SafetyinNumbers
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FIH has a bigger discount but FFH has more leverage. Margin of safety seems high on both.
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Fairfax India did an investor trip last week. My guess is that helped.
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That’s helpful thanks. I gave up my CPA for a reason! At least it’s just an intellectual exercise only and not an issue that we have to worry about with FFH/Eurobank.
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I was thinking a joint venture is like a partnership where there may be liability but an interest in a corporation would have limited liability i.e. non-recourse given the structure.
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Joint venture would be different than equity accounting wouldn’t it? I was trying to think of a scenario where a liability would be created in an equity accounting scenario.
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I believe a gain has to be recorded in that scenario effectively reflecting the bargain purchase.
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Fairfax includes its share of earnings from Eurobank based on its ~34% ownership so the carrying value goes up by that amount every quarter. The dividend moves from carrying value to cash but since it’s gone through earnings once it wouldn’t make sense to put it though earnings again. Does that make sense?
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Fairfax doesn’t have a lot of exposure to Canada. If there are big dislocations they could take advantage of them.
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The swaps have different counterparties and different expiries. The crosses are likely just technical in nature but need to be refreshed for legal/accounting reasons. I assume they are just internal crossed from one bank subsidiary to another bank subsidiary of the same bank.
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Today’s blocks look like them rolling the TRS. It happens every year since they put them on. There will be more over coming days is my assumption.
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Any colour on the blocks? Time, size and who the brokers were?
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FFH can only buy 9360 shares a day max unless they use the weekly block exemption. Yesterday there weren’t any meaningful blocks so it’s unlikely they bought more than the daily limit.
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No problem. Since the Investor Day, oil is up $6, CAD is down which means FCF is probably up to ~$1b from $700m all else being equal. Meanwhile, the stock is down today because it’s not in XEG/XIC yet.
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I think it’s just because it’s owned by value oriented investors who are worried about the market as a whole are trimming with no passive and quant inflows to offset it.
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Have you considered SCR.TO instead of OXY? The investor day presentation especially the first 48minutes is worth a watch. Adam Waterous is already a legend on Bay Street as a banker but well on his way to making it as a creator of great companies.
