StubbleJumper Posted August 2, 2018 Share Posted August 2, 2018 Not a bad day to own a third of RFP! Yep, it's nice to have days like this. I wish we would have more of them! SJ Link to comment Share on other sites More sharing options...
chrispy Posted August 12, 2018 Share Posted August 12, 2018 A nice write-up that mashs together the 2017 and 2018 COBF Fairfax threads: Fairfax Financial Offers Unique Exposure At Attractive Prices https://seekingalpha.com/article/4196979?source=ansh $FRFHF, $CIBEY, $EGFEY, $FFXDF, $FFXXF, $GRVVF Link to comment Share on other sites More sharing options...
John Hjorth Posted August 12, 2018 Share Posted August 12, 2018 Yes, indeed, a very nice FFH trailer/teaser/bird perspective write-up by Ben Comston, chrispy, Thank you for sharing it. Link to comment Share on other sites More sharing options...
Cigarbutt Posted August 12, 2018 Share Posted August 12, 2018 Thank you also. The report illustrates very well the valuation challenge (based on closely following the company for over twenty years) associated with a tendency for uncorrelated and lumpy results. Often the earning power appears to be underestimated by the market and looking for reversion to the mean (like now) but somehow, to jump in, one has to agree with or have full confidence in their "seer" capability, a topic that has been discussed in another FFH thread (Ericopoly and others) before. Link to comment Share on other sites More sharing options...
wondering Posted August 29, 2018 Author Share Posted August 29, 2018 https://www.fairfax.ca/news/press-releases/press-release-details/2018/Fairfax-Donating-US1-Million-for-Kerala-Flood-Relief/default.aspx Link to comment Share on other sites More sharing options...
wondering Posted September 4, 2018 Author Share Posted September 4, 2018 https://www.theglobeandmail.com/business/article-why-canadas-reputation-as-a-kids-tv-production-powerhouse-is-under/ Interesting article about Fairfax's investment in Boat Rocker Media and the Canadian childrens TV programming industry. Link to comment Share on other sites More sharing options...
wondering Posted September 11, 2018 Author Share Posted September 11, 2018 Interesting article about the excess capital in the reinsurance industry. "We find an asymmetric risk / reward as we move through 2018 windstorm season. We calculate ~$60bn of excess capital in the industry. We believe this surplus capital could result in limited pricing improvement even with a material loss; much like the pricing reaction to 2017 losses. We expect SCOR's shares to be most exposed should a hurricane emerge, given highest disclosed sensitivities and most risk to its buy-back." https://ftalphaville.ft.com/2018/09/11/1536679537000/When-the-wind-blows-your-money-away/ Link to comment Share on other sites More sharing options...
Cigarbutt Posted September 11, 2018 Share Posted September 11, 2018 Thank you wondering. That was useful. Here's a recent AMBest report that offers complementary info on different topics including the impact of the ILS market. http://www3.ambest.com/bestweek/DisplayBinary.aspx?TY=P&record_code=277679&URatingId=2855493 -most relevant pages of the document (3-9 and 34-39). As you likely know, Markel has been expanding in a big way into the ILS space whereas Fairfax hasn't. The cat-bond space appears to be a huge success, seemingly may have made the underwriting cycle irrelevant and people involved with transactions are getting comfortable, as most participants no longer require an independent rating agency opinion. However, in 2017, from adequate sources, the average coupon on the bonds is about 5% and average expected loss stands at 2,7%. Seems like an awfully thin margin but, so far, so good. Link to comment Share on other sites More sharing options...
valueinvesting101 Posted September 20, 2018 Share Posted September 20, 2018 https://www.fairfaxindia.ca/news/press-releases/press-release-details/2018/Fairfax-India-Announces-an-Agreement-With-Sanmar-Chemicals-Group/default.aspx As a result of this agreed transaction and positive operational developments at Sanmar, in the third quarter of 2018 Fairfax India will record investment gains of approximately $252 million (INR 18.3 billion), comprised of approximately $190 million (INR 13.8 billion) from common shares and approximately $62 million (INR 4.5 billion) from bonds, an increase in book value per share of approximately $1.62. Link to comment Share on other sites More sharing options...
gokou3 Posted September 20, 2018 Share Posted September 20, 2018 Thanks for sharing. Per 2018Q2 earnings PR, "At June 30, 2018 common shareholders' equity was $2,056.2 million, or $13.26 per share" So adding $1.62 to this would give $14.88, close to the current stock price. The INR currrency dropped by 5% since June 30, but since with the successful investments in Sanmar and Bangalore airport, i think I can have some confidence in the Indian team's ability to allocate capital. For this, I just initiated a long position. Link to comment Share on other sites More sharing options...
chrispy Posted September 21, 2018 Share Posted September 21, 2018 Great update. I think this gain will roughly equal the decrease in BV due to the rupee this quarter. Regardless of the short term currency fluctuations, it is a great sign. Link to comment Share on other sites More sharing options...
ourkid8 Posted September 25, 2018 Share Posted September 25, 2018 https://finance.yahoo.com/news/intention-normal-course-issuer-bid-113000070.html Under its existing normal course issuer bid, Fairfax has purchased 700,539 of its Subordinate Voting Shares, which included Subordinate Voting Shares reserved for share-based payment awards, through open market purchases on the TSX during the last twelve months at a weighted average price per share of Cdn.$667.29. Fairfax has not purchased any Preferred Shares under its existing normal course issuer bid. (Fairfax has spent $467,462,669.31 on share repurchases in the last year) Link to comment Share on other sites More sharing options...
Dazel Posted October 3, 2018 Share Posted October 3, 2018 Excellent buy back prices! While many do not pay attention to buy backs it is the secret math to a high share Price over the longer term. Fairfax has reached critical mass....and I believe will follow Singleton’s Teledyne model as long as we are cheap. Link to comment Share on other sites More sharing options...
LightWhale Posted October 3, 2018 Share Posted October 3, 2018 Eurobank's stock price plummeting https://www.bloomberg.com/news/articles/2018-10-03/greek-banks-said-to-promise-deep-cuts-to-pile-of-soured-debt Link to comment Share on other sites More sharing options...
chrispy Posted October 5, 2018 Share Posted October 5, 2018 "Seaspan, the world’s largest non-operating containership owner, has announced its first significant investment outside the sector, suggesting it intends to diversify its business model." https://gcaptain.com/seaspan-diversifies-as-it-steps-in-to-take-control-and-save-swiber/ Link to comment Share on other sites More sharing options...
FFHWatcher Posted October 8, 2018 Share Posted October 8, 2018 https://finance.yahoo.com/news/intention-normal-course-issuer-bid-113000070.html Under its existing normal course issuer bid, Fairfax has purchased 700,539 of its Subordinate Voting Shares, which included Subordinate Voting Shares reserved for share-based payment awards, through open market purchases on the TSX during the last twelve months at a weighted average price per share of Cdn.$667.29. Fairfax has not purchased any Preferred Shares under its existing normal course issuer bid. (Fairfax has spent $467,462,669.31 on share repurchases in the last year) I can't see that many share purchases on Sedi.ca. How else can FFH repurchase without reporting them on Sedi.ca ? Or am I not seeing them for a different reason? Link to comment Share on other sites More sharing options...
ourkid8 Posted October 17, 2018 Share Posted October 17, 2018 I am dying to find out if they got more aggressive in buying back their stock during this selloff. Earlier today, I just bought a large slug of stock at usd$501. (I couldn't help myself) I am very very pleased they repurchased close to half a billion in stock in the last year. I definitely was not expecting that!!! Excellent buy back prices! While many do not pay attention to buy backs it is the secret math to a high share Price over the longer term. Fairfax has reached critical mass....and I believe will follow Singleton’s Teledyne model as long as we are cheap. Link to comment Share on other sites More sharing options...
wondering Posted October 24, 2018 Author Share Posted October 24, 2018 https://www.theglobeandmail.com/business/article-fairfax-merging-sporting-life-and-golf-town-but-stores-will-still/ "The Toronto-based company says the two sporting goods retailers will operate separately with their own branding and management teams, but will make joint investments in technology, staffing and their supply chains." Link to comment Share on other sites More sharing options...
Dazel Posted October 25, 2018 Share Posted October 25, 2018 Buy every share you can Prem. Every last one! Link to comment Share on other sites More sharing options...
StubbleJumper Posted October 25, 2018 Share Posted October 25, 2018 Buy every share you can Prem. Every last one! Yes, I wonder how ffh views the current market. Their own shares look quite cheap, but I wonder whether they will find something else that's been beaten up even more. In any case, US$500m would buy back a considerable chunk of outstanding shares if the price would remain low enough for long enough. SJ Link to comment Share on other sites More sharing options...
ourkid8 Posted October 25, 2018 Share Posted October 25, 2018 I really like how businesses within the Fairfax umbrella are working together to reduce costs across their businesses. These investments are non material to Fairfax but it's great to see collaboration! https://www.theglobeandmail.com/business/article-fairfax-merging-sporting-life-and-golf-town-but-stores-will-still/ "The Toronto-based company says the two sporting goods retailers will operate separately with their own branding and management teams, but will make joint investments in technology, staffing and their supply chains." Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 25, 2018 Share Posted October 25, 2018 At this time next year, it's a pretty low bar for Fairfax to be generating $1+B in cash on its investment portfolio per annum. Very conservative assumptions of 2-3% on fixed income and 3-4% on equities gets you there. Barring a recession, Fairfax is going to roll it's bonds at higher yields and be pulling in something like $400M just in coupon income as long as the Fed keeps hiking rates. 10-12x investment earnings without considering insurance at all is pretty attractive. I would love to see another $500M in repurchases this year. Link to comment Share on other sites More sharing options...
petec Posted October 25, 2018 Share Posted October 25, 2018 Buy every share you can Prem. Every last one! Yes, I wonder how ffh views the current market. Their own shares look quite cheap, but I wonder whether they will find something else that's been beaten up even more. In any case, US$500m would buy back a considerable chunk of outstanding shares if the price would remain low enough for long enough. SJ The two aren’t mutually exclusive. Buybacks ought to be from earnings, not float. Float can be put to work. Link to comment Share on other sites More sharing options...
StubbleJumper Posted October 25, 2018 Share Posted October 25, 2018 Buy every share you can Prem. Every last one! Yes, I wonder how ffh views the current market. Their own shares look quite cheap, but I wonder whether they will find something else that's been beaten up even more. In any case, US$500m would buy back a considerable chunk of outstanding shares if the price would remain low enough for long enough. SJ The two aren’t mutually exclusive. Buybacks ought to be from earnings, not float. Float can be put to work. Most certainly they are not mutually exclusive. However, the decision of whether to buy back shares or acquire a new sub that might have been unfairly beaten up by the market over the past month is largely a question of current cash balances at the holdco level as well as subsidiary dividend capacity and the ability of the holdco to potentially borrow more. From my perspective, the holdco had somewhere between US$500m and US$1b of excess cash available at the end of Q2. Some of that might notionally have been earmarked to buyback minority positions, but that might have changed with the drawdown in markets. So, does FFH throw, say, US$750m of holdco cash at buybacks, or is there a new great sub out there somewhere that's been getting killed due to the market drawdown and the silly panic about the hurricanes which have already hit? Do they juice the divvies from the subs to enable either a larger buyback or an opportunistic acquisition? Or do they hold the line and just continue the Brit/Allied purchases? The question of what to do with float is a bit of a different question. My sense is that barring a drastic repricing of equities, FFH will likely hold the line on their strategy of holding short term fixed income. That current strategy provides an obvious operating income win over the next year or two while not overcommitting to an equity market which is still historically expensive. But, I guess time will tell. SJ Link to comment Share on other sites More sharing options...
petec Posted October 25, 2018 Share Posted October 25, 2018 Ah - I misunderstood. I thought you meant buybacks vs. buying equities, not buybacks vs. buying a new sub. My gut says no new subs - they’ve said they have the footprint they want and as you say they have minorities to buy in. Link to comment Share on other sites More sharing options...
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