Fairfax Monetary Holdings (TSX:FFH) isn’t only a sturdy performer — it’s been a market-crushing machine. Regardless of buying and selling close to all-time highs, I consider this inventory nonetheless gives compelling upside for long-term traders. Right here’s why it’s price your consideration, even after such an enormous run.

Crushing the market — yr after yr

Fairfax has constructed a unprecedented observe file. Over the previous decade, the corporate has delivered annualized returns of 17.3%, turning a $10,000 funding into roughly $49,290. In distinction, the broader Canadian market — as represented by iShares S&P/TSX 60 Index ETF — returned simply 11.7% over the identical interval, rising that very same $10,000 to about $30,280.

Much more impressively, within the final 5 years, Fairfax inventory has exploded with compound annual returns of 47%. A $10,000 funding in 2020 can be price roughly $69,600 at the moment, far outpacing the market’s 16.4% annual return, which grew to simply $21,370.

So, what’s powering these good points? It’s not luck — Fairfax is executing brilliantly throughout a number of fronts.

A number of development engines firing

The corporate’s core property and casualty (P&C) insurance coverage enterprise is performing exceptionally effectively, with sturdy underwriting income offering a rock-solid basis. Within the first half of 2025, Fairfax reported internet premiums written of US$14.1 billion — a 6.8% enhance yr over yr. Its internet insurance coverage income grew by 4.3%, reaching US$12.6 billion.

However Fairfax’s energy doesn’t cease at insurance coverage. Its diversified portfolio is reaping the advantages of upper rates of interest, bringing in virtually US$1.1 billion in curiosity and dividends in simply six months — a 4.6% enhance yr over yr. 

Its value-focused capital allocation technique additionally provides to the attraction: the corporate doesn’t overpay and invests in alternatives that provide long-term upside. Right here’s an instance: its latest acquisition of a 33% stake in French insurer Albingia to additional broaden globally.

All of this helps constant development in ebook worth per share, which has surged 150% in simply 5 years — a stable indicator of intrinsic worth creation.

Sturdy financials, room to run

Fairfax’s monetary place is as sturdy as ever. The corporate holds an A- credit standing from S&P, has greater than US$3.0 billion in money and marketable securities, and owns an extra US$1.9 billion in investments in associates and non-insurance companies.

At round $2,400 per share at the moment, Fairfax could not look low-cost at first look. However analysts peg the inventory’s truthful worth nearer to $2,669, suggesting a roughly 10% low cost (or about 11% upside from present ranges). 

For a corporation with this sort of consistency, steadiness sheet energy, and long-term efficiency, that’s a uncommon alternative — even close to all-time highs.

Investor takeaway: A purchase on energy. Add on weak point

Sure, Fairfax has already delivered unimaginable returns. However this isn’t a case of “you missed it.” With disciplined administration, international enlargement, rising funding revenue, and a fortress steadiness sheet, Fairfax nonetheless has room to develop.

Lengthy-term traders could contemplate beginning a place now, particularly inside a Tax-Free Financial savings Account or Registered Retirement Financial savings Plan for tax-efficient compounding. Some platforms, like Wealthsimple, supply the aptitude to buy partial shares with no fee charge. If the market pulls again, that would current a golden alternative so as to add on weak point.

Fairfax isn’t only a top-notch Canadian inventory — it’s a top-notch enterprise. And regardless of buying and selling close to its highs, I nonetheless suppose it’s a purchase.