Fairfax Financial Holdings Limited
Fairfax Financial Holdings Limited Fundamental Analysis
Fairfax Financial Holdings Limited (FRFGF) shows moderate financial fundamentals with a PE ratio of 0.12, profit margin of 26.33%, and ROE of 8.72%. The company generates $630.0B in annual revenue with weak year-over-year growth of -10.64%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 48.5/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze FRFGF's fundamental strength across five key dimensions:
Efficiency Score
WeakFRFGF struggles to generate sufficient returns from assets.
Valuation Score
ExcellentFRFGF trades at attractive valuation levels.
Growth Score
WeakFRFGF faces weak or negative growth trends.
Financial Health Score
ExcellentFRFGF maintains a strong and stable balance sheet.
Profitability Score
ModerateFRFGF maintains healthy but balanced margins.
Key Financial Metrics
Is FRFGF Expensive or Cheap?
P/E Ratio
FRFGF trades at 0.12 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, FRFGF's PEG of 0.01 indicates potential undervaluation.
Price to Book
The market values Fairfax Financial Holdings Limited at 0.01 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 4.30 times EBITDA. This is generally considered low.
How Well Does FRFGF Make Money?
Net Profit Margin
For every $100 in sales, Fairfax Financial Holdings Limited keeps $26.33 as profit after all expenses.
Operating Margin
Core operations generate 35.69 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $8.72 in profit for every $100 of shareholder equity.
ROA
Fairfax Financial Holdings Limited generates $2.12 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Fairfax Financial Holdings Limited produces operating cash flow of $113.15B, showing steady but balanced cash generation.
Free Cash Flow
Fairfax Financial Holdings Limited generates strong free cash flow of $95.03B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $73.51 in free cash annually.
FCF Yield
FRFGF converts 6.00% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
0.12
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.01
vs 25 benchmark
P/B Ratio
Price to book value ratio
0.01
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.52
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.51
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.10
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.09
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
0.03
vs 25 benchmark
How FRFGF Stacks Against Its Sector Peers
| Metric | FRFGF Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 0.12 | 18.59 | Better (Cheaper) |
| ROE | 8.72% | 801.00% | Weak |
| Net Margin | 26.33% | -498.00% (disorted) | Strong |
| Debt/Equity | 0.51 | 0.98 | Strong (Low Leverage) |
| Current Ratio | 1.10 | 661.40 | Neutral |
| ROA | 2.12% | -21324.00% (disorted) | Weak |
FRFGF outperforms its industry in 3 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Fairfax Financial Holdings Limited's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
61.48%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
132.48%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
254.30%
Industry Style: Value, Dividend, Cyclical
High Growth