newtovalue

Thanks petec - you are correct. if we assume 0 for non operating earnings - we get net investments per share of $1500 usd - stock is still wildly undervalued. ty!

Hey guys - so I try to value FFH using the two column approach like Buffet suggests for BRK - and I get a really high number - so please tell me where I'm going wrong. General approach is as follows FFH Value = Net Investments Per share + 10x Insurance Earnings Shares Outstanding = 23,772,881 Assets - Listed Common Stocks $8.2BB (ATCO $1.8BB, EUROBANK $1.45BB, FIH/U $735MM etc...) - Digit $1.6BB - Cash $23.28BB - Bonds $14.09BB - Pref Stock $2.4BB Total Assets $39.7BB Liabilities - Borrowing $7.95BB - Pref Stock $2.41BB - Minority Interest $4.93BB Total Liabilities $4.93B Net Investments Per share = $1500 USD Insurance Earnings ~$250MM per yer (conservatively) --> 10x multiple = $2.5BB USD = $105 per share Total Value = $1500 + 105 = $1605 USD = ~$2000CAD Whats not included: - dont subtract out float - dont give any value to non-insurance subs that are not publicly listed (like CCM, others). Please tell me what I'm missing. Or if this model is correct - I should just load up on FFH here? ty!

Thanks for the comments glider! good point on not including goodwill owned by non controlling shareholders- never considered that. Ty!

One issue I have with looking at book value for Fairfax is the large goodwill they have ($6 billion usd) vs an equity book value of $16 billion. I still think Fairfax is cheap - but hard to find the comparison to make to Y or Brk as they don’t have such large goodwill balances.

Fairfax exercising most of its Atlas warrants https://www.newswire.ca/news-releases/fairfax-announces-intention-to-exercise-warrants-in-atlas-reinforcing-confidence-in-atlas-as-a-platform-for-growth-885095138.html

Fairfax acquires 5.4mm Fairfax India shares @ $12 US from existing shareholders! Buying FIH.U at 60% of a very tangible and hard book value - love this. https://www.fairfax.ca/news/press-releases/press-release-details/2022/Fairfax-Announces-Acquisition-of-Additional-Fairfax-India-Shares/default.aspx

Hi all! First off wanted to say thank you for all of the great discussion on this board. I have learned a lot just reading along and appreciate all the efforts you all give to this. Wondering if there has been any news on Digit? On the Q3 earning release - FFH stated they expected the common share placement to occur in the fourth quarter (i.e. by Dec 31) after which they recognize $1.1BB in additional book value gains. Was hoping they were able to sneak that into this year - as it will further push up book value. Has anyone heard anything with respect to this? - newtovalue

The amazing thing about that article is the list of other little deals Fairfax has done that I know nothing about! @Petec - agreed! I think this is part of the valuation challenge for FFH. As they have grown - they have acquired more and more investments which are hidden deep within the financial statements. Most investors (myself included) would not have a complete understanding of exactly what they own. Its at times like this I wonder if Fairfax would benefit from some providing its shareholders with a condensed view of their empire - similar to Buffett's 5 groves approach.

Picked up DISCK - still trading in the mid teens FCF, and now that their Debt is at a level with which they are comfortable, they will look to buyback more stock

new acquisition by FFH in Sri Lanka http://www.ft.lk/front-page/Fairfax-buys-10-7-JKH-stake-from-Khazanah-for-Rs-22-7-b/44-693402