Q: Fairfax along with many other insurers have been dropping in price. Could the reason be due to the anticipated decline in interest rates in the months to come. Would you consider the recent recent in the share price of FFH an opportunity to buy?
Thank you.
Thank you.
5i Research Answer:
We had comments on IFC's decline yesterday. Certainly insurers tend to do better with higher rates, but we would not really consider lower rates as 'bad' for the sector. FFH is down 13% YTD but still up 15% in one year. BMO did downgrade the stock last week. At its very low valuation we would consider it a decent buy for long term investors with some patience.