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  5. FFH: Can you contrast the business models of INtact financial and Fairfax financial holdings and discuss valuation and which uoid prefer thanks? [Fairfax Financial Holdings Limited Subordinate Voting Shares]
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Q: Can you contrast the business models of INtact financial and Fairfax financial holdings and discuss valuation and which uoid prefer thanks? Why such a large PE discount for fair fax? Why have both somewhat underperformed of late but done well longterm?
Asked by Scott on May 07, 2026
5i Research Answer:

FFH is more of an investment holding company that has an insurance arm to provide additional leverage to compound capital internally at a faster rate. As a result, FFH tends to trade at a slight to moderate premium Price/Book valuation. For instance, FFH used to trade in the range of 0.8x–1.6x Price/Book. The business model is mostly focused on compounding capital.

On the other hand, IFC’s business model resembles that of a pure insurance company, with a primary focus on growing premiums and gradually rewarding shareholders through dividend growth over time. Historically, IFC has traded in the range of 2.1x–2.5x Price/Book, and the company is currently trading at the lower end of those valuation multiples. Overall, we are comfortable holding both names, and we think the two are trading at reasonable valuations and could do well from the current levels.

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