Parsad Posted February 16, 2012 Share Posted February 16, 2012 It's out. Cheers! http://finance.yahoo.com/news/Fairfax-Financial-Holdings-iw-477178339.html?x=0 Link to comment Share on other sites More sharing options...
Parsad Posted February 16, 2012 Author Share Posted February 16, 2012 Not very good due to mark to market losses on the hedges and catastrophe losses. A breakeven year. Hedges still in place as Prem thinks things will be bad in the next few years. Nice to see Northbridge coming back to form, and Asia is still a rock-star! Cheers! Link to comment Share on other sites More sharing options...
racemize Posted February 16, 2012 Share Posted February 16, 2012 This is likely to sting in the morning! Link to comment Share on other sites More sharing options...
naboo Posted February 16, 2012 Share Posted February 16, 2012 Definitely not good Net investment gains of $691.2 million (net investment losses of $914.9 million in the fourth quarter) Link to comment Share on other sites More sharing options...
zarley Posted February 16, 2012 Share Posted February 16, 2012 I guess I've managed to forget the last 6 months, but what catastrophes were driving the 4th qtr combined ratios? Reinsurance was brutal. Edit-- Thai flooding for one. Ironic that it slipped my mind since Western Digital (WDC) is one of my holdings. Link to comment Share on other sites More sharing options...
naboo Posted February 16, 2012 Share Posted February 16, 2012 And you won't be too happy to see these numbers: Combined ratios of the insurance and reinsurance operations in the fourth quarters and years ended December 31, 2011 and 2010 were: Year ended Fourth quarter December 31, ------------------- ------------------- 2011 2010 2011 2010 --------- --------- --------- --------- Insurance - Canada (Northbridge) 101.9% 111.2% 102.8% 106.9% - U.S. (Crum & Forster and Zenith National) 124.2% 130.1% 114.3% 116.5% - Asia (Fairfax Asia) 89.2% 90.8% 83.2% 89.3% Reinsurance - OdysseyRe 122.7% 85.8% 116.7% 95.0% Reinsurance and Insurance - Other 155.1% 90.1% 140.9% 107.2% --------- --------- --------- --------- Insurance and reinsurance operations 121.0% 102.9% 114.2% 103.5% Definitely not good Net investment gains of $691.2 million (net investment losses of $914.9 million in the fourth quarter) Link to comment Share on other sites More sharing options...
Uccmal Posted February 16, 2012 Share Posted February 16, 2012 Cant say I expected alot. Guess we know why the dividend wasn't increased, eh? Alot of cash sitting in the subs. Explains their ability to buy more companies. Well see what Prem or Andy say about the Insurance outlook tomorrow. Perhaps a buying opportunity? Link to comment Share on other sites More sharing options...
racemize Posted February 16, 2012 Share Posted February 16, 2012 If we exclude the craziness in the early 2000's, what's the book value multiple range that FFH trades at? 0.8-1.6? Link to comment Share on other sites More sharing options...
Santayana Posted February 16, 2012 Share Posted February 16, 2012 Uh oh ... guess were gonna shoot down to 375 or lower tomorrow. Bummer. Not a bummer if you have cash. Link to comment Share on other sites More sharing options...
racemize Posted February 16, 2012 Share Posted February 16, 2012 But wait these results came out at 2pm and the stock barely budged, maybe I'm missing something. 2 PST, markets were closed. Link to comment Share on other sites More sharing options...
Aberhound Posted February 17, 2012 Share Posted February 17, 2012 Nice bond gains and the losses could have been worse for a year with so many loss events. It could have been much worse. Now only one year to go to solar maximum so I am expecting one more bad year. I am glad to see the subs have built up so much cash. I hope they increase their rates. Link to comment Share on other sites More sharing options...
Alekbaylee Posted February 17, 2012 Share Posted February 17, 2012 As a result of the rise in catastrophes, insurance premiums are also rising, and so now is actually a good time to be writing such business, Mr. Watsa added. “The big advantage is that when this happens, pricing goes through the roof. The pricing in Japan has gone up very significantly, and pricing in Thailand is going up. When I say ‘significantly,’ I’m talking 50 to 100 per cent, big price increases.” http://www.theglobeandmail.com/globe-investor/watsa-sticks-to-his-guns-as-pessimism-proves-costly/article2341221/ Link to comment Share on other sites More sharing options...
Uccmal Posted February 17, 2012 Share Posted February 17, 2012 I love his last comment to the globe reporter "no one in our industry has even come close [to our long term results]. No one... Link to comment Share on other sites More sharing options...
Myth465 Posted February 17, 2012 Share Posted February 17, 2012 I guess I've managed to forget the last 6 months, but what catastrophes were driving the 4th qtr combined ratios? Reinsurance was brutal. Edit-- Thai flooding for one. Ironic that it slipped my mind since Western Digital (WDC) is one of my holdings. Im kicking myself. I was early on WDC in late 2010 and managed to make no money on it. Almost bout huge at $26 due to flooding using leaps...... Link to comment Share on other sites More sharing options...
Guest misterstockwell Posted February 17, 2012 Share Posted February 17, 2012 When they say there was a mismatch in equity investment gains and hedge losses in Q4, they weren't kidding! Yikes. Whatever they do, I beg that they don't use the "excluding catastrophe losses" line tomorrow on the call. You can't exclude that one. That's a whopper. That's bad underwriting. Link to comment Share on other sites More sharing options...
Liberty Posted February 17, 2012 Share Posted February 17, 2012 Im kicking myself. I was early on WDC in late 2010 and managed to make no money on it. Almost bout huge at $26 due to flooding using leaps...... That's too bad. I remember you were one of the most vocal supporters of WDC back when I first gave it a look. Ultimately it wasn't a company for me, but I kind of expected you to be rolling in cash by now. Link to comment Share on other sites More sharing options...
Myth465 Posted February 17, 2012 Share Posted February 17, 2012 It will work out. I have learned quite a bit over the last year, but made little cash. With ATSG, Petrobank / Petrobakken, FTP, and WDC - I should have been buying hand over fist during those collapses. Going to restructure my portfolio to feature 25% cash, because these deals seem to come along a few times a year. If you know the company / management it should have been easy to step up and buy. I did buy a boat load of SD, so hopefully things play out. Liberty based on what you hold I would think you were doing quite well also. Link to comment Share on other sites More sharing options...
zarley Posted February 17, 2012 Share Posted February 17, 2012 I guess I've managed to forget the last 6 months, but what catastrophes were driving the 4th qtr combined ratios? Reinsurance was brutal. Edit-- Thai flooding for one. Ironic that it slipped my mind since Western Digital (WDC) is one of my holdings. Im kicking myself. I was early on WDC in late 2010 and managed to make no money on it. Almost bout huge at $26 due to flooding using leaps...... I recall we had a brief exchange about WDC about a year ago (when I first bought). We had the same perspective on it, so I naturally thought you were pretty sharp. :) The Thai floods did worry me a bit, but also gave an opportunity to buy really low (~$25), which I did a little of. After FFH gets hammered in the morning, WDC probably be my third largest holding. Link to comment Share on other sites More sharing options...
Myth465 Posted February 17, 2012 Share Posted February 17, 2012 Congrats Zarley let me know what you buy next. :) Link to comment Share on other sites More sharing options...
zarley Posted February 17, 2012 Share Posted February 17, 2012 Congrats Zarley let me know what you buy next. :) Real time buy and sell calls cost extra. ;D Although, I'm still slightly underwater on L . . . watching that paint dry. Link to comment Share on other sites More sharing options...
Myth465 Posted February 17, 2012 Share Posted February 17, 2012 Congrats Zarley let me know what you buy next. :) Real time buy and sell calls cost extra. ;D Although, I'm still slightly underwater on L . . . watching that paint dry. LOL. I love Loews, just wise the Tisches were hungrier. How could you not have found value from 2008 - 2012... At least buy back a boat load of stocks in the subs. They just keep missing the board, should have bought more DO during DWH. I will own Loews one of these days but prefer cash these days. The value is there though. Link to comment Share on other sites More sharing options...
rijk Posted February 17, 2012 Share Posted February 17, 2012 fairfax's significant $12 billion bond holdings, of which 75% has a maturity > 5 years, seems to go totally against buffett's recent warning to stay away from bonds ("Bonds promoted as offering risk-free returns are now priced to deliver return-free risk.") what would be the implications for fairfax if buffett is right, i.e. how much wiggle room do they have to "adjust" their bond positions if things slowly develop in line with the buffett scenario? regards rijk Link to comment Share on other sites More sharing options...
Williams406 Posted February 17, 2012 Share Posted February 17, 2012 Related to Fairfax's bond position, I came across a good interview of Lacy Hunt, of Hoisington Investment Management, by Kate Welling, courtesy of John Mauldin: http://www.investorsinsight.com/blogs/john_mauldins_outside_the_box/archive/2012/02/13/face-the-music.aspx Link to comment Share on other sites More sharing options...
Liberty Posted February 17, 2012 Share Posted February 17, 2012 Down 7% to 388 this morning. Link to comment Share on other sites More sharing options...
racemize Posted February 17, 2012 Share Posted February 17, 2012 I may be drinking the kool-aid, but listening to this phone call, I feel pretty good about future prospects. However, I bought at a higher price to book than I wanted/thought (sadface). Link to comment Share on other sites More sharing options...
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