Source: The Canadian Press
The chief executive of Fairfax Financial Holdings Ltd. (TSX:FFH) says the company’s investment portfolios will continue to be volatile as worldwide stock markets endure a rough ride though the prevailing economic uncertainty.
Chairman and CEO Prem Watsa told investors during the company’s quarterly conference call Friday that the insurance and investment management firm may have to weather this short-term uncertainty, but he believes Fairfax’s books could reap the rewards.
He says the company has bought a significant amount of high-quality stocks over the past year, half of which could deliver a significant earnings boost over the next five years.
So far this year, Fairfax has picked up a 19.7% stake in Mega Brands Inc. (TSX:MB) as part of a capitalization of the toy company, and acquired Zenith National Insurance Corp.
On Thursday, the company reported a profit of US$290.2 million in the first quarter, compared with a loss a year ago, helped by strong investment gains.
Meanwhile, a report in the Globe and Mail said that Fairfax has decided against bankrolling a bid by newspaper giant Torstar Corp. (TSX:TS.B) to acquire the 46 newspapers owned by Canwest (TSXV:CGS).
Executives did not comment on the rumours in the quarterly conference call.
Fairfax Financial portfolios will be volatile, but payoff could be big: CEO
Watsa expects earnings boost from high quality stocks
- By: The Canadian Press
- April 30, 2010 April 30, 2010
- 09:07