- RBC Capital analyst Mark A. Dwelle raised the price target for Fairfax Financial Holdings FFH FRFHF at $750 from $675.
- The analyst maintained the outperformance rating for equities.
- Dwelle said the hard market continues to deliver strong top line growth and improved underwriting margins, and management has done a great job of protecting book value as interest rates rise, positioning them for better investment results in the future.
- Although the portfolio is still complex, he added that the value positioning seems to be well suited to current market conditions.
- With improving underwriting contributions and a well-positioned balance sheet, the analyst sees significant scope for multiple expansion and sees the company’s shares as a prime value opportunity at around 0.85x book value, a said the analyst.
- The company recently released its first quarter results, with net premiums written by the P&C insurance and reinsurance business increasing 27.8% and gross premiums written improving 21.9%.
- Price action: FFH shares are trading down 7.31% at C$654.26 on the TSX, and FRFHF is down 7.57% at $508.42 when last checked on Monday.
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