Longleaf Partners Fund, a Memphis-based fund under Southeastern Asset Management, published its “Longleaf Partners Fund” fourth quarter 2021 investor letter – a copy of which can be downloaded here. Longleaf Partners Fund added 6.18% in the fourth quarter, taking returns for the full year to 23.58%, well ahead of its absolute return goal. However, the S&P 500 rallied 11.03% in the fourth quarter, taking the index’s full-year returns to 28.71%. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.
Longleaf Partners Fund, in its Q4 2021 investor letter, mentioned Fairfax Financial Holdings Limited (NYSE: FRFHF) and discussed its stance on the firm. Fairfax Financial Holdings Limited is a Toronto, Canada-based insurance company with a $12.2 billion market capitalization. FRFHF delivered a -1.29% return since the beginning of the year, while its 12-month returns are up by 16.86%. The stock closed at $485.78 per share on February 28, 2022.
Here is what Longleaf Partners Fund has to say about Fairfax Financial Holdings Limited in its Q4 2021 investor letter:
“Fairfax Financial Holdings (48%, 2.15%; 23%, 1.05%), the Canadian insurance and investments conglomerate, was a top contributor in the fourth quarter and for the full year. Written premiums are growing well, and CEO Prem Watsa is intelligently delevering the balance sheet with the FCF. Fairfax’s combined ratio came in slightly unprofitably last quarter at 101% due to Hurricane Ida and European flooding, but the underwriting is otherwise improving towards a normalized low-90s combined. Though Fairfax’s investment portfolio did not outperform this year, Watsa made the good decision to end the company’s costly hedging program. After appreciating significantly this year, Fairfax’s 45% stake in digital insurance unicorn Digit is now worth 10% of the company’s market capitalization. The stock should not continue to trade below book value with profitable underwriting, less debt, and a growing investment portfolio. Watsa led a major repurchase effort this year to take advantage of the lingering price to value (P/V) discount.”
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Our calculations show that Fairfax Financial Holdings Limited (NYSE: FRFHF) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. Fairfax Financial Holdings Limited (NYSE: FRFHF) delivered a 9.06% return in the past 3 months. In January 2022, we also shared another hedge fund’s views on FRFHF in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.
Disclosure: None. This article is originally published at Insider Monkey.
