Fairfax Financial Holdings Limited is a financial services holding company whose corporate objective is to achieve a high rate of return on invested capital and build long term shareholder value.
Period: Q1 2014
Portfolio date: 31 Mar 2014
No. of stocks: 41
Portfolio value: $1,411,671,000
* Reported Price is the price of the security as of the portfolio date. This value is significant in that it indicates the portfolio manager's confidence in the stock at that price and suggests at least some level of undervaluation or margin of safety.
Sector % analysis
Articles & Commentaries
Throwing good money after bad?
A turnaround at Research In Motion Ltd. (RIM) may take three to five years and the BlackBerry maker’s stock is undervalued, one of RIM’s biggest investors said today.
With all due respect to Mr. Watsa, RIM will likely not survive. There may be some value in the company's assets and cash generated in 'wind down' mode. But the real question is, how much of that will flow back to shareholders instead of being squandered on futile 'turnaround' projects!
I have attended the Berkshire Hathaway shareholders’ meeting since there were only 200 shareholders in attendance about 30 years ago. I still find I learn something each year from Warren and Charlie. At the meeting in 2010, I met Bill McMorrow through Alan Parsow, who is a money manager based in Omaha and a great friend. Bill founded Kennedy Wilson, a real estate services and investment company, in 1988, and he now owns 26% of the company. As a result of this meeting, we invested $100 million in a Kennedy Wilson 6% preferred convertible at $12.41 per share, and later purchased $32.5 million of a 6.45% preferred convertible at $10.70 per share and 400,000 common shares at $10.70 per share. Fully diluted we own 18.5% of the company. In 2010 and 2011, we also invested $290 million in several real estate deals with Kennedy Wilson in California, Japan and the U.K. – deals at significant discounts to replacement cost and with excellent unlevered cash on cash returns, in which Kennedy Wilson is the managing partner and a minority investor. We are thrilled to be partners with Bill and his team, who always focus on the downside and have the expertise to manage these investments and finally harvest them. You never know what you will find at a Berkshire meeting!! ...
Mr. Watsa, Fairfax, and other companies related to them bought 6,499,500 shares of RIM on Wednesday and an additional 7,550,700 on Thursday, according to filings with U.S. securities regulators.
Prem Watsa, who patterns his value investments after Warren Buffett, said his Canadian insurance company may buy more shares of Research In Motion Ltd. after Watsa was appointed to the board of the BlackBerry maker.
“We are very pleased to acquire such a pre-eminent retailer as Sporting Life,” said Prem Watsa, chief executive officer of Fairfax. “Today’s acquisition is consistent with our ongoing interest in acquiring strong, established franchises from entrepreneurial founders who want to find a long-term home for their business.”
"For the past 25 years, the book value of Prem Watsa's Fairfax Financials has compounded a cumulative 24,424%, versus 979.7% for the S&P500," says Jacob Wolinsky, who is the vice-president of business development for SumZero LLC, the world's largest community of buy-side analysts. "His performance is spectacular and he ranks among the best investors in Canada and in the world."
But it isn’t just the United States and Europe that Prem Watsa is worried about. The potential bursting of a property bubble in China has him even more concerned. And if Chinese demand for commodities dries up at the same time as U.S. consumers are shutting their wallets, then the global economy is in for a lengthy period of pain.
(Reuters) - Canada's Fairfax Financial Holdings is leading a group of investors who have agreed to pay 1.1 billion euro ($1.6 billion) for a stake of up to 37 percent in Bank of Ireland , Irish media reported on Tuesday.
"The underlying fundamentals are there for everyone to see, but it's boring... No one wants to buy something that will take five, six years to double in value."