Fairfax Financial Holdings Limited (USA) (FFH)

finviz.com

Fairfax just had a good quarter. It has seen a big rise in book value which is not yet reflected in the share price, and any additional appreciation in its equity holdings will increase book value still more. Odyssey Re is putting up good numbers. A link to a transcript of the most recent conference call is available here:

http://seekingalpha.com/article/170221-fairfax-financial-holdings-limited-q3-2009-earnings-call-transcript?source=yahoo&page=-1

We follow Prem Watsa and Fairfax on our blog at the Three Dollar Hedge Fund: http://threedollarhedgefundblogspot.com

great picker at the helm, emulating buffett

I found this while scanning last Thursday the 1st (added about 8 shorts out of that list) .... now the chart is looking kinda 'Dave Landry'ish so I'll give it the thumbs down here.

Solid investment track record

This outperform call is a vote for Prem Watsa and his awesome team at this relatively unknown Canadian insurance holding company.

Do your own homework. Don't listen to me, pick up a book or an annual report or a shareholder letter and try using it for more than a doorstop or firestarter. If you want a prompt however, try this:

Insurance. Watsa. 20 year CAGR in excess of 20%. Called the housing bubble and credit collapse and profited on the order of $1billion from it- so much so that declared a special one time divy (in addition to the regular one) in 1Q 2008. If you like MKL you should love this one- used to be MKL's Canadian subsidiary until Prem took over. Now he thrashes MKL on CAGR. Will be interesting to see how One Markel and specialized insurance lines stack up to FFH and superior investing acumen with global reach and superior operating lines over the next 10 years.

Pabrai just upped his stake by 50%.

Amassed a number of stocks at bargain basement prices such as USB, DELL, ICO, USG, etc etc.
Trading below book value - 315(last Quarter) + 20%.

If compared to BRK, this should be trading at $491+

Going by the book value or earnings (low P/E) this is a fantastic value fo rthe money.

Simply growth and value

Comparitive financials to Berkshire, large increase of investments while the market was down, large gains in the future.

Selling close to book value (probably a little under book value). So you are getting proven, high quality management for free. They call this a mini-Berkshire for a reason, it has superior management and they know how to make great investments.

1/18 in Multi-line Insurance -(87.4@A+/A-)

Fairfax Financial is one of the few companies that are in better shape now than before the financial crisis, primarily do to Prem Watsa bet against the housing bubble that lead to the companies gain of $2 Billion during the crisis.

Extremely cheap at these levels. Unlike the other BRK wanna-be's (BAM, LUK, and others). FFH actually has shareholder VALUE. With share buybacks, 3+% rising dividend (6% payout ratio), below book value, 1/2 price to sales, and trades for less than 5 times trailing earnings. This is a Buffet play for sure. This Toronto insurance company is a great asset allocator and has a fantastic CEO, Prem Watsa. Some refer to him as the Canadian Warren Buffet. He was one of the few investors that bet against the housing bubble. He made billions by buying credit default swaps that would rise in value as other companies creditworthiness deteriorated. FFH continues operations expanding globally, with subsidiaries in Asia and central Europe. With a 23% average return over the last few years (yes, even in 2008!!), this is definitely a buy and hold stock at these levels.

Insurance companies that know how to manage risks and capital well will prosper in the long-term.

Good insurance underwriting and excellent investing come together to make this an excellent long run growth engine. The insurance market is hardening and future investment returns, although bumpy in the short term, should look very good. I expect book value per share growth of around 10-15% and a future price to book higher than current 0.90x.

Excellent investment management

The man is the man

These guys know how to allocate capital, strong stockholder value focus...give it time, long term hold