McElvaine Value Fund on Fairfax Financial Holdings Limited
Thesis
Fairfax Financial is a global property and casualty insurance and investment holding company run by Prem Watsa. The company's book value per share increased during the first half of 2026 while its insurance businesses produced a 93% combined ratio in the second quarter, indicating profitable underwriting. Fairfax also repurchased more than one million shares for approximately $1.7 billion during the half, reducing its share count by around 4.6%. The company realized approximately $1.9 billion from the sale of its Poseidon stake and completed the privatization of Kennedy Wilson. McElvaine views these developments as further strengthening an already high-quality balance sheet and classifies Fairfax's position as improved.
“Book value per share rose during first half.”
Key risks
- Insurance profitability can deteriorate if catastrophe losses or claims experience exceed expectations.
- A substantial portion of value depends on Fairfax's investment and capital-allocation decisions.