Fairfax Financial Holdings (FFH) AI Stock Analysis

• Market Cap: C$52.65B
• Dividend Yield: 0.84%
• Average Volume (3M): 111.04K
• Price to Earnings (P/E): 7.4
• Beta (1Y): 0.66
• Revenue Growth: 10.08%
• EPS Growth: 24.18%
• Country: CA
• Employees: 47,040
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Property & Casualty
• EPS (TTM): 70.89
• Shares Outstanding: 21,880,169
• 10 Day Avg. Volume: 131,564
• 30 Day Avg. Volume: 111,043
• PEG Ratio: 6.45
• Price to Book (P/B): 1.29
• Price to Sales (P/S): 1.09
• P/FCF Ratio: 8.67
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$2,886.85
• Price Target Upside: 28.47% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 81 Outperform
• Price Target: C$2,595.00 ▲(15.48% Upside)

Fairfax Financial Holdings demonstrates strong financial performance, supported by robust earnings and a solid balance sheet. The positive technical indicators and attractive valuation further enhance the stock's appeal. The recent earnings call provided additional confidence with strong financial results and strategic growth initiatives, despite some challenges in specific segments.

Positive Factors

Underwriting & investment performance

Sustained underwriting profitability (combined ratio ~92%) plus sizable investment gains indicate Fairfax’s core insurance operations and portfolio management generate recurring earnings and surplus. This dual income base supports long-term capital accumulation and underwriting capacity across cycles.

Healthy balance sheet and ROE

Moderate leverage with a 0.51 debt/equity and strong 18.6% ROE reflect prudent capital structure and efficient equity use. This combination improves solvency resilience, supports rating upgrades, and preserves capacity to underwrite risks and pursue acquisitions over the medium term.

Strong free cash flow conversion

High FCF growth and near-1.0 conversion of net income into free cash flow signal robust cash generation from operations and investments. Durable cash conversion underpins reinvestment, opportunistic asset purchases, dividends, and bolsters balance sheet flexibility across interest-rate cycles.

Negative Factors

Revenue growth slowdown

A noticeable deceleration in top-line growth suggests pressure on new premium generation or pricing in some lines. Over several quarters, slower premium growth can constrain scale economics, limit investment asset growth, and reduce room for margin expansion absent operational gains.

Rising leverage ratio

An upward trend in debt-to-capital modestly reduces financial flexibility and increases fixed obligations. If sustained, higher leverage can limit capacity for opportunistic investments or acquisitions and raise vulnerability to higher funding costs in a rising-rate environment.

Interest-rate sensitivity

Material mark-to-market losses from rate movements highlight duration and repricing mismatches between assets and insurance liabilities. This structural sensitivity can compress earnings and capital during rate shocks, complicating reserve and investment strategies over multi-quarter horizons.

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

Fairfax Financial Holdings generates revenue primarily through its insurance and reinsurance operations. The company earns premiums from policyholders in exchange for providing coverage against various risks. The underwriting process involves assessing risks and setting premium rates, which can vary significantly based on the type of coverage provided. Furthermore, FFH invests the premiums it receives in a wide range of financial instruments, including stocks, bonds, and other securities, generating investment income. Key revenue streams include underwriting profits from its insurance operations and investment income from its diversified asset portfolio. The company's financial performance is also bolstered by strategic partnerships with other firms in the insurance and investment sectors, as well as its ability to navigate market conditions effectively to maximize returns.

Fairfax Financial Holdings Financial Statement Overview

Summary

Fairfax Financial Holdings exhibits strong financial health with solid profitability and cash flow metrics. The company maintains a stable balance sheet with moderate leverage and efficient equity utilization. However, the revenue growth has slowed, which slightly tempers the overall financial performance score.

Income Statement

Fairfax Financial Holdings shows strong profitability with a TTM gross profit margin of 20.62% and a net profit margin of 14.61%. The EBIT and EBITDA margins are robust at 22.48% and 25.37%, respectively. However, the revenue growth rate has declined by 1.62% in the TTM, indicating a potential slowdown in revenue generation.

Balance Sheet

The company maintains a healthy balance sheet with a debt-to-equity ratio of 0.51, indicating moderate leverage. The return on equity is strong at 18.64%, reflecting efficient use of equity to generate profits. The equity ratio is not explicitly provided, but the overall financial stability appears solid.

Cash Flow

Fairfax Financial Holdings demonstrates strong cash flow management with a significant free cash flow growth rate of 42.06% in the TTM. The free cash flow to net income ratio is 0.88, indicating effective conversion of net income into free cash flow. However, the operating cash flow to net income ratio is not available, which limits a full assessment of cash flow efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	30.74B	28.45B	25.80B	19.58B	25.80B	19.86B
Gross Profit	6.34B	5.57B	5.23B	-104.30M	12.27B	8.18B
EBITDA	7.99B	7.04B	7.31B	6.03B	5.84B	1.47B
Net Income	5.12B	3.87B	4.38B	3.37B	3.40B	218.40M
Balance Sheet
Total Assets	147.98B	96.78B	91.99B	92.13B	86.65B	74.05B
Cash, Cash Equivalents and Short-Term Investments	11.43B	7.28B	7.96B	11.70B	25.34B	16.30B
Total Debt	19.26B	13.06B	10.80B	9.32B	7.75B	8.81B
Total Liabilities	105.67B	68.43B	64.28B	71.79B	65.33B	56.53B
Stockholders Equity	36.44B	24.07B	22.95B	16.68B	16.39B	13.86B
Cash Flow
Free Cash Flow	4.77B	3.59B	-553.50M	-4.84B	6.29B	-133.50M
Operating Cash Flow	5.46B	3.99B	-39.40M	-4.42B	6.64B	139.80M
Investing Cash Flow	-1.62B	-1.32B	92.00M	384.80M	1.84B	-46.80M
Financing Cash Flow	-726.47M	-1.56B	-1.07B	-1.29B	-1.19B	436.90M

Fairfax Financial Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2247.13
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:FFH, the sentiment is Negative. The current price of 2247.13 is below the 20-day moving average (MA) of 2425.33, below the 50-day MA of 2435.75, and below the 200-day MA of 2352.12, indicating a bearish trend. The MACD of -66.24 indicates Positive momentum. The RSI at 32.23 is Neutral, neither overbought nor oversold. The STOCH value of 14.28 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:FFH.

Fairfax Financial Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FFH	81 Outperform	C$52.65B	7.44	18.65%	0.84%	10.08%	24.18%
DFY	79 Outperform	C$8.10B	16.30	13.44%	0.98%	19.80%	-12.93%
GWO	78 Outperform	C$57.77B	14.70	15.09%	3.62%	-20.64%	14.88%
IFC	73 Outperform	C$44.21B	14.83	16.27%	1.86%	2.51%	44.44%
IAG	71 Outperform	C$15.35B	14.29	14.34%	2.11%	-25.13%	16.40%
SLF	68 Neutral	C$47.83B	16.27	11.96%	4.11%	-19.88%	-13.92%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Fairfax Financial Holdings Corporate Events

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.

Fairfax Financial Sells 25 Million Orla Shares in Strategic Portfolio Rebalancing

Fairfax Financial Holdings Limited announced the sale of 25 million common shares of Orla Mining Ltd., generating approximately CDN$441.1 million. This transaction is part of Fairfax’s investment portfolio rebalancing strategy, reducing its stake in Orla from 16.7% to 9.4% on a non-diluted basis. The move reflects Fairfax’s ongoing investment strategy to adapt to market changes and optimize its holdings, potentially impacting its influence in Orla’s future operations.

The most recent analyst rating on (TSE:FFH) stock is a Buy with a C$2791.00 price target. To see the full list of analyst forecasts on Fairfax Financial Holdings stock, see the TSE:FFH Stock Forecast page.

Fairfax Financial to Redeem Preferred Shares, Series I & J

Fairfax Financial Holdings Limited has announced its intention to redeem all outstanding Cumulative Preferred Shares, Series I and J, on December 31, 2025, at a redemption price of C$25.00 per share, totaling C$300.0 million. This redemption will result in the delisting of these shares from the Toronto Stock Exchange, impacting the company’s capital structure and potentially influencing its financial strategy and stakeholder interests.

The most recent analyst rating on (TSE:FFH) stock is a Buy with a C$2791.00 price target. To see the full list of analyst forecasts on Fairfax Financial Holdings stock, see the TSE:FFH Stock Forecast page.