11:31 AM EDT, 07/29/2022 (MT Newswires) -- National Bank Financial's Jaeme Gloyn has a positive view on Fairfax Financial's Q2 2022 results.
Key takeaways:
1) profitably growing the top line at a rapid rate: GPW up 22% and combined ratio of 94% in Q2 2022,
2) massive gains forthcoming exceed net investments losses booked in Q2-22,
3) non-insurance associates and consolidated subsidiaries continue to deliver income upside.
"Although one of the best performing Financials stocks YTD, FFH remains the best value idea in our coverage universe. Still trading below book value at ~0.9x, the market is pricing FFH at an ROE of ~7%. We believe FFH can deliver sustainable long-run ROE of at least 10% through a combination of consistently strong underwriting growth/profits and improving total investment return performance. We apply a ~1.1x P/ B multiple on our Q2-23 estimate (plus 1.0x AOCI) to arrive at our $1,050 price target."
Maintain Outperform.
Price: 692.22, Change: +1.65, Percent Change: +0.24