Fairfax 2026

[SafetyinNumbers]

5 minutes ago, gfp said:

But there was a loss recognized on excess of $$$ paid over carrying value on earlier Allied World minority interest buy outs right?  As in, some premium to straight book value?

I don’t think it’s related to book value at all. Just the initial purchase price plus the preferred dividend less any dividends paid. 

[gfp]

36 minutes ago, SafetyinNumbers said:

I don’t think it’s related to book value at all. Just the initial purchase price plus the preferred dividend less any dividends paid. 

 

In 2022 they paid $733.5m to extinguish 12% non-controlling interest of Allied World that was on their books for something less than $733.5m (I don't know how much less, because the $733.5m included a partial accrued dividend to that date) and they took a $228.1m non-cash accounting charge (not through the income statement, through the equity statement - directly to retained earnings).

 

So Allied was carried at X valuation on Fairfax's books...  And Fairfax paid a premium to X valuation to retire the 12% minority interest.  Part of that payment was the accrued dividend but they paid a premium to their carrying value for the 12% and took a loss because they didn't write up what they already owned (they wrote-down what they had just paid for)

 

 

 

[SafetyinNumbers]

15 minutes ago, gfp said:

 

In 2022 they paid $733.5m to extinguish 12% non-controlling interest of Allied World that was on their books for something less than $733.5m (I don't know how much less, because the $733.5m included a partial accrued dividend to that date) and they took a $228.1m non-cash accounting charge (not through the income statement, through the equity statement - directly to retained earnings).

 

So Allied was carried at X valuation on Fairfax's books...  And Fairfax paid a premium to X valuation to retire the 12% minority interest.  Part of that payment was the accrued dividend but they paid a premium to their carrying value for the 12% and took a loss because they didn't write up what they already owned (they wrote-down what they had just paid for)

 

 

 

I just meant I don’t think the purchase price is determined off of book value. The accounting is another story all together.

[investmd]

22 hours ago, investmd said:

Video on topic often discussed here on COBF : Is FFH today a young BRK? 

 

Lauren Templeton is a current member of Board of Directors at FFH, Founder of Templeton and Phillips Mgmt and great niece of John Templeton. She gave a talk last week in Omaha where she made a strong case for investing in FFH based on data showing why FFH today is where BRK was 30 years ago. Her talk was part of ValueX BRK. For those that want to watch, her talk starts at 4hr, 3mins mark of the video. The presentation as well as Q&A lasts 15mins. 

 

I didn't have any obvious push backs to Lauren Templeton's argument. Curious if anyone here has a contrarian view to hers or questions any of her data points. 

I rewatched the video of Lauren Templeton talk starting at 4hr 3mins mark and took away the following highlights from her presentation on FFH: 

 

1. Extraordinary to compound at 18%+ CAGR for 4 decades: FFH track record since 1985 would put it in top 1% of all US listed companies and #7 overall: 
2. She makes a comparison that what FFH has achieved today is akin to what BRK achieved around 2000 - since that time BRK has been a 10x. Will FFH be a 10x over next 25 yrs? 
3. She highlights that FFH is a collection of businesses built to compound
4. Finally, audience asks a q re portfolio allocation in her own fund. She doesn't answer directly, but online her fund has approx 12% of AUM in FFH - decent sized position for sure. Interesting q from the audience member might have been if she has a max cap on the allocation or they are willing to let it run

 

Here is the talk again: 

 

[Marco Van Basten]

4 hours ago, investmd said:

I rewatched the video of Lauren Templeton talk starting at 4hr 3mins mark and took away the following highlights from her presentation on FFH: 

 

1. Extraordinary to compound at 18%+ CAGR for 4 decades: FFH track record since 1985 would put it in top 1% of all US listed companies and #7 overall: 
2. She makes a comparison that what FFH has achieved today is akin to what BRK achieved around 2000 - since that time BRK has been a 10x. Will FFH be a 10x over next 25 yrs? 
3. She highlights that FFH is a collection of businesses built to compound
4. Finally, audience asks a q re portfolio allocation in her own fund. She doesn't answer directly, but online her fund has approx 12% of AUM in FFH - decent sized position for sure. Interesting q from the audience member might have been if she has a max cap on the allocation or they are willing to let it run

 

Here is the talk again: 

 

10x over twenty five years is not that great… it is 9.6 percent per year 

[SafetyinNumbers]

4 hours ago, investmd said:

She makes a comparison that what FFH has achieved today is akin to what BRK achieved around 2000 - since that time BRK has been a 10x. Will FFH be a 10x over next 25 yrs? 

My takeaway was different from this slide. I thought it was interesting that BRK’s investment portfolio and insurance float are both the same size in 2002 as Fairfax is now. Back then BRK had a market cap of US$110b while FFH is closer to US$35b now. 

[gfp]

Does anybody else think it is completely inappropriate for a member of the board of directors to give a straight up stock pitch presentation?  Why is she trying to convince people to invest in Fairfax?  Never seen it before and I hope I never see it again.

[SafetyinNumbers]

24 minutes ago, gfp said:

Does anybody else think it is completely inappropriate for a member of the board of directors to give a straight up stock pitch presentation?  Why is she trying to convince people to invest in Fairfax?  Never seen it before and I hope I never see it again.

I don’t think it’s inappropriate, personally. It’s a good idea and it’s the perfect audience to pitch it to. They should be primed to receive it and if they care absolute returns they should consider switching something out of BRK into FFH. As a FFH shareholder myself, it’s exactly, who I want as a fellow shareholder because it means a tighter float and ultimately a higher multiple in the next hard market.

[Parsad]

4 hours ago, gfp said:

Does anybody else think it is completely inappropriate for a member of the board of directors to give a straight up stock pitch presentation?  Why is she trying to convince people to invest in Fairfax?  Never seen it before and I hope I never see it again.

 

Gfp, you see it all the time...every hour of every day...there are CEO's, executives, directors, etc touting their company in the newspaper, television, online, etc.  Nobody complains about it when those that are long (insiders/outsiders) tout companies, but we all (including myself) complain when people are touting shorts.  Unfortunately, as Buffett and Munger noted this many years ago, this is common practice.  Not that I agree with it, but it has always existed on the long side in particular.  To your point, I agree, independent directors in particular should be careful when they do this...but it does happen in the industry daily.  

 

Now in terms of Lauren doing this...I know her quite well from our trip to India several years ago...she was a shareholder before joining the Fairfax board, was a Berkshire shareholder obviously for a very long-time, and Sir John was a Fairfax shareholder right in the beginning.  So her presentation could be viewed from two angles...one as a director, one as a historical recap of Fairfax compared to Berkshire.  I think she comments on this before she answers the questions Guy pushes her to answer.  Cheers!

[Hamburg Investor]

10 hours ago, investmd said:

She makes a comparison that what FFH has achieved today is akin to what BRK achieved around 2000 - since that time BRK has been a 10x. Will FFH be a 10x over next 25 yrs? 

Really like this chart! Thank you! @investmd! 

 

Many of us might have been aware, that FFH is much more into insurance, than BRK was; still it’s a great and insughtful perspective.

 

Actually my personal take from the chart is…

1. FFH lower valued by Mr. Market. Brk was valued higher at same equity than FFH is valued today (1996 vs. 1997)

2. FFH with (much)  higher float leverage.
FFH has (probably much) higher float leverage than BRK had through float (1996 /1997 vs. 2002). Risk free returns might have been higher 1996/1997; still compared to the market, that lever helps FFH with outperforming the market more than BRK could. And maybe even helps driving FFHs roe higher than BRKs.

3. FFH 1 1/2 decades ahead regarding premiums

FFH has (probably manyfold) that much premiums compared to BRK (1996 vs. 2012 - FFH is 16 years ahead. That’s a lot!). Assuming FFHs overall insurance business is more profitable (in absolute terms) over time, FFH has a stronger roe driver ahead compared to BRK. I haven’t done the math, but watching FFHs insurance business letting the average American insurance business behind by around 3 to 4 percentage points per year on average since 2011 (compared to lagging it by the same amount until 2011; so that‘s an improvement of 6 to 8 percentage points against the market after 2011 to before 2011), that gives a lot of confidence to me for FFHs future!

Of course I could be mislead. E. g. BRKs premiums and float could have standed at 99% of FFHs from 1996 to 2002/2012. But I don’t think so. Haven’t looked at the numbers, so I could be off here. But my gut feeling is, that the direction could be very roughly right. There is more leverage built into FFH today than it was in BRK. And the market loved BRK more, than it loves FFH today. (And FFH is smaller and my guess is will stay smaller. As the biggest reason for staying smaller is buybacks, that helps returns all the more).

 

Of course higher leverage means higher risk at least in theory and maybe in practice. So everyone has to do his own due diligence. As always.

Edited May 10 by Hamburg Investor

[John Hjorth]

7 hours ago, gfp said:

Does anybody else think it is completely inappropriate for a member of the board of directors to give a straight up stock pitch presentation?  Why is she trying to convince people to invest in Fairfax?  Never seen it before and I hope I never see it again.

 

@gfp,

 

Count me in. I don't like that at all.

[Viking]

11 hours ago, gfp said:

Does anybody else think it is completely inappropriate for a member of the board of directors to give a straight up stock pitch presentation?  Why is she trying to convince people to invest in Fairfax?  Never seen it before and I hope I never see it again.

Personally, I don’t have a problem with what Lauren did. 
 

One of the reasons Buffett did not do stock buybacks was because Berkshire Hathaway had a big information advantage over shareholders - so buying them out when the shares were undervalued was kind of immoral behaviour in Buffett’s mind (taking advantage of BRK shareholders). 
 

Pivot to Fairfax today. Fairfax has been buying back extraordinary amounts of stock over the past 8.25 years (~25% of effective shares outstanding). Fairfax has been telling investors (and shareholders) for years at pretty much every chance they get that they think their stock is undervalued. This continues to be the case today. 
 

My guess is Lauren’s topic/presentation was vetted through senior management at Fairfax and they were ok with it (most of what she presented was material that was covered at the recent AGM). What she presented was very high level - it was primarily educational and a framework - a way for investors (and shareholders) to think about and better understand the company and the opportunity that exists today. To help them better value the company. 
 

My view is Fairfax continues to be misunderstood, under-appreciated and miss valued as a company. (I am not complaining… this has proven to be a big benefit to the company and long term shareholders.) I applaud the efforts of management and those associated with Fairfax of continuing to educate investors (and shareholders) to help them better understand the company as it exists today.

 

And nobody is paying attention anyways - this is Fairfax after all. 

Edited May 10 by Viking

[gfp]

The one thing Prem would never have done with those same slides at the AGM was compare Fairfax to Berkshire and suggest a similar outcome to Berkshire from an earlier point in time.  As shareholders, we can do that comparison, but a board member should not be doing that "here's your chance to own the next Berkshire" sales pitch and I think its just as shady when Ackman does it with his "modern-day Berkshire" while he feverishly reads "Ajit Jain for dummies" and buys an insurance company.  Buy insurance company...  Invest surplus in equities...  PROFIT!  Graveyard is full of hedge funds who had that game plan.

 

Showing the results of the past is fine - they should be proud of their track record.

 

Lauren's presentation was fine, just not appropriate for a board member of the company.  If she were just a fund manager that had a long term position in the stock it's totally fair game to talk her book / pitch her favorite holdings - that's what all those people do at conferences.  Raise money for Cancer?  Pump a new undisclosed holding..  Again, Ackman figured out the playbook many years ago at Sohn and similar hedge fund events.

[Munger_Disciple]

11 hours ago, gfp said:

Does anybody else think it is completely inappropriate for a member of the board of directors to give a straight up stock pitch presentation?  Why is she trying to convince people to invest in Fairfax?  Never seen it before and I hope I never see it again.

 

I thought it was highly inappropriate just like you. I don't think I have ever seen an independent board member of a public company pumping the stock like that. Very unseemly & very un-Berkshire like. Besides it makes no sense to pump the stock up when the company is apparently buying back stock. Someone should tell her to stop this. 

[MMM20]

3 hours ago, Munger_Disciple said:

I don't think I have ever seen an independent board member of a public company pumping the stock like that.

Maybe it’s worth revisiting the conversation about whether it’s time for Fairfax to upgrade its governance including the board. I don’t mean to single out Lauren Templeton, but can’t we go get some more truly independent and high level business people at this point in FFH’s development? I would think some of these folks own the stock already, and for Canadians it would be as prestigious as BRK’s board. Like why not go get Tobi Lutke or someone at that level?

 

Edited May 10 by MMM20

[SafetyinNumbers]

5 hours ago, Munger_Disciple said:

don't think I have ever seen an independent board member of a public company pumping the stock like that. Very unseemly & very un-Berkshire like.

I didn’t think it was a pump at all. I have heard Chris Davis who is also an asset manager and sits on Berkshire’s board do interviews on Berkshire. Why is that so different than what Lauren did?

[Munger_Disciple]

37 minutes ago, SafetyinNumbers said:

I didn’t think it was a pump at all. I have heard Chris Davis who is also an asset manager and sits on Berkshire’s board do interviews on Berkshire. Why is that so different than what Lauren did?

 

As far as I know, Davis never told anyone to go and buy Berkshire. And he didn't make power point presentations on how great the numbers are at an investor conf. In the media interviews I find him quite measured. 

Edited May 10 by Munger_Disciple

[SafetyinNumbers]

34 minutes ago, Munger_Disciple said:

 

As far as I know, Davis never told anyone to go and buy Berkshire. And he didn't make power point presentations on how great the numbers are at an investor conf. In the media interviews I find him quite measured. 

I guess you see a distinction that I don’t. I’m not sure what the harm is. I like giving good ideas to people at good prices as I do it myself so I’m biased. I’m guessing you think Bob Robotti is bad actor too. 

Edited May 10 by SafetyinNumbers

[Maverick47]

7 hours ago, Viking said:

Personally, I don’t have a problem with what Lauren did. 

Nor do I.  
 

Lauren was speaking to a very specific audience of people who were in attendance at the annual meeting of Berkshire Hathaway.  I have been a 30 year holder of Berkshire Hathaway myself, and have never gone to the Woodstock for Capitalism myself.  Nevertheless I have often privately bemoaned that by the time I learned about the company and had enough personal resources to invest in it, that the glory years were behind it. 
 

I tell myself and the family members on whose behalf I have also invested in Berkshire that we can be proud of owning a company with integrity and based on value investing principles…but that its size will work against the likelihood that our investment in it will compound at much more than the stock market index as a whole.

 

For 20 years now, I have also been searching for smaller Berkshire like companies that I can place part of our retirement accounts in…to include Markel, Alleghany and Fairfax since that time.

 

Berkshire bought out Alleghany, so we’ve been left with Markel and Fairfax as potential smaller companies that might be able to compound in our portfolios faster than a mature Berkshire.

 

Berkshire has benefited over the years from having attracted a very loyal shareholder base who have held the stock for years and years, and even decades and decades.  If a company happens to have a similar value investing philosophy, and envies the shareholder base Berkshire has maintained, what better place to share the story of your company with than those same folks?
 

That’s why Markel has long held meetings in Omaha during the Berkshire meeting to share the story of Markel with Berkshire meeting attendees.

 

A less than 30 minute presentation on Fairfax at Guy Spier’s conference, which mostly regurgitated slides already made public at the Fairfax annual meeting, and which annual meeting had already touted the CAGR for Fairfax stock since 1985 doesn’t seem to be beyond the pale to me.  
 

And at the Fairfax annual meeting, it was explicitly shown that since 1985, Fairfax’s market value per share had compounded even faster than Berkshire over the same period.  So the Fairfax annual meeting was already comparing the performance of Fairfax to Berkshire.

 

As a longtime Fairfax holder (20 years now), I would prefer to have more long term Berkshire owners take a look at the company than the kind of folks who listen to short seller reports.

 

If I had not already known about Fairfax, I would think of Lauren’s presentation as being a public service. 
 

I first heard of Fairfax years ago when reading a book called “Selling America Short”.

 

Some time later I remember hearing Whitney Tilson referring to the company as “crappy underwriters with a great investment arm”.  
 

Lauren has made a small addition to publicly available comment on the company, and it’s a bit of a counterbalance to a lot of the negative commentary the company has experienced over the years.

[Munger_Disciple]

24 minutes ago, SafetyinNumbers said:

I guess you see a distinction that I don’t. I’m not sure what the harm is. 

 

We clearly have a different view on what's appropriate behavior for a board member is. Let's leave it at that.

[SafetyinNumbers]

34 minutes ago, Munger_Disciple said:

 

We clearly have a different view on what's appropriate behavior for a board member is. Let's leave it at that.

I think the context as @Maverick47has laid out matters. Consider it left. 

[Parsad]

6 hours ago, MMM20 said:

Maybe it’s time to revisit the conversation about whether it’s time for Fairfax to upgrade its governance including the board. I don’t mean to single out Lauren Templeton, but can’t we go get some more truly independent and high level business people at this point in FFH’s development? I would think some of these folks own the stock already, and for Canadians it would be as prestigious as BRK’s board. Like why wouldn’t we go get Tobi Lutke or someone like that?

 

 

Tobi Lutke?!!!  Are you serious?

 

You mean like Howard Buffett, Susan Buffett and Bill Gates?  No board is immune to this.  Prestige may mean scandal like in Gates situation. 

 

How is Lauren Templeton any different than Wally Weitz on Berkshire's Board?  I think you guys are blowing this out of proportion.

 

The indignation has been displayed...they read this board...likely Lauren won't do that presentation again.  Cheers! 

[Txvestor]

On 5/9/2026 at 3:59 PM, gfp said:

 

In 2022 they paid $733.5m to extinguish 12% non-controlling interest of Allied World that was on their books for something less than $733.5m (I don't know how much less, because the $733.5m included a partial accrued dividend to that date) and they took a $228.1m non-cash accounting charge (not through the income statement, through the equity statement - directly to retained earnings).

 

So Allied was carried at X valuation on Fairfax's books...  And Fairfax paid a premium to X valuation to retire the 12% minority interest.  Part of that payment was the accrued dividend but they paid a premium to their carrying value for the 12% and took a loss because they didn't write up what they already owned (they wrote-down what they had just paid for)

 

 

 

Easy and better when it's a never sell asset. 

[MMM20]

18 minutes ago, Parsad said:

Tobi Lutke?!!!  Are you serious?

Fine, name your favorite Canadian entrepreneur then. Maybe he’s not quite the Canadian bill gates. I hope you get my point. It’s not like I said Ryan Reynolds or Gretzky.
 

My point is that they could probably do well to do more to upgrade the board these days at this scale and as they transition to the next generation of leadership.

 

Edited May 11 by MMM20

[Parsad]

2 minutes ago, MMM20 said:

Fine, name your favorite self-made Canadian billionaire then. Maybe he’s not quite the Canadian bill gates. I hope you get my point.

 

Jim Pattison...hands down would be perfect!  But he's nearly Buffett's age.  

 

Francis Chou!  Can't think of anyone better, more honest, knows the company better than almost anyone other than Prem, understands the culture, has never sold a share and is an insurance and investment genius!  He also has everyone's respect and gives even more respect back!  If Prem is listening, Francis should be sitting on the Fairfax board...110%!!! 

 

Cheers!