Hoodlum

Could there be Employee share purchases in Q4 that need to be accounted for?

I see the combined losses on Hurricane Milton and Helene was $304M. Less than what I expected and it would seem less than the industry as a whole based on prior hurricanes. It looks like our risk models are holding up well compared to the competition.

We did see some info on both of these previously but now we see the details of the transactions. It will be interesting to hear more about Blizzard Vacatia as that is a notable investment and at 50%, a significant share of the company. I wonder what the dividends would look like in Q1.

Maybe this is how they plan to slowly close off the TRS over time.

The Foreign Currency loss of $22/share was the surprise from Q4. Something we didn't account for and would have been difficult to determine.

For East US Hurrcicanes, Fairfax usually trends towards 1/3 of what BRK estimates. So based on the $1.3-$1.5B range estimate from BRK, I am estimating ~$450M. The gain from the Stelco sale would offset most of this. The Wildfires is more difficult to predict as the last comparable event for the industry and Fairfax was in 2018 and a lot has changed since then. I will say anywhere from $200-400M, but that could still be off.

I suspect some of this will be new to the analysts that are following Fairfax. The sale price of Peak could only be determined if they looked at Power Corp's financial. I am not sure how far they go with their analysis. The Milton Hurricane and Wildfire exposures will be interesting to see.

A great summary @Viking and covers most of my questions. Regarding the Bond duration, with the Q3/2023 call/results, Fairfax was very specific in what week they extended their duration which turned out to be the peak for long Treasury rates. I will listen to hear if they mention something similar related to the January peak, especially the longer 10 year Treasuries. This may have been discussed here already, but does the sale of the Eurobank shares in any way affect how their remaining Eurobank shares are reported/valued on their books.

Eurobank has completed the acquisition of Hellenic Bank shares that brings it ownership of Hellenic Bank to 93%. Eurobank has submitted the mandatory offer to remaining shareholders and then will exercise it's squeeze-out rights for any remaining shares. https://cyprus-mail.com/2025/02/11/eurobank-raises-stake-in-hellenic-bank-to-93-47-per-cent-eyes-full-control

Fairfax exchanged METLEN (Mytilineos) convertible bonds to acquire additional 2.5M shares. This increases Fairfax ownership from 4.68% to 6.43%. https://www.metlengroup.com/news/ase-announcements/insiders-announcements/announcement-of-regulated-information-fairfax-10-02-25/

yes, you definitely need to know when to take advantage of market valuation. We are a bit fortunate in that in the case of Stelco, steel peaked before Trump became president. I am just thinking that the AGT Foods Rail sale while not finalized yet, just snuck through before this trade dispute. The valuation today would be much less.

Do you have the details of the CIBC analysis that you could share.

This morning National Bank analyst upgraded Fairfax from $2400 to $2600. This is the 2nd upgrade in the past week from different analysts, likely anticipating excellent results from Q4 and 2024 as a whole. I am curious to see what we did for buybacks and extending bond durations over the past couple months.

Fairfax certainly had good timing with the Stelco sale.

Also, we still don’t know if Trump will pull back at the last minute. Anything is possible.

It looks like Amazon was the seller of the Quess shares https://www.devdiscourse.com/article/business/3248958-amazon-sells-stake-in-quess-corp-fairfax-boosts-holdings In a notable move within the business services sector, Amazon has sold a portion of its stake in Quess Corp. The global e-commerce leader offloaded 7.54 lakh shares, constituting a 0.50% stake, for Rs 46 crore through an open market deal. This transaction involved Amazon's investment arm, Amazon.com NV Investment Holdings, and was marked by shares being sold at an average price of Rs 610.20 apiece. The decision to divest comes as other significant stakeholders in Quess Corp, such as Fairfax Capital and Ajit Isaac, expanded their holdings. Fairfax Financial Holdings' unit, Fairbridge Capital (Mauritius), alongside Quess Corp's chairman Ajit Isaac, increased their stakes by purchasing an additional 3.77 lakh shares each.

Fairfax is acquiring more shares of Quess on the open market after the latest pullback of the stock price. The demerger of Quess into 3 tradeable companies is expected to be completed this year. https://www.business-standard.com/amp/markets/capital-market-news/quess-corp-shares-surge-following-promoter-share-purchase-125020100420_1.html Quess Corp climbed 4.86% to Rs 624.30, following the announcement of a share purchase by Fairbridge Capital (Mauritius), a promoter of the company. Fairbridge Capital (Mauritius), a subsidiary of Fairfax Financial Holdings, acquired 3,77,218 equity shares of Quess Corp, representing 0.25% of the company's paid-up capital. The purchase was executed through open market transactions on stock exchanges. As on December 2024, Fairbridge Capital Mauritius held 5,04,76,237 shares, or 33.95% stake in the company. Total promoter stake in the company stood at 56.57%

I found some comments in this interview regarding the impact on Tariffs. I believe the western Canadian agricultural companies have had experience dealing with Tariffs such as when China implemented it on Canola and India a few years ago on legumes. https://www.ckom.com/2025/01/27/listen-what-impact-will-tariffs-have-on-agt-foods-and-the-agriculture-industry/

CIBC analyst today increased their target from $2200 to $2400.

it has been known that Chubb was more exposed to the LA fires than others. We will see how Fairfax does.

Yes, that is what I interpreted from that as insurance/reinsurance will need to set this aside. I am already starting to see some analyst comments that mid-year policy renewal pricing could firm up ahead of the Hurricane season. Peak wildfire season is not until June/July. Further larger Cat losses between now and then will just further accentuate this. https://www.artemis.bm/news/reinsurance-capital-to-assume-at-least-30-of-total-insured-losses-from-la-wildfires-moodys/ Furthermore, Moody’s explained that the impact on reinsurance pricing from the wildfires “is difficult to determine at this point.” “We think the wildfires are likely to provide some support to property catastrophe pricing during the mid-year reinsurance renewal periods, as the wildfire losses could erode significant portions of annual catastrophe budgets prior to the 2025 Atlantic hurricane season.

It looks like there will be lots of opportunities for insurance as Ukraine rebuilds after the war. Fairfax will be able to take advantage of this. https://www.reinsurancene.ws/insurance-key-to-accelerate-investments-and-support-ukraines-recovery-doyle-sobolev/ During the discussion, Minister Sobolev emphasised the importance of insurance to help accelerate investments and support Ukraine’s economic recovery. He stated: “What we see is that the reconstruction for Ukraine needs hundreds of billions. We also know that there is not sufficient public money that’s going to cover this bill. So, a lot of the funding is going to have to come from the private sector. But a few steps need to be taken to attract that private sector. “For example, we calculated that for us to achieve sustainable growth until 2030 we need around $100 billion foreign direct investment (FDI). This FDI will not come without insurance on them, and insurance is something very particular.

Based on the reported results from Chub and RenRe, it looks like they are projecting LA Wldfire losses based off of a total insurance loss of $40-50B. It will be interesting to see how this has impacted Fairfax. This would also explain why Chubb is now so bullish for 2025. https://www.artemis.bm/news/renre-works-off-50bn-la-wildfire-industry-loss-chubb-also-appears-to-pick-a-high-figure/

Fairfax has acquired the 30% of FFH Ukraine, that it did not own, from EBRD. This is the continuation of buying out minority ownership of its subs. https://ukranews.com/en/news/1061195-ebrd-exits-from-arx-and-universalna-insurers

So, the final bids needs to be in by the end of February with the transaction expected to be completed likely late summer. I wonder if we will hear of any leaks regarding the bids, after they have been submitted.