Buckeye Posted January 21 Posted January 21 3 hours ago, Jaygo said: I largely agree intuitively but in reality you and I are wrong. it is really important to try and look at life / relationships / investing etc through other peoples eyes. I personally think most of the recipe resto's are pure shit but they do attract a certain clientele and I think there is a lot of juice to squeeze out of the boomers. I think many young like yourself don't realize how much money is sitting in accounts of the boomers who may be too weary to travel, to weak to ski and for whom going out to a restaurant is the most exciting thing they can do. They want something brightly lit ( bad eyes ) not too much character ( not cool and definitely not noisy ), reliable taste ( bland ) and the recipe banner fits this perfectly. I think they will get a decent return on recipe and once the category ages out completely they can wind down what's not working or sell it to PE I agree with this take. Total anecdata, but we have an Olive Garden near our house (located near a major highway) and my wife and I laugh/joke every time we drive by because the parking lot is ALWAYS FULL! It can be a snowy blizzard, on a Sunday evening, and the parking lot is full! And we live in a fairly food-forward city. We went there a few years ago with my parents and their boomer friends and the food was indeed pretty bad. But you do get unlimited free breadsticks and salad!
Duke In Shadows Posted January 21 Posted January 21 (edited) 4 hours ago, Jaygo said: I largely agree intuitively but in reality you and I are wrong. it is really important to try and look at life / relationships / investing etc through other peoples eyes. I personally think most of the recipe resto's are pure shit but they do attract a certain clientele and I think there is a lot of juice to squeeze out of the boomers. I think many young like yourself don't realize how much money is sitting in accounts of the boomers who may be too weary to travel, to weak to ski and for whom going out to a restaurant is the most exciting thing they can do. They want something brightly lit ( bad eyes ) not too much character ( not cool and definitely not noisy ), reliable taste ( bland ) and the recipe banner fits this perfectly. I think they will get a decent return on recipe and once the category ages out completely they can wind down what's not working or sell it to PE I’m aware of the spending power of the boomers. I’m simply saying that a strategy built around squeezing as much as possible out of that cohort over the next decade, and then trying to exit a set of declining businesses, is not good investing. They’ve recently done M&A into younger brands, like Fresh Kitchens, and in many people's view, have managed to damage what made the brand appealing in the first place (which is part of my broader displeasure with the company). Nevertheless, M&A will have to be part of their future strategy as the legacy brands continue to decline. I’m sure the take private was underwritten attractively and will produce a decent ROE. Just clearly better uses of capital than doubling down on a business model facing secular decline. Example is no one wants to be in the toy business today. Fifteen years ago, everyone did, it was considered “recession-proof.” Fairfax made a poor capital allocation decision with Toys “R” Us, saving it, holding it for three years, and ultimately selling it at a 60% loss. I think Recipe has similarly poor prospects. Edited January 21 by Duke In Shadows
Viking Posted January 21 Posted January 21 10 minutes ago, Duke In Shadows said: I’m aware of the spending power of the boomers. I’m simply saying that a strategy built around squeezing as much as possible out of that cohort over the next decade, and then trying to exit a set of declining businesses, is not good investing. They’ve recently done M&A into younger brands, like Fresh Kitchens, and in many people's view, have managed to damage what made the brand appealing in the first place (which is part of my broader displeasure with the company). Nevertheless, M&A will have to be part of their future strategy as the legacy brands continue to decline. I’m sure the take private was underwritten attractively and will produce a decent ROE. Just clearly better uses of capital than doubling down on a business model facing secular decline. Example is no one wants to be in the toy business today. Fifteen years ago, everyone did, it was considered “recession-proof.” Fairfax made a poor capital allocation decision with Toys “R” Us, saving it, holding it for three years, and ultimately selling it at a 60% loss. I think Recipe has similarly poor prospects. Fairfax bought Toys “R” Us to be in the toy business? My understanding is it was bought for the real estate. When you say “ultimately selling it at a 60% loss” does this include the real estate? 1
Masterofnone Posted January 21 Posted January 21 Dunno. The evidence points toward the majority of the Canadian and US populous being perfectly happy with shitty food. Just look at the options on your next long road trip. Subway for Christ sake.... If you actually like good food, it is pretty easy to assume others should too, but the freezer-> microwave->plate model seems to suit a whole lot of people.
Jaygo Posted January 21 Posted January 21 1 hour ago, villainx said: That's too mean! Unless you are talking about someone else. I'm really not trying to be cruel. I just see what I see. My own mum and her friends are the case in point. They go to Kelsey's twice a week. She is on the older side of a boomer so i'm not trying to lump everyone in here, but the fact is we will all get to a point where a nice lunch out is the highlight of our week. Some will hold off longer than others but the time for travel will end and the time for pickleball and golf will end too.
villainx Posted January 21 Posted January 21 2 hours ago, Jaygo said: get to a point where a nice lunch out is the highlight of our week. Some will hold off longer than others but the time for travel will end and the time for pickleball and golf will end too. The future you paint is BLEAK. =P
gfp Posted January 21 Posted January 21 haha - I definitely know some people in their 80s where the rare steak salad at their favorite lunch spot is by far the highlight of their week!
anshulp Posted January 22 Posted January 22 Tim Eriksen released his Q4 letter today. He made Exco 8.4% of his fund. If I remember correctly Fairfax owns 49% of the company marked at $20.01 (just about where we are at today). Posting his comments: During the quarter we added a new major expert market position, Exco Resources (expert: EXCE). We have followed the company for a number of years and previously owned shares in 2021. Exco is an independent oil and gas company focused on onshore US shale development and production. Their primary areas of focus are Haynesville and Bossier shale in east Texas and north Louisiana, Eagle Ford shale in south Texas, and Marcellus and Utica shales in Appalachia. Exco went through a restructuring and emerged from Chapter 11 in 2019. Exco has performed very well since then (see stock chart to the right). Production is nearly 90% natural gas. At the end of 2020 Exco had just over $560 million of equity ($11 per share based on 51 million shares). Fast forward to September 2025 and Exco had equity of nearly $1.1 billion ($23 per share based on roughly 46 million shares). Mark-tomarket gains and losses on derivatives (hedging) make their earnings swing wildly. We ignore most of that and focus on operating income and cash flow. What caught our attention was their increased production the last three quarters - from 22 Bcfe (billion cubic feet equivalent) in the March quarter, rising to 27 Bcfe in June, and then to nearly 36 Bcfe in September. Additionally, in December they announced a $430 million capex budget for 2026 compared to a ~$185 million budget for 2025. We don’t think you have to be an expert on future natural gas prices or well flow rates to like the setup. With production set to increase and having a proven track record of hedging successfully, we are quite optimistic. If natural gas goes to $2 per mcf, Exco is near breakeven, but will have about $4 per share in cash flow. Assuming a 10% increase in production and pricing of $3 per mcf we think they can earn about $3 per share (and have $7 per share in cash flow), and at $4 per mcf they would push $6 per share (and have total cash flow of about $10 per share) in comparison to its current $19 per share price. As we write this, current two year strip pricing averages about $3.75 per mcf. Hopefully we are underestimating their potential production increase. Lastly as of the end of 2024 reserves were 28 times production. Admittedly, 75% of reserves were undeveloped, but that is still quite impressive. Their PV-10, which is the estimated present value of Exco’s future after tax cash flows discounted back at a 10% rate, was nearly $40 per share. Natural gas pricing outlook is more favorable today than it was at the end of 2024. Obviously, they would be an attractive acquisition candidate. Link to his letter (guy is a beast btw) : https://static1.squarespace.com/static/5ea6570a0ba57d406203e048/t/6971662dea3ab16d2ec514e0/1769039405165/Q4+2025+Results+for+Cedar+Creek+Partners.pdf
Duke In Shadows Posted January 22 Posted January 22 (edited) 8 hours ago, Viking said: Fairfax bought Toys “R” Us to be in the toy business? My understanding is it was bought for the real estate. When you say “ultimately selling it at a 60% loss” does this include the real estate? FFH bought TRU for $300M in 2018, and sold the business along with some of the RE in 2021 for $90M. Based on personal conversations, my understanding is FFH still owns some of the real estate but not all. Hard to know precisely. So I guess 60% loss isn't entirely fair...perhaps 40%? either way not great. below from the 2021 annual. also in the globe today. https://www.theglobeandmail.com/business/article-toys-r-us-locations-closing-unpaid-rent/ Edited January 22 by Duke In Shadows
Viking Posted January 22 Posted January 22 20 minutes ago, Duke In Shadows said: FFH bought TRU for $300M in 2018, and sold the business along with some of the RE in 2021 for $90M. Based on personal conversations, my understanding is FFH still owns some of the real estate but not all. Hard to know precisely. So I guess 60% loss isn't entirely fair...perhaps 40%? either way not great. below from the 2021 annual. also in the globe today. https://www.theglobeandmail.com/business/article-toys-r-us-locations-closing-unpaid-rent/ I agree the Toys R Us retail business was terrible. The fact they got rid of it is a positive in my book. But not knowing what the value of the real estate is… I give this transaction a grade of incomplete.
SafetyinNumbers Posted January 22 Posted January 22 3 minutes ago, Viking said: I agree the Toys R Us retail business was terrible. The fact they got rid of it is a positive in my book. But not knowing what the value of the real estate is… I give this transaction a grade of incomplete. Given how conservative they are, if they booked a gain it was probably a success.
Hoodlum Posted January 22 Posted January 22 1 hour ago, anshulp said: Tim Eriksen released his Q4 letter today. He made Exco 8.4% of his fund. If I remember correctly Fairfax owns 49% of the company marked at $20.01 (just about where we are at today). Posting his comments: During the quarter we added a new major expert market position, Exco Resources (expert: EXCE). We have followed the company for a number of years and previously owned shares in 2021. Exco is an independent oil and gas company focused on onshore US shale development and production. Their primary areas of focus are Haynesville and Bossier shale in east Texas and north Louisiana, Eagle Ford shale in south Texas, and Marcellus and Utica shales in Appalachia. Exco went through a restructuring and emerged from Chapter 11 in 2019. Exco has performed very well since then (see stock chart to the right). Production is nearly 90% natural gas. At the end of 2020 Exco had just over $560 million of equity ($11 per share based on 51 million shares). Fast forward to September 2025 and Exco had equity of nearly $1.1 billion ($23 per share based on roughly 46 million shares). Mark-tomarket gains and losses on derivatives (hedging) make their earnings swing wildly. We ignore most of that and focus on operating income and cash flow. What caught our attention was their increased production the last three quarters - from 22 Bcfe (billion cubic feet equivalent) in the March quarter, rising to 27 Bcfe in June, and then to nearly 36 Bcfe in September. Additionally, in December they announced a $430 million capex budget for 2026 compared to a ~$185 million budget for 2025. We don’t think you have to be an expert on future natural gas prices or well flow rates to like the setup. With production set to increase and having a proven track record of hedging successfully, we are quite optimistic. If natural gas goes to $2 per mcf, Exco is near breakeven, but will have about $4 per share in cash flow. Assuming a 10% increase in production and pricing of $3 per mcf we think they can earn about $3 per share (and have $7 per share in cash flow), and at $4 per mcf they would push $6 per share (and have total cash flow of about $10 per share) in comparison to its current $19 per share price. As we write this, current two year strip pricing averages about $3.75 per mcf. Hopefully we are underestimating their potential production increase. Lastly as of the end of 2024 reserves were 28 times production. Admittedly, 75% of reserves were undeveloped, but that is still quite impressive. Their PV-10, which is the estimated present value of Exco’s future after tax cash flows discounted back at a 10% rate, was nearly $40 per share. Natural gas pricing outlook is more favorable today than it was at the end of 2024. Obviously, they would be an attractive acquisition candidate. Link to his letter (guy is a beast btw) : https://static1.squarespace.com/static/5ea6570a0ba57d406203e048/t/6971662dea3ab16d2ec514e0/1769039405165/Q4+2025+Results+for+Cedar+Creek+Partners.pdf Thanks @anshulp for sharing this. I’ll be the first to admit that I do not know how to value these businesses. But we have seen from minerals that pricing is cyclical for resources and it looking like the opportunity for natural gas is improving. Fairfax may have something of value in Exco at some point.
SafetyinNumbers Posted January 22 Posted January 22 1 hour ago, anshulp said: Tim Eriksen released his Q4 letter today. He made Exco 8.4% of his fund. If I remember correctly Fairfax owns 49% of the company marked at $20.01 (just about where we are at today). Posting his comments: During the quarter we added a new major expert market position, Exco Resources (expert: EXCE). We have followed the company for a number of years and previously owned shares in 2021. Exco is an independent oil and gas company focused on onshore US shale development and production. Their primary areas of focus are Haynesville and Bossier shale in east Texas and north Louisiana, Eagle Ford shale in south Texas, and Marcellus and Utica shales in Appalachia. Exco went through a restructuring and emerged from Chapter 11 in 2019. Exco has performed very well since then (see stock chart to the right). Production is nearly 90% natural gas. At the end of 2020 Exco had just over $560 million of equity ($11 per share based on 51 million shares). Fast forward to September 2025 and Exco had equity of nearly $1.1 billion ($23 per share based on roughly 46 million shares). Mark-tomarket gains and losses on derivatives (hedging) make their earnings swing wildly. We ignore most of that and focus on operating income and cash flow. What caught our attention was their increased production the last three quarters - from 22 Bcfe (billion cubic feet equivalent) in the March quarter, rising to 27 Bcfe in June, and then to nearly 36 Bcfe in September. Additionally, in December they announced a $430 million capex budget for 2026 compared to a ~$185 million budget for 2025. We don’t think you have to be an expert on future natural gas prices or well flow rates to like the setup. With production set to increase and having a proven track record of hedging successfully, we are quite optimistic. If natural gas goes to $2 per mcf, Exco is near breakeven, but will have about $4 per share in cash flow. Assuming a 10% increase in production and pricing of $3 per mcf we think they can earn about $3 per share (and have $7 per share in cash flow), and at $4 per mcf they would push $6 per share (and have total cash flow of about $10 per share) in comparison to its current $19 per share price. As we write this, current two year strip pricing averages about $3.75 per mcf. Hopefully we are underestimating their potential production increase. Lastly as of the end of 2024 reserves were 28 times production. Admittedly, 75% of reserves were undeveloped, but that is still quite impressive. Their PV-10, which is the estimated present value of Exco’s future after tax cash flows discounted back at a 10% rate, was nearly $40 per share. Natural gas pricing outlook is more favorable today than it was at the end of 2024. Obviously, they would be an attractive acquisition candidate. Link to his letter (guy is a beast btw) : https://static1.squarespace.com/static/5ea6570a0ba57d406203e048/t/6971662dea3ab16d2ec514e0/1769039405165/Q4+2025+Results+for+Cedar+Creek+Partners.pdf Nice find. I was just thinking about EXCO today. That is a nice boost to ROE if it reports strong earnings as its equity accounted.
dartmonkey Posted January 22 Posted January 22 3 minutes ago, SafetyinNumbers said: 7 minutes ago, Viking said: I agree the Toys R Us retail business was terrible. The fact they got rid of it is a positive in my book. But not knowing what the value of the real estate is… I give this transaction a grade of incomplete. Given how conservative they are, if they booked a gain it was probably a success. Given the fact that we don’t know how much real estate they kept nor what percentage of revenues nor for how long they expected to collect those revenues, it is impossible to say, but if Fairfax said they bought it for $237m in 2018 and sold it in 2021 for $90m while booking gains of $86m at that time, it seems the value of what they retained was $237m+$90m-$86m=$241m. A $86m gain on $237m represents about 11% annualized. We don’t know how that value has evolved since 2021 but I haven’t seen any write-off, so I think it’s safe to say that this was actually quite a successful investment. Would that all my not great investments should be this bad!
Hoodlum Posted January 22 Posted January 22 Fairfax continues to buy Under Armour shares, doubling the Class C shares they own over the past 3 days. https://www.streetinsider.com/dr/news.php?id=25876797&gfv=1
Viking Posted January 22 Posted January 22 (edited) 3 hours ago, anshulp said: Tim Eriksen released his Q4 letter today. He made Exco 8.4% of his fund. If I remember correctly Fairfax owns 49% of the company marked at $20.01 (just about where we are at today). Posting his comments: During the quarter we added a new major expert market position, Exco Resources (expert: EXCE). We have followed the company for a number of years and previously owned shares in 2021. Exco is an independent oil and gas company focused on onshore US shale development and production. Their primary areas of focus are Haynesville and Bossier shale in east Texas and north Louisiana, Eagle Ford shale in south Texas, and Marcellus and Utica shales in Appalachia. Exco went through a restructuring and emerged from Chapter 11 in 2019. Exco has performed very well since then (see stock chart to the right). Production is nearly 90% natural gas. At the end of 2020 Exco had just over $560 million of equity ($11 per share based on 51 million shares). Fast forward to September 2025 and Exco had equity of nearly $1.1 billion ($23 per share based on roughly 46 million shares). Mark-tomarket gains and losses on derivatives (hedging) make their earnings swing wildly. We ignore most of that and focus on operating income and cash flow. What caught our attention was their increased production the last three quarters - from 22 Bcfe (billion cubic feet equivalent) in the March quarter, rising to 27 Bcfe in June, and then to nearly 36 Bcfe in September. Additionally, in December they announced a $430 million capex budget for 2026 compared to a ~$185 million budget for 2025. We don’t think you have to be an expert on future natural gas prices or well flow rates to like the setup. With production set to increase and having a proven track record of hedging successfully, we are quite optimistic. If natural gas goes to $2 per mcf, Exco is near breakeven, but will have about $4 per share in cash flow. Assuming a 10% increase in production and pricing of $3 per mcf we think they can earn about $3 per share (and have $7 per share in cash flow), and at $4 per mcf they would push $6 per share (and have total cash flow of about $10 per share) in comparison to its current $19 per share price. As we write this, current two year strip pricing averages about $3.75 per mcf. Hopefully we are underestimating their potential production increase. Lastly as of the end of 2024 reserves were 28 times production. Admittedly, 75% of reserves were undeveloped, but that is still quite impressive. Their PV-10, which is the estimated present value of Exco’s future after tax cash flows discounted back at a 10% rate, was nearly $40 per share. Natural gas pricing outlook is more favorable today than it was at the end of 2024. Obviously, they would be an attractive acquisition candidate. Link to his letter (guy is a beast btw) : https://static1.squarespace.com/static/5ea6570a0ba57d406203e048/t/6971662dea3ab16d2ec514e0/1769039405165/Q4+2025+Results+for+Cedar+Creek+Partners.pdf @anshulp, thanks for sharing. So Exco’s capex budget is going from $185 million in 2025 to $430 million in 2026. Looks like production is going much higher. And they hedge. Looks like a pretty good set-up for much higher earnings in 2026. This is also a perennial acquisition candidate. Another likely tailwind in Fairfax’s equity portfolio. My current estimate for Exco's contribution to share of profit of associates for 2026 is $75 million. That probably should be doubled to $150. Edited January 22 by Viking
Txvestor Posted January 22 Posted January 22 Well not just that, with a 49% stake, since it's categorized as an associate for accounting purposes this could add meaningfully to the earnings in 2026. Q3 had $39M, sounds like it's not a one off and might even go higher.
KFRCanuk Posted January 22 Posted January 22 1 hour ago, Hoodlum said: Fairfax continues to buy Under Armour shares, doubling the Class C shares they own over the past 3 days. https://www.streetinsider.com/dr/news.php?id=25876797&gfv=1 Gemini says: Share Class Shares Held Price (Jan 21, 2026) Market Value Class A (UAA) 41,958,923 $6.15 ~$258.0 million Class C (UA) 18,064,622 $5.96 ~$107.7 million Total Combined 60,023,545 — ~$365.7 million
Hoodlum Posted January 22 Posted January 22 (edited) 8 hours ago, KFRCanuk said: Gemini says: Share Class Shares Held Price (Jan 21, 2026) Market Value Class A (UAA) 41,958,923 $6.15 ~$258.0 million Class C (UA) 18,064,622 $5.96 ~$107.7 million Total Combined 60,023,545 — ~$365.7 million So about 13.9% of total outstanding share (Class A and C). Edited January 22 by Hoodlum
gfp Posted January 22 Posted January 22 Tim's letter has a good analysis of Exco Resources for those interested from a Fairfax / Chou angle https://static1.squarespace.com/static/5ea6570a0ba57d406203e048/t/6971662dea3ab16d2ec514e0/1769039405165/Q4+2025+Results+for+Cedar+Creek+Partners.pdf
yesman182 Posted January 23 Posted January 23 On 1/22/2026 at 12:03 PM, gfp said: Tim's letter has a good analysis of Exco Resources for those interested from a Fairfax / Chou angle https://static1.squarespace.com/static/5ea6570a0ba57d406203e048/t/6971662dea3ab16d2ec514e0/1769039405165/Q4+2025+Results+for+Cedar+Creek+Partners.pdf Do we know if Fairfax still owns ~40% of Exco?
gfp Posted January 23 Posted January 23 8 minutes ago, yesman182 said: Do we know if Fairfax still owns ~40% of Exco? As of Q3 they own this much
Hoodlum Posted January 26 Posted January 26 US based Capital Group which manages mutual funds and individual investor accounts, has built up a 5% equity interest in Eurobank. https://www.eurobank.gr/en/group/grafeio-tupou/etairiki-anakoinosi-26-01-2026-i
Hoodlum Posted January 27 Posted January 27 Eurobank was up another 4% today, +23% this month so far.
UK Posted January 27 Posted January 27 46 minutes ago, Hoodlum said: Eurobank was up another 4% today, +23% this month so far. Not bad for a bank from non investable region:)
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