Fairfax Financial Holdings Ltd (FRFHF) is Generating Robust Returns
Alphyn Capital Management, an investment management firm, released its third-quarter 2024 investor letter. A copy of the letter can be downloaded here. The Master Account of the fund returned 8.9% net in the third quarter compared to 5.9% for the S&P500 Index. As of September 30, 2024, the top ten holdings accounted for approximately 71% of the portfolio, and approximately 9% of the portfolio was held in cash. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Alphyn Capital Management highlighted stocks like Fairfax Financial Holdings Limited (OTC:FRFHF) in the third quarter 2024 investor letter. Fairfax Financial Holdings Limited (OTC:FRFHF) provides property and casualty insurance and reinsurance, and investment management services. The one-month return of Fairfax Financial Holdings Limited (OTC:FRFHF) was -1.50%, and its shares gained 45.31% of their value over the last 52 weeks. On October 9, 2024, Fairfax Financial Holdings Limited (OTC:FRFHF) stock closed at $1,209.46 per share with a market capitalization of $30.173 billion.
Alphyn Capital Management stated the following regarding Fairfax Financial Holdings Limited (OTC:FRFHF) in its Q3 2024 investor letter:
"Fairfax Financial Holdings Limited (OTC:FRFHF) continues to demonstrate the ability to generate robust returns from thriving insurance operations and a disciplined investment approach. Fairfax’s insurance operations reported solid underwriting performance, with a combined ratio of 93.9% and positive reserving. It now consolidates Gulf Insurance, which it acquired earlier in the year, and which helped grow net written premiums by 11.5% (3% ex-Gulf). The company has hinted that it has significant opportunities for international growth in insurance.
Peter Clarke, President and COO, remarked during the last earnings call, “We’ve never had this kind of visibility on the investment side, and it puts Fairfax in an excellent position from an earnings and a capital perspective for the next few years.” The investment portfolio currently stands at $66 billion, of which $37 billion is in fixed income, $9 billion in cash and short-term investments, and $20 billion in equities. As the company has evolved in recent years, more of its performance is now driven by insurance and private businesses, with less reliance on fluctuations in marketable securities. Fairfax reiterated its expectation of achieving $4 billion in operating income, derived from interest and dividends, underwriting profits, and contributions from its non-insurance associates. Notable transactions included the $862 million acquisition of Sleep Country Holdings and the sale of Stelco shares to Cleveland-Cliffs, resulting in a $390 million gain. Fairfax also continued its share repurchase program, spending $678 million in the quarter, underscoring management’s belief that its shares remain undervalued despite trading above reported book value."
An experienced property and casualty insurance agent at a client's home, explaining the benefits of the company's homeowners' insurance policies.
Fairfax Financial Holdings Limited (OTC:FRFHF) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 1 hedge fund portfolios held Fairfax Financial Holdings Limited (OTC:FRFHF) at the end of the second quarter which was 1 in the previous quarter. While we acknowledge the potential of Fairfax Financial Holdings Limited (OTC:FRFHF) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Fairfax Financial Holdings Limited (OTC:FRFHF) and shared Alphyn Capital Management's views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q3 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.