Fairfax Market Cap 2024

[gary17]

Is this not the usual time of the month when market speculates if FFH may be added to an index.

[Malmqky]

10 minutes ago, gary17 said:

Is this not the usual time of the month when market speculates if FFH may be added to an index.

 

Is mid-June when index will rebalance/potentially add FFH?

[Hoodlum]

5 minutes ago, Malmqky said:

 

Is mid-June when index will rebalance/potentially add FFH?

 

After the close on 6/13, based on the closing share price of 5/30.  

[SafetyinNumbers]

6 hours ago, Malmqky said:

 

Is mid-June when index will rebalance/potentially add FFH?

Announcement after the close on June 6. Rebalance date June 20 at the close.

[nwoodman]

6 hours ago, SafetyinNumbers said:

Announcement after the close on June 6. Rebalance date June 20 at the close.

@SafetyinNumbers you have a much better understanding of how the index inclusion process and how  the committee may work.  Looking at the index inclusion issue I agree that Intact is unlikely to get booted but a realistic candidate may be BCE.  That would reduce the telco weighting, obviously Fairfax doesn’t add anything sector weight wise here but is there another way of seeing this.  Do you think there is any wiggle room for the committee to see Fairfax not as a financial but more  as a conglomerate with global exposure?  Primarily financial but with a look through basket of other industry exposure.  I haven’t given it a whole bunch of time but interested in your thoughts.

 

“About BCE:

 

Founded in 1880 as the Bell Telephone Company of Canada, BCE Inc. has been a cornerstone of Canada’s telecommunications industry. Over the years, it has evolved into a diversified communications and media conglomerate, encompassing Bell Canada and Bell Media, among other subsidiaries.

 

Recent Challenges:

 

• Financial Performance: In Q3 2024, BCE reported a net loss of $1.2 billion, primarily due to a $2.1 billion non-cash impairment charge on Bell Media’s traditional broadcast assets, reflecting ongoing struggles in the traditional advertising market.
• Dividend Concerns: The company cut its dividend by 56% in early 2025—the first reduction in 17 years—citing the need to improve its balance sheet and address high debt levels.
• Operational Challenges: BCE has faced increased competition in the telecom sector, leading to a decline in product revenue and a slight dip in overall operating revenues.”

 

BCE: ~$US 20 bn Mkt Cap

FRFHF: ~ $US 38 bn Mkt Cap

Edited May 28, 2025 by nwoodman

[SafetyinNumbers]

2 hours ago, nwoodman said:

@SafetyinNumbers you have a much better understanding of how the index inclusion process and how  the committee may work.  Looking at the index inclusion issue I agree that Intact is unlikely to get booted but a realistic candidate may be BCE.  That would reduce the telco weighting, obviously Fairfax doesn’t add anything sector weight wise here but is there another way of seeing this.  Do you think there is any wiggle room for the committee to see Fairfax not as a financial but more  as a conglomerate with global exposure?  Primarily financial but with a look through basket of other industry exposure.  I haven’t given it a whole bunch of time but interested in your thoughts.

 

“About BCE:

 

Founded in 1880 as the Bell Telephone Company of Canada, BCE Inc. has been a cornerstone of Canada’s telecommunications industry. Over the years, it has evolved into a diversified communications and media conglomerate, encompassing Bell Canada and Bell Media, among other subsidiaries.

 

Recent Challenges:

 

• Financial Performance: In Q3 2024, BCE reported a net loss of $1.2 billion, primarily due to a $2.1 billion non-cash impairment charge on Bell Media’s traditional broadcast assets, reflecting ongoing struggles in the traditional advertising market.
• Dividend Concerns: The company cut its dividend by 56% in early 2025—the first reduction in 17 years—citing the need to improve its balance sheet and address high debt levels.
• Operational Challenges: BCE has faced increased competition in the telecom sector, leading to a decline in product revenue and a slight dip in overall operating revenues.”

 

BCE: ~$US 20 bn Mkt Cap

FRFHF: ~ $US 38 bn Mkt Cap

The index committee will only remove something if it becomes so small that it doesn’t move the index much or if forced to because something is acquired. That’s why the focus is on AQN being removed as its ~20bp which has historically been a rule of thumb as too small. 
 

 

[villainx]

I was going to reference something Bob Loblaw, but there’s probably a good chance Loblaw is an old timey, venerated Canadian cornerstone company?

 

 

[SafetyinNumbers]

1 minute ago, villainx said:

I was going to reference something Bob Loblaw, but there’s probably a good chance Loblaw is an old timey, venerated Canadian cornerstone company?

 

 

Loblaw is Canada’s better run Kroger and CVS all wrapped into one.

[nwoodman]

30 minutes ago, SafetyinNumbers said:

The index committee will only remove something if it becomes so small that it doesn’t move the index much or if forced to because something is acquired. That’s why the focus is on AQN being removed as its ~20bp which has historically been a rule of thumb as too small. 
 

 

Cheers, so you really need to supernova rather than just underperform for a bi, regardless of market cap, appreciate the insight.  Thanks

[dartmonkey]

3 hours ago, nwoodman said:

Looking at the index inclusion issue I agree that Intact is unlikely to get booted but a realistic candidate may be BCE.  That would reduce the telco weighting, obviously Fairfax doesn’t add anything sector weight wise here but is there another way of seeing this.  Do you think there is any wiggle room for the committee to see Fairfax not as a financial but more  as a conglomerate with global exposure?  Primarily financial but with a look through basket of other industry exposure.

 

This would be a reasonable addition to the index’s current list of categories, and companies like Brookfield and Fairfax, currently called ‘financials’, might be called ‘multi-sector conglomerates ‘, in contradistinction to the pure financials like the banks and the pure insurers like Manulife and Intact.

 

But as long as they keep the current categorization, they are very unlikely to drop big BCE from the overweighted telecom sector just to add even bigger Fairfax to the even more overweighted financial sector.

 

Algonquin would be a better bet, because it is small, very close to the traditional 20 b.p. cutoff. But it has stubbornly stayed at 20 b.p. and the index committee hasn’t pulled the trigger  when it was even smaller.

 

True, Fairfax keeps getting bigger and is I think by far the biggest company not yet in the index. But a more likely scenario is that one of the current 61 members gets taken over and leaves a spot that would probably go to Fairfax, despite the worsening this would cause to sector weightings. 

[nwoodman]

2 minutes ago, dartmonkey said:

But as long as they keep the current categorization, they are very unlikely to drop big BCE from the overweighted telecom sector just to add even bigger Fairfax to the even more overweighted financial sector.

 

Algonquin would be a better bet, because it is small, very close to the traditional 20 b.p. cutoff. But it has stubbornly stayed at 20 b.p. and the index committee hasn’t pulled the trigger  when it was even smaller.

Appreciate that, there is a discretionary aspect to this index thing that I am still trying to get my head around. 

[SafetyinNumbers]

5 minutes ago, nwoodman said:

Appreciate that, there is a discretionary aspect to this index thing that I am still trying to get my head around. 

Just a few indices like the 60 b/c ifs Canada’s contribution to the S&P Global 1200 which also has an index committee. The Canadians are unsurprisingly more conservative on changes. It’s also a rare period with no major acquisitions announced of the 60 for some time.

 

For example, with FFH holding SCR, they qualify for the S&P/TSX Composite as soon as they have the float cap and liquidity. No committee opines. 

Edited May 28, 2025 by SafetyinNumbers

[Hoodlum]

4 hours ago, dartmonkey said:

 

This would be a reasonable addition to the index’s current list of categories, and companies like Brookfield and Fairfax, currently called ‘financials’, might be called ‘multi-sector conglomerates ‘, in contradistinction to the pure financials like the banks and the pure insurers like Manulife and Intact.

 

But as long as they keep the current categorization, they are very unlikely to drop big BCE from the overweighted telecom sector just to add even bigger Fairfax to the even more overweighted financial sector.

 

Algonquin would be a better bet, because it is small, very close to the traditional 20 b.p. cutoff. But it has stubbornly stayed at 20 b.p. and the index committee hasn’t pulled the trigger  when it was even smaller.

 

True, Fairfax keeps getting bigger and is I think by far the biggest company not yet in the index. But a more likely scenario is that one of the current 61 members gets taken over and leaves a spot that would probably go to Fairfax, despite the worsening this would cause to sector weightings. 

 

Is Communication still an overweight category?   With both Rogers and Bell stocks down 30+% over the past 12 months, I would be surprised.

 

I do like your suggestion of a new conglomerates sector and could even enhance it with "Global Conglomerates".  But I suspect this would be a heavier lift then just slipping Fairfax into an overweight Financials sector.   

Edited May 28, 2025 by Hoodlum

[KFRCanuk]

It's been a long road for me as a long term shareholder since 2000. I remember Jan 21, 2003 and the Morgan Keagan report!

 

Anyway, I have been thinking of the future stock price based on the comments in the 2024 Annual Report

 

 

So I decided the play with chatGPT. This is just for fun. 

 

====

Here is the updated projection for Fairfax Financial Holdings Limited (2025–2034) using a Compound Annual Growth Rate (CAGR) of 18%, applied to both market capitalization and stock price from the 2024 base values:

• 2024 Market Cap (Base): CAD 43.91 billion

• 2024 Stock Price (Base): CAD 2,000.00

---

Projected Market Capitalization and Stock Price (2025–2034, CAGR = 18%)

Year	Projected Market Cap (CAD)	Projected Stock Price (CAD)
2025	$51.81 billion	$2,360.00
2026	$61.14 billion	$2,784.80
2027	$72.14 billion	$3,285.06
2028	$85.12 billion	$3,874.37
2029	$100.44 billion	$4,573.76
2030	$118.52 billion	$5,398.03
2031	$139.85 billion	$6,369.68
2032	$165.02 billion	$7,515.22
2033	$194.73 billion	$8,865.96
2034	$229.78 billion	$10,463.83

---

Assumptions

• CAGR: 18% applied annually.

• Share Count: Assumed constant.

• Model: Exponential growth model using the formula:

  Future Value=Base Value×(1+CAGR)n\text{Future Value} = \text{Base Value} \times (1 + \text{CAGR})^{n}

====

 

We shall see how accurate it will be!

 

To me, this seems wild. Sure, I have been asleep at the switch but the work that they have done since 1985 and the work required to keep it up is mind boggling. 

 

 

[KFRCanuk]

One more thing, I asked chatgpt when Fairfax would hit $1T market cap based on the 18% CAGR. It said

 

"Fairfax Financial would reach a $1 trillion CAD market capitalization in approximately 18.3 years, around the year 2043."

 

"the stock price would be approximately CAD 46,134.17 when the market cap reaches $1 trillion CAD."

 

Again, this is all for my enjoyment!

[villainx]

If I knew how to do polls, Fairfax will reach trillion market cap in 20 years, yes or no? 
 

As well, will Fairfax be in the 60 index when it reaches trillion market cap?

 

[Junior R]

might make sense for FFH to do a split in the future

[cwericb]

13 minutes ago, Junior R said:

might make sense for FFH to do a split in the future

I wish! 

Not only would it make Fairfax more attractive for smaller investors, I believe it would easily increase share price. I have several friends who will not buy Fairfax because if they bought any significant number of shares it would represent too large a percentage of their portfolio.

However, the prevailing thoughts on this is that Fairfax feels they believe larger shareholders make up a more stable group of investors or something like that. Personally, I think it is sort of an ego thing on Fairfax part. 

Banks and other firms often split, why not Fairfax? Look at BRK.B ($503.11 USD) and BRK.A ($754,820.00 USD).  If only the "A" shares were available, how many of us would be Berkshire shareholders? I have suggested to several people to look at adding  Fairfax, but as soon as they see the share price they lose interest. Even my kids won't buy Fairfax because they would rather have a larger variety of stocks in their portfolios.

What gets lost here is the fact that small investors quite often become larger investors through time.

JMHO

[73 Reds]

2 minutes ago, cwericb said:

I wish! 

Not only would it make Fairfax more attractive for smaller investors, I believe it would easily increase share price. I have several friends who will not buy Fairfax because if they bought any significant number of shares it would represent too large a percentage of their portfolio.

However, the prevailing thoughts on this is that Fairfax feels they believe larger shareholders make up a more stable group of investors or something like that. Personally, I think it is sort of an ego thing on Fairfax part. 

Banks and other firms often split, why not Fairfax? Look at BRK.B ($503.11 USD) and BRK.A ($754,820.00 USD).  If only the "A" shares were available, how many of us would be Berkshire shareholders? I have suggested to several people to look at adding  Fairfax, but as soon as they see the share price they lose interest. Even my kids won't buy Fairfax because they would rather have a larger variety of stocks in their portfolios.

What gets lost here is the fact that small investors quite often become larger investors through time.

JMHO

What's wrong with owning 1 share? 

[Jaygo]

29 minutes ago, 73 Reds said:

What's wrong with owning 1 share? 

The Psychological biases numerosity and unitosity or something like that. We like to possess large numbers even if it has no bearing on the actual value. And are repelled by large numbers when forking over cash even though it has no bearing on the value.

 

Look at prices and ask yourself why is something 3.99 vs 4.  The penny is meaningless but the simple mind thinks its a lower price. 

 

If a young man could hold 500 Fairfax shares he would feel better than holding 5. It does not make any sense at all but it is true for the vast majority of people.

 

Dont forget were hairless apes!

[TwoCitiesCapital]

3 minutes ago, Jaygo said:

The Psychological biases numerosity and unitosity or something like that. We like to possess large numbers even if it has no bearing on the actual value. And are repelled by large numbers when forking over cash even though it has no bearing on the value.

 

Look at prices and ask yourself why is something 3.99 vs 4.  The penny is meaningless but the simple mind thinks its a lower price. 

 

If a young man could hold 500 Fairfax shares he would feel better than holding 5. It does not make any sense at all but it is true for the vast majority of people.

 

I tend to agree with Fairfax that it's not their job to cater to this nonsensical bias and that it probably DOES make for a more rational shareholder base by excluding them. 

 

Especially in a day and age where fractional shares are now a thing and nobody is prevented from owning it as a result of a high share price. 

[73 Reds]

8 minutes ago, TwoCitiesCapital said:

 

I tend to agree with Fairfax that it's not their job to cater to this nonsensical bias and that it probably DOES make for a more rational shareholder base by excluding them. 

 

Especially in a day and age where fractional shares are now a thing and nobody is prevented from owning it as a result of a high share price. 

Yep.  I was very much against Berkshire's stock split but understood Buffett's reasoning at the time.  Fairfax's stock price is nowhere near the price at which BRK split.

[Hoodlum]

I remember asking my son about this a while back.  His answer somewhat surprised me, but as an engineering student he may have a different psychology than most others. 
 

“To me, there’s something about seeing a “big” stock that makes it feel nicer to own a fraction of rather than diluting the price to compare with smaller companies.  It feels more “premium” if that makes sense“

Edited May 29, 2025 by Hoodlum

[Jaygo]

5 minutes ago, Hoodlum said:

I remember asking my son about this a while back.  His answer somewhat surprised me, but as an engineering student he may have a different psychology than most others. 
 

“To me, there’s something about seeing a “big” stock that makes it feel nicer to own a fraction of rather than diluting the price to compare with smaller companies.  It feels more “premium” if that makes sense“

 

He would be in a very very small cohort who feel that way. He probably passes the marshmallow test. If you own it already you many not mind a large share price but may be less willing to pay up.

 

I have told a few pretty smart individuals about some companies I like and the different biases than come through are crazy. I told my best friend about Terravest at $55 he pulls it up on his phone and said " ya but its tripled already"

 

Another guy who I feel is one of the smartest Ive ever known, polymath type guy about the chances of the Canadian weed stock bubble bursting and he said but everyone is going to turn to legal! even my parents are buying legal. I said its not the customers, it the valuation. He rode some dogs into the ground. 

 

FIL asked about Under armour about 10 years ago. I said buy Walmart instead. He said he hates Walmart because they put all the little guys out of business. No gains for Papa!

 

I have many of my own biases and actively try to recognise them, work with them and circumvent the worst of them. 

[73 Reds]

2 minutes ago, Jaygo said:

 

He would be in a very very small cohort who feel that way. He probably passes the marshmallow test. If you own it already you many not mind a large share price but may be less willing to pay up.

 

I have told a few pretty smart individuals about some companies I like and the different biases than come through are crazy. I told my best friend about Terravest at $55 he pulls it up on his phone and said " ya but its tripled already"

 

Another guy who I feel is one of the smartest Ive ever known, polymath type guy about the chances of the Canadian weed stock bubble bursting and he said but everyone is going to turn to legal! even my parents are buying legal. I said its not the customers, it the valuation. He rode some dogs into the ground. 

 

FIL asked about Under armour about 10 years ago. I said buy Walmart instead. He said he hates Walmart because they put all the little guys out of business. No gains for Papa!

 

I have many of my own biases and actively try to recognise them, work with them and circumvent the worst of them. 

@Jaygo  There are many different kinds of "smart".  Some of the most successful people I know and do business with barely made it out of high school.  The best investments don't need bottom-feeding shareholders.