Fairfax Financial Holdings (FFH) AI Stock Analysis

• Market Cap: $59.76B
• Dividend Yield: 0.85%
• Average Volume (3M): 62.95K
• Price to Earnings (P/E): 8.4
• Beta (1Y): 0.70
• Revenue Growth: 10.08%
• EPS Growth: 24.18%
• Country: CA
• Employees: 47,040
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Property & Casualty
• EPS (TTM): 71.79
• Shares Outstanding: 21,969,757
• 10 Day Avg. Volume: 69,581
• 30 Day Avg. Volume: 62,948
• 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: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: 0.00
• 1Y Price Target: $2,895.21
• Price Target Upside: 13.94% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6
• EPS Forecast (FY): 273.82
• Revenue Forecast (FY): $46.69B

• Rating: 81 Outperform
• Price Target: C$2,872.00 ▲(13.03% 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

Strong Cash Flow Management

Robust cash flow growth indicates effective financial management and supports future investments and debt servicing, enhancing long-term stability.

International Growth

Expansion in international markets diversifies revenue streams and reduces reliance on any single market, supporting sustainable growth.

Positive Financial Strength Ratings

Upgraded financial strength ratings enhance credibility and can lead to lower borrowing costs, supporting long-term financial health.

Negative Factors

Decline in Gulf Insurance Premiums

A decline in premiums in a key segment could indicate challenges in maintaining market share, potentially affecting revenue stability.

Increased Debt Levels

Rising debt levels may constrain financial flexibility and increase interest obligations, impacting long-term financial resilience.

Impact of Interest Rate Changes

Interest rate fluctuations can adversely affect earnings and investment returns, posing a risk to financial performance and stability.

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 demonstrates strong profitability with a consistent gross profit margin above 80% and a net profit margin improving to 14.61%. The company maintains a moderate debt-to-equity ratio and strong return on equity, indicating effective equity utilization. Cash flow is robust, though there is room for improvement in operating cash flow conversion.

Income Statement

Fairfax Financial Holdings shows strong profitability with a consistent gross profit margin above 80% and a net profit margin improving to 14.61% in TTM. Revenue growth is positive at 4.06% in TTM, indicating a recovery from previous declines. EBIT and EBITDA margins are healthy, reflecting efficient operations.

Balance Sheet

The company maintains a moderate debt-to-equity ratio of 0.51 in TTM, indicating balanced leverage. Return on equity is strong at 18.64%, showcasing effective use of equity to generate profits. The equity ratio is stable, suggesting a solid financial foundation.

Cash Flow

Free cash flow growth is robust at 26.61% in TTM, indicating improved cash generation. However, the operating cash flow to net income ratio is low, suggesting potential challenges in converting income to cash. The free cash flow to net income ratio is strong at 0.88, reflecting good cash profitability.

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: Positive
• Last Price: 2540.97
• 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 2540.97 is above the 20-day moving average (MA) of 2429.43, above the 50-day MA of 2355.64, and above the 200-day MA of 2306.34, indicating a bullish trend. The MACD of 42.72 indicates Negative momentum. The RSI at 68.60 is Neutral, neither overbought nor oversold. The STOCH value of 86.20 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
FFH	81 Outperform	$59.76B	8.41	18.65%	0.85%	10.08%	24.18%
DFY	79 Outperform	C$9.13B	18.37	13.44%	1.00%	19.80%	-12.93%
GWO	76 Outperform	C$60.88B	15.42	15.09%	3.65%	-20.64%	14.88%
IFC	73 Outperform	C$50.60B	16.97	16.27%	1.88%	2.51%	44.44%
IAG	71 Outperform	C$16.12B	14.97	14.34%	2.16%	-25.13%	16.40%
SLF	68 Neutral	C$47.30B	16.09	11.96%	4.15%	-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 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.

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.

Fairfax Financial Holdings to Discuss Q3 Results in Upcoming Conference Call

Fairfax Financial Holdings Limited has announced a conference call scheduled for November 7, 2025, to discuss its third quarter results, which will be released on November 6, 2025. This announcement provides stakeholders with an opportunity to gain insights into the company’s performance and strategic direction, potentially impacting its market positioning and investor relations.

Fairfax Sells Eurolife Life Insurance Stake to Eurobank

Fairfax Financial Holdings Limited has announced the sale of its 80% equity interest in the life insurance business of Eurolife FFH Insurance Group Holdings S.A. to Eurobank for €813 million. This strategic move allows Fairfax to focus on its core operations in property and casualty insurance while maintaining a stake in the life insurance sector through Eurobank. Additionally, Fairfax will acquire a 45% equity interest in Eurobank’s property and casualty insurance business in Cyprus, with an option to increase its stake over time. The transaction is expected to close in the first quarter of 2026, and it positions Fairfax to strengthen its presence in the Greek insurance market.