Canada's Fairfax Financial Q3 net earnings fall on investment losses
Overview
Canada property and casualty insurer's Q3 net earnings fell yr/yr on investment losses
Q3 gross premiums written rose 9.3%, led by international segment growth
Outlook
Fairfax expects to close Boots Group acquisition in Q1 2027, investing up to $2.3 bln
Company expects Recipe's Evergood acquisition to close late 2026 or early 2027
Result Drivers
INTERNATIONAL SEGMENT GROWTH - Gross premiums written rose 9.3%, driven by growth in international insurers and reinsurers, particularly at Gulf Insurance
CATASTROPHE LOSSES - Higher catastrophe losses at Northbridge from severe weather events across Canada weighed on underwriting results
INVESTMENT LOSSES - Net losses on investments of $858.7 mln were mainly due to mark-to-market losses on bonds from increased interest rates and unrealized losses on preferred shares
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Gross Premiums | $9.11 bln | ||
Q3 EPS | $43.32 | ||
Q3 Net Income Attributable To Shareholders | $929.6 mln | ||
Q3 Pretax Profit | $1.43 bln |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the property & casualty insurance peer group is "buy"
Wall Street's median 12-month price target for Fairfax Financial Holdings Limited is C$2,925.00, about 17.4% above its November 2 closing price of C$2,490.61
The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 9 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)