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Fairfax Financial Holdings Limited Subordinate Voting Shares (FFH)
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Intact Financial Corporation (IFC)
Can you please comment on the recent quarterly results of both those insurers and a possible reason for the precipitous drop (over $120 i.e 8.5%) in FFH over the previous 2 days?
Thank you for your insights as usual,
FFH reported good results, FFH reported a net premium growth of 11.2% to $6.9B for the quarter. Adjusted operating income grew 22% during the quarter to $1.1B. The company repurchased shares at a more aggressive pace than usual during the quarter for almost $1B, it has been quite some time since the company bought back shares that aggressively in a quarter. The debt-to-capital ratio remains healthy at 25.9%. Expectations were quite high coming to the earnings, also volatility recently also put more pressure on the share price. FFH has performed well recently, given the company’s aggressive buyback which indicates the management believes shares are still attractive.
For IFC, the company reported decent Q2 results, EPS came at $4.86, beating the estimate of $3.48. Revenue growth for the quarter is 6% to $5.3B, missing the consensus estimate of $5.57B. Book value per share grew 15% to $88. Adjusted Return on Equity (ROE) remains healthy, improving to 16.7% from 11.8% in the same quarter last year. The financial position is also solid: debt-to-capital stands around 20%, on par with last year.