Fairfax Financial Holdings Limited

Fairfax Financial Holdings Limited (TSX: FFH) is a holding company. The Company, through its subsidiaries, is engaged in property and casualty insurance and reinsurance and the associated investment management.

Why should investors book profit?

• Increasing uncertainties: The resurgence of COVID-19 cases is throwing a lot of uncertainties over the global financial markets. This can impact Fairfax Financial Holdings Limited’s investment portfolio in short run as company invests in global equity as well in debt instruments.
• Claims could increase: On the back of resurgence in the COVID-19 cases, the company could witness increased claims over the next few months, as It happened in the first wave.
• Topping out: On daily price chart FFH shares are facing resistance near current trading level, moreover on the last trading session its shares declined with strong volume and 14-day RSI moved below 60, implies that bears are trying to get control over bulls.

Technical price chart (as on December 17, 2021). Source: REFINITIV, Analysis by Kalkine Group. 

Stock recommendation

The resurgence in the COVID-19 cases across the world has once again creating a lot of uncertainties for a property and casualty insurance companies. Moreover, FFH shares have declined from the peak with above average volume. Hence, we recommend a “Sell” rating on FFH stock at CAD 583.53 (as on December 17, 2021)

 1-Year price chart (as on December 17, 2021,) Source: REFINITIV, Analysis by Kalkine Group

*The reference data in this report has been partly sourced from REFINITIV.

Disclaimer

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