Fairfax Financial: Canada's Hidden Gem

Newcomer Investor

Welcome to the Newcomer Investor Channel, where we uncover the story behind great businesses and make investing accessible and fun for everyone!

In this episode, I am joined by Asheef Lalani for an in-depth analysis of Fairfax!

Please note, this conversation was recorded on November 4th. As a result, any references to specific future dates/events in the episode may refer to a time that has already passed. And remember that nothing here is financial advice

Connect:

Newcomer Investor on X:⁠ ⁠⁠https://twitter.com/NewcomerInvest⁠⁠⁠

Newcomer Investor Email: ⁠⁠[e-mail]⁠⁠

Asheef on X:

https://x.com/BrownMarubozu

Episode Highlights:

(0:00) - Intro

(1:45) - Asheef’s career in finance

(5:00) - Asheef’s investing style

(7:50) - The evolution of markets

(18:45) - Fairfax - what do they do? what is a p&c business?

Who is Prem Watsa? What is the Fairfax culture?

(27:20) - Fairfax’ largest stock: Eurobank

(29:45) - Understanding Fairfax’ valuation and some of its “hidden” components

(36:45) - Breaking down Fairfax’ insurance business

(41:55) - Downside protection

(47:27) - The float!!!

(49:20) - Global diversification

(53:25) - Fairfax India

(1:05:20) - Book value - comparison with Intact

(1:08:00) - genius move: Fairfax’ Total Return Swaps

(1:12:50) - catalyst: Fairfax’ potential inclusion into the TSX 60

(1:19:00) - How all Fairfax segments come together

(1:20:30) - Brookfield & Fairfax similarities

(1:22:00) - Fairfax vs Fairfax India

(1:26:00) - Fairfax Stock: Strathcona Resources

(1:43:00) - Mako Mining and execution risks

(1:47:00) - Fairfax recent acquisitions: Sleep Country Canada and Peak Achievement

(1:58:45) - Fairfax stock’s exceptional return

(2:00:00) - Stock splits

(2:08:45) - Why some people choose to avoid Fairfax (and Brookfield!)

(2:12:30) - How Prem treats people

(2:17:00) - Asheef’s advice to investors