Fairfax Financial wins price target raise at RBC

RBC Dominion Securities analyst Bart Dziarski raised his target on Fairfax Financial Holdings  (Fairfax Financial Holdings Stock Quote, Chart, News, Analysts, Financials TSX:FFH) to US$2,277 from US$2,261, maintaining an “Outperform” rating and calling the stock his top value pick after what he viewed as in-line first-quarter results.

“FFH stock’s 8% decline following Q1/26 results, which we viewed as in-line, was the single-biggest one-day decline since Liberation Day in April 2025 and the February 2024 short report on the name,” Dziarski said. “Both turned out to be great buying opportunities and we view this time as no different.”

Fairfax reported first-quarter net earnings of $695.7-million, down from $945.7-million a year earlier, as stronger P&C underwriting was offset by investment losses tied mainly to higher interest rates.

The company’s P&C insurance and reinsurance operations produced adjusted operating income of $1.21-billion, up from $685.5-million a year earlier. Underwriting profit rose to $381.6-million from $96.9-million, while the consolidated undiscounted combined ratio improved to 94.1% from 98.5%, helped by lower catastrophe losses and volume growth.

Net premiums written rose 4.2% to $7.06-billion, while gross premiums written increased 4.1% to $8.81-billion. Catastrophe losses fell to $119.3-million from $781.3-million a year earlier, when results were affected by the California wildfires.

As reported by the Globe and Mail, Dziarski said Fairfax’s balance sheet remains strong, with $2.5-billion in cash and a 27% leverage ratio. He said the stock remains overly discounted at 1.1x forward price-to-book. His US$2,277 target is based on 1.5x his second-quarter 2027 estimated book value per share.

Book value per basic share was US$1,250.14 at March 31, compared with US$1,260.19 at the end of 2025. Fairfax said book value increased 0.5% after adjusting for the US$15-per-share dividend paid in the quarter.

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