Fairfax Financial Holdings (FFH) AI Stock Analysis

• Market Cap: $51.13B
• Dividend Yield: 0.84%
• Average Volume (3M): 111.04K
• Price to Earnings (P/E): 8.6
• Beta (1Y): 0.52
• Revenue Growth: 10.08%
• EPS Growth: 24.18%
• Country: CA
• Employees: 47,040
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Property & Casualty
• EPS (TTM): 78.13
• Shares Outstanding: 19,900,800
• 10 Day Avg. Volume: 131,564
• 30 Day Avg. Volume: 111,043
• PEG Ratio: 0.26
• Price to Book (P/B): 1.54
• Price to Sales (P/S): 1.34
• P/FCF Ratio: 17.05
• Enterprise Value/Market Cap: 0.79
• Enterprise Value/Revenue: 1.34
• Enterprise Value/Gross Profit: 6.16
• Enterprise Value/Ebitda: 5.05
• 1Y Price Target: $2,824.20
• Price Target Upside: 18.47% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): 188.68
• Revenue Forecast (FY): $34.22B

• Rating: 72 Outperform
• Price Target: C$2,649.00 ▲(11.12% Upside)
• Action: Upgraded Date: 03/21/26
• Date: Action: Upgraded 03/21/26

The score is driven primarily by solid financial performance (strong recent profitability and ROE, moderate leverage) tempered by cash-flow volatility. Technicals are supportive with the stock trading above major moving averages, though short-term momentum looks extended. Valuation is a positive contributor due to a low P/E, while dividend yield is only modest.

Positive Factors

Profitability & ROE

Fairfax’s sustained low-to-mid teen net margins and healthy mid-to-high teen ROE reflect durable profitability from combined underwriting and investment results. Consistent earnings power supports reserve strengthening, capital reinvestment and long-term value creation, reducing reliance on short-term market swings.

Diversified earnings model

The business combines P&C underwriting with active investment of insurance float, providing two durable income streams. Investment returns on float offer optionality and potential upside while underwriting generates recurring premiums, making the overall cash-generation and profit profile less dependent on any single market.

Capital flexibility via asset monetization

The planned ~$1.91B sale of Poseidon shares materially increases liquidity and reduces equity concentration, giving Fairfax structural flexibility to allocate capital to underwriting, buybacks, debt reduction or new investments. This is a lasting change to the investment portfolio and balance sheet optionality if transactions close.

Negative Factors

Cash-flow volatility

FFH exhibits inconsistent cash conversion: negative OCF/FCF in 2022–2023 and a sharp FCF decline in 2025 versus 2024. Persistent cash volatility complicates capital planning, reduces predictability for dividends/repurchases and forces reliance on asset sales or financings during adverse cycles.

Underwriting cyclicality & reserve risk

P&C and reinsurance underwriting are intrinsically cyclical and exposed to catastrophe losses and reserve development. These structural risks can produce multi-year swings in underwriting margins and capital needs, requiring conservative reserving and reinsurance strategies to protect solvency and long-term profitability.

Rising absolute debt levels

Although leverage ratios are moderate, Fairfax’s debt has increased in absolute terms as the business grows. Higher nominal debt raises fixed obligations and interest sensitivity, narrowing the margin for underwriting or investment underperformance and increasing dependence on steady cash generation to preserve financial flexibility.

Fairfax Financial Holdings Business Overview & Revenue Model

Company Description

Fairfax Financial Holdings Limited, through its subsidiaries, provides property and casualty insurance and reinsurance, and investment management services in the United States, Canada, Asia, and internationally. The company operates through Insurance and Reinsurance, Run-off, and Non-Insurance Companies segments. It insures against losses to property from fire, explosion, earthquake, windstorm, flood, boiler explosion, machinery breakdown, and construction defects, as well as underwrites automobile, commercial and personal property, and crop insurance. The company also offers workers' compensation, employer's liability, accident and health, medical malpractice, professional liability, and umbrella coverage insurance products; marine, aerospace, surety risk, and other risks and liabilities insurance products; and reinsurance products. In addition, it retails home improvement goods, toys and baby products, golf equipment, sports apparel and accessories, housewares and home décors, and tableware and gifts; invests in retail business; and owns and operates holiday resorts. Further, the company provides integrated travel and travel-related financial services; originates, processes, and distributes pulses and staple foods; creates, produces, and distributes entertainment content; and provision of pet medical insurance and database services, as well as media and marketing solutions. The company was formerly known as Markel Financial Holdings Limited and changed its name to Fairfax Financial Holdings Limited in 1987. Fairfax Financial Holdings Limited was incorporated in 1951 and is headquartered in Toronto, Canada.

How the Company Makes Money

FFH primarily makes money through (1) underwriting in its P&C insurance and reinsurance businesses and (2) investment income and gains generated from investing the insurance float and shareholders’ equity. 1) Underwriting income (insurance and reinsurance operations) - Premiums: FFH’s operating insurance companies collect premiums from policyholders for coverage (e.g., commercial and personal P&C lines). In reinsurance, premiums are earned by assuming risk from other insurers. - Claims and benefits: When insured events occur, FFH pays claims. The difference between premiums earned and claims paid (plus related loss adjustment expenses) is a core driver of underwriting results. - Operating expenses: Insurance operations incur commissions, brokerage, underwriting, and administrative expenses. Underwriting profit/loss is influenced by pricing discipline, claims frequency/severity, catastrophe losses, reinsurance protection purchased, and expense efficiency. - Net underwriting result: Profit arises when the combined ratio is below 100% (i.e., premiums exceed claims and expenses). Underwriting results can be volatile due to catastrophe events and reserve development. 2) Investment income and gains (asset management of float and capital) - Insurance float: FFH invests funds that arise because premiums are typically received before claims are paid (the “float,” reflected in insurance liabilities such as loss reserves and unearned premiums). This provides investable assets even if underwriting is near break-even. - Portfolio returns: Earnings come from interest and dividend income (e.g., from fixed income and equities) and from realized/unrealized gains and losses on invested assets. - Interest-rate and credit environment: Returns on fixed-income holdings depend on market yields, credit spreads, and defaults; equity and other investments depend on market performance and security selection. 3) Other contributing factors - Reinsurance strategy: Buying reinsurance can reduce catastrophe volatility but adds a cost; selling reinsurance can add premiums but increases exposure. Net earnings reflect the balance of retained risk and ceded protection. - Capital allocation: Over time, results are influenced by acquisitions/divestitures of insurance subsidiaries, portfolio reallocations, and the use of excess capital (e.g., potential share repurchases or debt/capital structure decisions). Specific arrangements and figures not provided here are null.

Fairfax Financial Holdings Financial Statement Overview

Summary

Strong recent profitability (low-to-mid teens net margins; improved EBIT margin) and healthy ROE with moderate leverage support the score, reinforced by premium growth. The main offset is volatile cash generation (negative OCF/FCF in 2022–2023 and sharply lower FCF in 2025 vs. 2024) and some cycle-related earnings/revenue variability.

Income Statement

Profitability is strong and fairly consistent for an insurer, with net margins holding in the low-to-mid teens in recent years (2023–2025) and EBIT margins improving versus 2020. Revenue growth has accelerated meaningfully, highlighted by a very large jump in 2025 versus 2024, following solid growth in 2023–2024. Offsetting this, results have been somewhat volatile over the cycle (notably weaker profitability in 2020 and a sharp revenue decline in 2022), which tempers the overall quality-of-earnings picture.

Balance Sheet

Leverage appears moderate for the business, with debt-to-equity generally around ~0.47–0.56 and improving from the higher level seen in 2020. Equity has grown over time, and returns on equity have been healthy in recent years (mid-to-high teens and occasionally ~20%), indicating solid value creation. The key drawback is that debt has also risen in absolute terms alongside growth, so while leverage is reasonable, the capital structure still requires disciplined underwriting/investment performance to remain resilient through downturns.

Cash Flow

Cash generation is mixed and more volatile than earnings. Operating and free cash flow were strong in 2024–2025, but 2022–2023 show significant negative free cash flow (and negative operating cash flow in both years), indicating periods where cash generation did not track reported profitability. Additionally, 2025 free cash flow fell sharply versus 2024, suggesting variability in cash conversion and reinvestment needs typical of insurance balance sheet movements.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	30.41B	28.45B	25.80B	19.58B	25.80B
Gross Profit	6.59B	5.57B	5.23B	-104.30M	12.27B
EBITDA	8.05B	7.04B	7.31B	6.03B	5.84B
Net Income	4.77B	3.87B	4.38B	3.37B	3.40B
Balance Sheet
Total Assets	107.59B	96.78B	91.99B	92.13B	86.65B
Cash, Cash Equivalents and Short-Term Investments	11.68B	7.28B	7.96B	11.70B	25.34B
Total Debt	14.83B	13.06B	10.80B	9.32B	7.75B
Total Liabilities	76.77B	68.43B	64.28B	71.79B	65.33B
Stockholders Equity	26.47B	24.07B	22.95B	16.68B	16.39B
Cash Flow
Free Cash Flow	2.40B	3.59B	-553.50M	-4.84B	6.29B
Operating Cash Flow	2.99B	3.99B	-39.40M	-4.42B	6.64B
Investing Cash Flow	-702.28M	-1.32B	92.00M	384.80M	1.84B
Financing Cash Flow	-1.69B	-1.56B	-1.07B	-1.29B	-1.19B

Fairfax Financial Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2383.93
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:FFH, the sentiment is Positive. The current price of 2383.93 is above the 20-day moving average (MA) of 2318.78, above the 50-day MA of 2344.79, and above the 200-day MA of 2375.15, indicating a bullish trend. The MACD of 6.75 indicates Negative momentum. The RSI at 57.77 is Neutral, neither overbought nor oversold. The STOCH value of 83.80 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:FFH.

Fairfax Financial Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IFC	74 Outperform	C$44.43B	15.12	16.27%	1.86%	2.51%	44.44%
FFH	72 Outperform	$51.13B	8.56	18.65%	0.84%	10.08%	24.18%
IAG	72 Outperform	C$13.30B	15.09	14.34%	2.11%	-25.13%	16.40%
SLF	69 Neutral	$47.27B	12.88	14.68%	4.11%	-19.88%	-13.92%
DFY	68 Neutral	C$8.07B	21.30	13.44%	0.98%	19.80%	-12.93%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
GWO	65 Neutral	C$56.90B	15.18	13.98%	3.62%	-20.64%	14.88%

Fairfax Financial Holdings Corporate Events

Fairfax to Sell Half Its Poseidon Stake for US$1.9 Billion While Retaining Strategic Holding

Fairfax Financial Holdings has agreed to sell about half of its stake in Poseidon Corp., the parent of container-ship owner Seaspan, for roughly US$1.91 billion, offloading 67.6 million shares at US$28.30 each to one existing shareholder and two new strategic investors. The sale, which will cut Fairfax’s Poseidon common equity interest to about 22.1% while leaving its preferred stake in Atlas Corp. intact, is set to close in the second quarter of 2026 and is expected to bring in fresh strategic capital for Poseidon as it expands its role as an independent maritime asset owner and operator.

Fairfax plans to continue using the equity method to account for its Poseidon holding after the transactions, underscoring that it still views the shipping group as a long-term investment despite monetizing a significant portion of its position. The move highlights Fairfax’s capital allocation flexibility and could signal a rebalancing of its investment portfolio, while broadening Poseidon’s investor base alongside existing partner Ocean Network Express to support further growth in the global maritime transport market.

The most recent analyst rating on (TSE:FFH) stock is a Hold with a C$2600.00 price target. To see the full list of analyst forecasts on Fairfax Financial Holdings stock, see the TSE:FFH Stock Forecast page.

Fairfax Raises C$650 Million in Senior Notes to Boost Financial Flexibility

Fairfax Financial Holdings has completed a C$650 million senior notes offering, comprising C$400 million of 4.40% notes due 2036 and an additional C$250 million of 5.10% notes due 2055, bringing that longer-dated series to C$550 million outstanding. The unsecured notes, placed through a syndicate of major dealers, strengthen Fairfax’s funding flexibility and extend its debt maturity profile.

The company plans to use the proceeds to refinance or redeem existing debt and other obligations, pursue potential acquisitions or investments, and for general corporate purposes, including bolstering holding-company liquidity. This capital raise enhances Fairfax’s ability to manage its balance sheet, support strategic transactions, and maintain a strong cash and investment position in a competitive insurance and reinsurance market.

The most recent analyst rating on (TSE:FFH) stock is a Hold with a C$2600.00 price target. To see the full list of analyst forecasts on Fairfax Financial Holdings stock, see the TSE:FFH Stock Forecast page.

Fairfax to Raise C$650 Million in New and Tap 2055 Senior Notes

Fairfax Financial Holdings has launched a C$650 million senior notes offering, comprising C$400 million of new 4.40% unsecured notes due 2036 and C$250 million of additional 5.10% unsecured notes due 2055, to be sold through a syndicate of major Canadian and international dealers. The additional 2055 notes will form a single series with Fairfax’s existing C$300 million 2055 issue, expanding the company’s long-dated debt profile and further tapping investor appetite for its investment-grade credit.

The company plans to use the proceeds to refinance, repay or redeem existing debt and other obligations, pursue potential acquisitions or investments, and for general corporate purposes, including bolstering holding company liquidity. The move gives Fairfax added flexibility to manage its capital structure and fund future growth opportunities, while potentially reducing financing costs and optimizing its mix of short- and long-term funding, subject to market conditions and customary closing requirements.

The most recent analyst rating on (TSE:FFH) stock is a Hold with a C$2600.00 price target. To see the full list of analyst forecasts on Fairfax Financial Holdings stock, see the TSE:FFH Stock Forecast page.

Fairfax-Backed Management Consortium to Take Kennedy Wilson Private in $10.90-a-Share Deal

Kennedy-Wilson Holdings has agreed to be acquired in an all-cash deal by a consortium led by Chairman and CEO William McMorrow and other senior executives, alongside Fairfax Financial. The transaction values the company at $10.90 per share, a 46% premium to its unaffected November 4, 2025, share price, and will see Fairfax provide up to $1.65 billion in funding, giving it a majority economic interest while management retains operational control.

The board approved the merger following a unanimous recommendation from a special committee of independent directors, and the deal is expected to close in the second quarter of 2026, subject to shareholder and regulatory approvals. Upon completion, Kennedy Wilson will be taken private, its shares delisted from the New York Stock Exchange, and it may continue to pay limited quarterly dividends until investor approvals are secured, marking a significant ownership and capital structure shift for the real estate investor and its stakeholders.

The most recent analyst rating on (TSE:FFH) stock is a Buy with a C$2586.00 price target. To see the full list of analyst forecasts on Fairfax Financial Holdings stock, see the TSE:FFH Stock Forecast page.

Fairfax Financial Declares US$15 Annual Dividend, Stresses No Guidance for Future Payouts

Fairfax Financial Holdings has declared an annual dividend of US$15.00 per share on its multiple voting and subordinate voting shares, payable on January 22, 2026 to shareholders of record as of January 15, 2026, with Canadian withholding tax applicable to non-resident investors. The dividend level, set in line with Fairfax’s customary practice, reflects the current operating results of its insurance and reinsurance businesses and the holding company’s cash position, and the company cautions that the payout should not be seen as a guide to future dividends, underscoring a flexible capital allocation approach that may affect shareholder income expectations year to year.

The most recent analyst rating on (TSE:FFH) stock is a Buy with a C$2872.00 price target. To see the full list of analyst forecasts on Fairfax Financial Holdings stock, see the TSE:FFH Stock Forecast page.