Fairfax Financial Holdings Stock Return On Equity
| FFH Stock | CAD 1,970 10.78 0.55% |
Fairfax Financial Holdings fundamentals help investors to digest information that contributes to Fairfax Financial's financial success or failures. It also enables traders to predict the movement of Fairfax Stock. The fundamental analysis module provides a way to measure Fairfax Financial's intrinsic value by examining its available economic and financial indicators, including the cash flow records, the balance sheet account changes, the income statement patterns, and various microeconomic indicators and financial ratios related to Fairfax Financial stock.
| Last Reported | Projected for Next Year | ||
| Return On Equity | 0.19 | 0.20 |
Fairfax | Return On Equity |
Fairfax Financial Holdings Company Return On Equity Analysis
Fairfax Financial's Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
Current Fairfax Financial Return On Equity | 0.17 |
Most of Fairfax Financial's fundamental indicators, such as Return On Equity, are part of a valuation analysis module that helps investors searching for stocks that are currently trading at higher or lower prices than their real value. If the real value is higher than the market price, Fairfax Financial Holdings is considered to be undervalued, and we provide a buy recommendation. Otherwise, we render a sell signal.
Fairfax Return On Equity Driver Correlations
Understanding the fundamental principles of building solid financial models for Fairfax Financial is extremely important. It helps to project a fair market value of Fairfax Stock properly, considering its historical fundamentals such as Return On Equity. Since Fairfax Financial's main accounts across its financial reports are all linked and dependent on each other, it is essential to analyze all possible correlations between related accounts. However, instead of reviewing all of Fairfax Financial's historical financial statements, investors can examine the correlated drivers to determine its overall health. This can be effectively done using a conventional correlation matrix of Fairfax Financial's interrelated accounts and indicators.
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For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
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Fairfax Total Stockholder Equity
Total Stockholder Equity |
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Based on the latest financial disclosure, Fairfax Financial Holdings has a Return On Equity of 0.1698. This is 88.29% lower than that of the Insurance sector and significantly higher than that of the Financials industry. The return on equity for all Canada stocks is 154.77% lower than that of the firm.
Fairfax Return On Equity Peer Comparison
Stock peer comparison is one of the most widely used and accepted methods of equity analyses. It analyses Fairfax Financial's direct or indirect competition against its Return On Equity to detect undervalued stocks with similar characteristics or determine the stocks which would be a good addition to a portfolio. Peer analysis of Fairfax Financial could also be used in its relative valuation, which is a method of valuing Fairfax Financial by comparing valuation metrics of similar companies.Fairfax Financial is currently under evaluation in return on equity category among its peers.
Fairfax Financial Current Valuation Drivers
We derive many important indicators used in calculating different scores of Fairfax Financial from analyzing Fairfax Financial's financial statements. These drivers represent accounts that assess Fairfax Financial's ability to generate profits relative to its revenue, operating costs, and shareholders' equity. Below are some of Fairfax Financial's important valuation drivers and their relationship over time.
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 (projected) | ||
| Market Cap | 12.6B | 11.8B | 13.5B | 15.0B | 23.3B | 24.5B | |
| Enterprise Value | 17.0B | 4.3B | (4.1B) | 12.6B | 28.3B | 29.8B |
Fairfax Financial ESG Sustainability
Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Fairfax Financial's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Fairfax Financial's managers, analysts, and investors.Environment Score | Governance Score | Social Score |
Fairfax Fundamentals
| Return On Equity | 0.17 | ||||
| Return On Asset | 0.0418 | ||||
| Profit Margin | 0.12 % | ||||
| Operating Margin | 0.18 % | ||||
| Current Valuation | 49.02 B | ||||
| Shares Outstanding | 21.24 M | ||||
| Shares Owned By Insiders | 3.76 % | ||||
| Shares Owned By Institutions | 38.00 % | ||||
| Number Of Shares Shorted | 154.08 K | ||||
| Price To Earning | 7.75 X | ||||
| Price To Book | 1.40 X | ||||
| Price To Sales | 1.31 X | ||||
| Revenue | 25.8 B | ||||
| Gross Profit | 9.52 B | ||||
| EBITDA | 6.09 B | ||||
| Net Income | 5.09 B | ||||
| Cash And Equivalents | 40.6 M | ||||
| Cash Per Share | 386.73 X | ||||
| Total Debt | 10.8 B | ||||
| Debt To Equity | 0.39 % | ||||
| Current Ratio | 1.86 X | ||||
| Book Value Per Share | 1,033 X | ||||
| Cash Flow From Operations | (39.4 M) | ||||
| Short Ratio | 4.21 X | ||||
| Earnings Per Share | 228.05 X | ||||
| Price To Earnings To Growth | 0.28 X | ||||
| Target Price | 1485.34 | ||||
| Beta | 0.83 | ||||
| Market Capitalization | 44.65 B | ||||
| Total Asset | 91.99 B | ||||
| Retained Earnings | 16.88 B | ||||
| Annual Yield | 0.01 % | ||||
| Five Year Return | 2.28 % | ||||
| Net Asset | 91.99 B | ||||
| Last Dividend Paid | 15.0 |
About Fairfax Financial Fundamental Analysis
The Macroaxis Fundamental Analysis modules help investors analyze Fairfax Financial Holdings's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Fairfax Financial using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Fairfax Financial Holdings based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.
Pair Trading with Fairfax Financial
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Fairfax Financial position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Fairfax Financial will appreciate offsetting losses from the drop in the long position's value.Moving together with Fairfax Stock
The ability to find closely correlated positions to Fairfax Financial could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Fairfax Financial when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Fairfax Financial - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Fairfax Financial Holdings to buy it.
The correlation of Fairfax Financial is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Fairfax Financial moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Fairfax Financial moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Fairfax Financial can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Other Information on Investing in Fairfax Stock
Fairfax Financial financial ratios help investors to determine whether Fairfax Stock is cheap or expensive when compared to a particular measure, such as profits or enterprise value. In other words, they help investors to determine the cost of investment in Fairfax with respect to the benefits of owning Fairfax Financial security.