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Dazel

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Everything posted by Dazel

  1. Someone can check but I am assuming that Digit is owned by the Fairfax Holding company? Their IPO was expected early this year and would add great deal of cash into the hold co. Depending in the IPO size. The serendipitous timing is that the coming IPO comes at a time when the Indian stock market is screaming higher. Ie the sales of Thomas Cook shares after a great year.
  2. https://markets.businessinsider.com/news/stocks/warren-buffett-most-gruesome-mistake-dexter-shoe-9-billion-error-2020-1-1028827359 Even Buffett makes mistakes…with the secured interest payments from BlackBerry over time the investment has become a rounding error. However, BlackBerry itself is one the stock markets great failures. Many followed Fairfax into Blackberry and had a horrible experience. That is why it is discussed it’s emotional. If anything it has been a deterrent on Fairfax stock price…unwarranted. BB is buy here probably…Fairfax needs it off the books. Dazel
  3. The bond portfolio is driving Fairfax as I have said for 20 years…Brian Bradstreet is the best Bond guy in the world! He is the bond king no one knows. Expect them to start buying long bonds soon if they have not done so already.
  4. Fairfax is positioned perfectly. They will continue to buy corporates and short term 1-5 year bonds….recession will fully hit…they will sell some short term bonds for profit-capital and buy long term bonds (barbell). It’s Brian Bradstreet’s time again. It’s the play book. They were one of the only ones on the planet to have the patience to have cash for this move… Prem and the Fairfax team have done a wonderful job and are getting rewarded in a hard market it does not get any better than that congratulations!!! “You make all your money in bear markets, you just don’t realize it at that time.” Shelby Davis Dazel.
  5. I think what is being missed is the fact that Fairfax has historically made capital gains in the bond portfolio over the last two decades rather than reach for yield and bring interest income. Because of this they were not looked at for the interest income that their size afforded (this is contrary to other insurance companies). Brian Bradstreet is the best bond guy in the world…in fact no one is close! I have said this repeatedly since 2003. In order to grow the insurance units they had to pay very close attention to capital levels. They defaulted to take the gain add capital=grow. Now that they have grown premiums from 2015-$8b, 2018-$15b, $28b today! The size of investment portfolio is now $49b. They were holding at least 30% to 50% cash for most of the last two decades except when Bradstreet made big bets usually on long term treasuries and corporates which made ridiculous gains. Markets did not like the lumpy interest income because it did not fit their spread sheets. Now they are in position to buy 3 year treasuries and have 4% income with little to zero risk…the rest of the industry does not have the cash they are stuck in huge hole from bond losses mark to market. This discipline will separate Fairfax in this cycle. They have been waiting for this…. We are in a hard market so the Subs need all the capital they can get to take advantage of it…when it softens and premiums come down they will dividend cash to the holding company.
  6. It seems like I have spent most of my time defending Prem and his team over the last number of years…No one is complaining and calling my “outlandish” price targets stupid anymore! I believe I spent time defending Prem and his family from a coup that said he was rolling up his ownership into India like the old Indian conglomerates! Lol. Can’t believe I had to do that! Remember SD? Anyways…very happy for those that believed and redemption for our friend Prem and his team. Fairfax has never been in better shape I guess that is why it is so quiet. Dazel
  7. I would like thank Prem Watsa and his team for all the hard work they do. Prem’s picture is going back up with the family on the mantle. Great leaders show up during tough times and Prem once again has used his brains and “brass balls” (see David Tepper) to bring Fairfax back from the depths of hell in 2020. congratulations on a great year Prem and team! Happy New year all! Dazel
  8. Teradyne in motion….. Prem joked about copying Harry Singleton…. time will tell but he may be headed this way!
  9. As I remember it…Fairfax will send out details but I believe this aligns with the sale of Odyssey Re. I am not a tax expert…so don’t take my word for it… I am of the camp that unless you get arbitrage come in Fairfax will “Not” get many shares tendered. They will use the left over proceeds for share buybacks in the open market as was mentioned earlier. off the top of my head Fairfax will have $2.5b cash at the holding company before the tender.
  10. Xerxes, Correct the financial analytics unit (TRI)They used the proceeds for a tender offer as Prem is doing. They continued to buy back stock afterward. it was a return of capital transaction.
  11. I think it is brilliant. Was involved in TRI (ThomsonReuters)tender offer a few years back (take a look for taxation) it’s was a great move…they sold their financial unit and bought back through tender offer and then normal course issuer bid. The stock has doubled since the transaction. I like being involved with smart people. Well done. I believe that TRI was a return of capital because of the sale of the financial unit and the Fairfax transaction is likely the same because of the Odyssey Re sale…like I said smart people are fun! a pleasure as always Prem!
  12. Fairfax is as cheap as I have ever seen it!
  13. Fairfax looks real good right here!!!
  14. Very possible that they get a second chance at the BB run..wake up Mr. Chen.
  15. no one pays attention to me and I that is understandable and likely prudent lol....but if I could see what was happening in the market short term...anyone could have...BB was being set up.they should have been aware. see my previous text here before it happened at $10... .split up strategic direction...earnings pre announcement would have to be issued to take advantage of the market would have squeezed this to $30 and they would have been able to issue shares when they popped...take advantage...at the market raise as Tesla has done. chen did not do it...he is asleep... it would have had to be quick...but if I saw it coming....Are they not paid to do this? Millions and millions? Sold BB at great profit and hope Fairfax could synthetically do so as I discussed... Back to buying SNC as Prem should be.
  16. BB up 20% Premarket...in my opinion if this heads towards where the others have AMC and GME...you will see FFH synthetically hedge their position they are too smart to kill the rally and hurt their positions value. Remember a large part of their position is convertibles. Fairfax and Blackberry should come forward with any discussions of reorganization-split up or sale discussions of the patent-royalty portfolio so there is nothing that can hold them back with regards to material information. Allowing all involved to be able to hedge or sell into a parabolic move.
  17. Fairfax did not sell at these levels March 1 when their restrictions came off. The checking 10x certainly was to find out what their options were pardon the pun! They would have hedged their position for sure if they could have...we know how much they utilize swaps even with their own stock. If we do head back to $20 that’s is what they will do... I am going to post on the Blackberry forum but my thesis is it is time right now for Fairfax-Blackberry to take advantage of this market. Split Blackberry up now...while the market is looking at them. It will create several possible scenarios into a market that WANTS to like Blackberry.
  18. Great results... The corporates I kept mentioning...$500m gain. Happy they cut their losses on the mystery short....$500m loss.....ouch. Absolutely pumped about the total return swap of the buyback!!!! Love what they are doing... Quarter one will also be a blow out....we are headed to records. Prem is back.
  19. IFC results were impressive and it is trading at almost 3x book value.....Fairfax has work to do!
  20. I don’t pretend to be an expert in growth companies quite the opposite. Farmers edge subscriber growth Is very impressive....and the market is paying for growth...NOT VALUE. May be we are the ones that have growth wrong?!!! Because growth has been getting investors to pay up for well over a decade. Fairfax and Farmers edge are giving the market what they want. Disruptive technology....
  21. Do you guys think that Berkshire will return their profits from Snowflake? Let’s go!!
  22. Short volumes....would fit a Fairfax hedge.
  23. I agree with Viking. I miss the days when Prem and Fairfax were simple. They likely shorted AMC, GME, Nok, Pltr, as hedge and got killed for awhile....as a hedge. They can’t know what BB is worth over X...it was not worth $28 USD at this time....maybe the future...reaction you sell it as Wade Burton did. It’s why I recommended SNC for them to buy...it’s now a service business which is quantifiable...not sexy but good returns...and you would not buy it without the 407 and royalty assets. Simple A+B =C/ future cash flow...how is that price compared to the market price. SNC trades at about 2X...their competitors trade at 15 to 20. Yep simple it’s a buy. Blackberry cash flow? I understand A +B (royalties like SNC)=C/ future cash flow...trade at 100X SNC... The answer is simple selll BB and buy SNC or X....everything else is emotion unless you think you can change that future cash flow number to bring the 100X closer to X or SNC. The future return probabilities of the two stocks in a value world are UNMIStAKAbLE...you could use the same comparison for Atlas but more importantly to me Fairfax. Keep the money in Blackberry at $25USD or buy back Fairfax shares with the proceeds? Simple answer. It’s likely the same answer at $11....and the market thinks Prem missed it (Fairfax shares dropped like a stone) so I guess that is what we have...time to move on.
  24. Doc75, You may be correct....I did a lot of digging after your post. It’s how you interpret the ruling. The swap that Fairfax bought was for all intensive purposes a “substitute” for common shares. Which effectively would give them economic Benefit the same as common shares except they do not get voting rights or the shares as they have to be exercised for cash and cannot be redeemed for shares. The derivative meanings in early warning reports are different for lenders etc...and to be very honest I don’t know as I am not lawyer. Lending shares and short sales are very grey in their interpretation in what has to be important. Hedging does not appear very often...in fact I have never seen it show up in an early warning report. The SEC certainly does not have it with their 13d disclosure. Stan drukenmiller would have lawyers working 24 hours a day.... The rules are made for take overs and that is why they are early warning...so the design is not let someone sneakily take control of a company and screw the minority shareholders because they do not have the votes....hedging is NOT part of this. But you are correct a swap contract was not likely used. Short sales can be performed without disclosure for number of days I think 3....as long as they are covered. Fairfax could have done this a number of times....there was a lot of action and volume to be able to do this...but as far as disclosure...they could have got around it...
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