’m right, the shareholders left will be reluctant sellers by the end of 8 years and the multiple could challenge something like Intact Financial at 3x BV despite recent poor returns. That’s why my plan to sell is based on forward returns and not valuation. Call me a reluctant seller.

Buffett’s ability to continue holding onto a stock is simply incredible to me. Even though he talks against market timing, it almost seems that he is incredibly good at it. I’ve read about how people consider him holding KO past the late 90s being a mistake, but I imagine this trait has done him far more good over the years than bad. I just don’t understand it. When does Buffett truly decide it’s time to sell?

@billybobjovialdechicoutimi Fight the good fight man. Those guys are total tools. Hopefully you prevail!

Fuzzy or hard to interpret financials and poor communication from management - seems like something to avoid. There are so many publicly traded real estate stocks. What do you like about this one? That of course doesn’t mean you shouldn’t ask questions. Thank you for sharing.

Well, days like Friday just don't come along often (if ever) and I have to admit that I am still somewhat in shock. I am just a little guy who doesn't profess to really know much stocks and essentially I just buy a few and rarely sell. My portfolio has just 19 stocks and Fairfax represents slightly over 50% of my holdings so a jump of 9% yesterday certainly made for a very good day. But my third largest holding after Fairfax and Royal Bank is Aecon Construction (ARE). Yesterday Aecon jumped 18.7%. Further contributing to a great day, were five of my other stocks that each gained in excess of 2% on a day when when the Toronto Stock Exchange was up less than half of one percent. So with a lot of good luck and much help from this board through the years, (Thank you all!!), I am up 46.25% so far in 2024. Fairfax is still looking pretty good and I have yet to sell a share since I made my initial purchase in 2007 at around $215. (Yes capital gains is going to kill me.) But what I don't understand is seeing board members share their portfolios here and notice some where Fairfax is not listed among their holdings. I mean not only does the name "Fairfax' appear in the very title of the board, but COBF must contain the most detailed and thorough examination of any company listed on the TSX. PS. In 2006 I had never bought a stock. But in looking for an investment, I stumbled on one of the predecessors of this board set up by Sanjeev. Followed it daily for about a year and by late 2007 jumped into Fairfax with both feet, so I owe a big, big Thank You to Sanjeev and fellow members here.

Yes, it is difficult to reconcile. That's something you might have to ask Investor Relations. I see the value of office as per chart above decline from $570M in 2022 to $518M in 2023. Around -9% or $52M. But in the annual report, it shows a FV decline of $27.5M Meanwhile industrial value went from $345M in 2022 to $440M in 2023. An increase of $95M. The property acquisition of $36M and $33M FV increase. There's still $26M unaccounted for. Is it possible they reclassified a property from office to industrial? Typically these assets are valued individually. Each property will have it's own assessment. The cap rates are essentially a summary of the inputs used. I'm sure the company has the details.

Typically REITs just cap NOI, here we see industrial NOI growing, hence higher asset values. But don’t take managements word for NAV cause it is fungible using different inputs.

I’m not a REIT expert. Occasionally things go up in value despite higher rates, but it is rare. I didn’t check your math, but it might be worth checking if management has incentive plans and what the targets are. It’s possible to boost the values a little bit here, a little there and a little over yonder and pretty soon the portfolio is worth a lot and maybe Wall Street will agree, the stock goes up and top management gets their payout. After all, who is to say a building is worth exactly “x” vs “x” plus or minus 10%? Especially over a 6-24 month period. There is also incentive misalignment with the appraisers. If they want to get hired for the next job, it is in their best interest to get close to management’s expectations lest they shop for a different appraiser. The same thing happened at the rating agencies during the GFC.

A bad day for the fans of share repurchases, but a nice day on the TSX60 waiting list, moving up 5 spots, passing 2 financials that are in the index (National Bank! and Sun Life), 1 financial that is in the list via Power Corp (Great-West Lifeco) and nipping at the heels of another, Intact.

I don't know if Ben is capable of doing 22% annualized returns long-term...that's Buffett territory. But I'm pretty sure he's capable of doing 13-15% annualized...and that's all investor's and Fairfax need. Only time will tell. Cheers!

No one outside of India, investing in India has better connections than Ben.

For me, one very interesting comment was that even if CAT 4 hit Tampa directly, Fairfax would still have an underwriting profit for the year. Another was that interest and dividend income are running at $2.5bn per annum, vs $2.2bn previously stated.

Post Q324 there is nothing to stop index arbs from running up FFH shares into the likely 60 add in December. Book value is growing 3-5% per quarter which makes it easy to own. The wild card is where investors let go of their shares. Based on the discussions on this board maybe we won’t see much multiple expansion but there is only one way to find out. I’ll be holding on to my shares regardless of multiple as long as BV keeps growing 10%+/yr.

Usually, historically Fairfax shareholders have often seen the company in a precarious or challenging situation when markets were rising and things calm...such as their short positions, poor turnarounds, etc. This is the first time in probably 20+ years that Fairfax is steadily making money just from bond and dividend income, and smooth insurance operations. Combine that with no dysfunction in their investment and associates portfolio, and FFH shareholders are having difficulty watching their company actually hitting ROE targets with ease and no encumbrances. They're just not used to this...this is Berkshire territory! Keep it up Prem! Cheers!

Another strategic shift Fairfax appears to be making is to build out the size of the non-insurance operating companies bucket. In 2022 they took out Recipe. They just added Sleep Country. And in Q4, with the takeout of Peak Achievement (Bauer) they will add one more. This could take pre-tax earnings for non-insurance operating companies from $150 million to perhaps $300 or $350 million per year - which now makes it a meaningful number. This income stream is different from the other 4 incomes streams Fairfax has: - It is not correlated with the insurance business/cycle - so provides important diversification to earnings. This benefits the income statement. - It also provides an important source of liquidity for the company - they are owned/controlled assets that could be sold if needed. This benefits the balance sheet. It will be interesting to see if Fairfax continues to grow the non-insurance consolidated companies bucket in the coming years.

There was podcast that Ben did on India that year or in 2022 that I thought it was really good. Macro stuff. And nothing "directionally" new, but I thought he presented the India opportunity much better than the FIH team. This is before he became FIH chair.

Prem is widening the investment team pool for the day when he and the old guard (Brian, Roger, Chandran, etc) aren't there anymore. As long as the new managers keep hitting average to good returns, the investment portfolio will provide reasonable gains. Cheers!

Reported earnings after the close. Another very solid quarter. $42.62 in per share earnings. 93.9% combined ratio, net written premiums up 2.8% before Gulf increase. $1033 3rd quarter end book value, up 11.7% YTD. $2 billion in cash at hold and another $2.1 billion in investments. Very strong balance sheet. FFH has now bought back 1 million shares this year at $1,112 average cost. 4.35% of the shares in 9 months. Net written premiums are now at $26 billion on a run rate basis. Run rate dividends and interest is now $50 per share. Run rate profits from affiliates is almost $25 per share. Run rate underwriting profit at 94% is $70 per share. All pre-tax #’s. Another strong performance by Prem and the team. We are currently selling for around 8 times annualized earnings and 121% of book. We likely get added to TSX 60 in next 12 months, if not in December. This is a great result and I continue to like this story very much. We are still in the early innings in my opinion. More good news to come over the next few years.

22% annualized over the last five years. Cheers!

This is a pretty interesting piece on hurricanes that occurred before recorded history and some of the ways scientists analyze their impacts. https://www.americanscientist.org/article/uncovering-prehistoric-hurricane-activity

As a long-term investor, I like the fact he is known as the blackberry/hedging guy. It has kept the stock price suppressed and allowed Prem the repurchase a significant amount of the company at a great price.

"2024 third quarter results, which will be announced after the close of markets on Thursday, October 31" https://www.fairfax.ca/press-releases/fairfax-announces-conference-call-2/

I think we can make some pretty good guesses on underwriting income, investment income and profit from some of the big holdings like Eurobank, Poseidon and the TRS for the next three years assuming no multiple expansion. Multiple expansion will only help the TRS. It also helps the company is buying back stock at these levels providing a floor for the multiple and that the 60 add is in front of us. If the multiple does expand, the excess capital will go from buying back stock to buying back the minority interests in the insurance subsidiaries. That could add another ~$25/sh in earnings. If there is a market correction or a widening of credit spreads that would also returns as capital could be allocated from treasuries to higher returning investments. Digit could also be sold down and reallocated to higher yielding investments (not necessarily higher returning). There is a lot of right tail optionality in the portfolio although we don’t know which levers they will pull and when.

Just did a sports weekend trifecta! Flew with my brother and cousin-in-law to San Francisco and caught 3 games: Lakers versus Golden State...while Lebron and Steph were there, they didn't play...last preseason game. Chiefs versus 49'ers...fantastic game...the pomp, pageantry and noise at an NFL game is unparalleled! San Jose versus the Colorado Avalanche...got to see McKinnon and Cale Makar live. Cheers!