Comparing Third Point Reinsurance (NYSE:TPRE) and Fairfax Financial Holdings Ltd Subordinate Voting Shares (NYSE:FRFHF)

Third Point Reinsurance (NYSE:TPRE) and Fairfax Financial Holdings Ltd Subordinate Voting Shares (OTCMKTS:FRFHF) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, profitability, dividends, valuation and earnings.

Dividends

Fairfax Financial Holdings Ltd Subordinate Voting Shares pays an annual dividend of $10.00 per share and has a dividend yield of 2.3%. Third Point Reinsurance does not pay a dividend.

Analyst Recommendations

This is a summary of recent ratings for Third Point Reinsurance and Fairfax Financial Holdings Ltd Subordinate Voting Shares, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Third Point Reinsurance 0 1 0 0 2.00
Fairfax Financial Holdings Ltd Subordinate Voting Shares 0 0 1 0 3.00

Third Point Reinsurance presently has a consensus target price of $13.00, suggesting a potential upside of 27.83%. Given Third Point Reinsurance’s higher possible upside, analysts plainly believe Third Point Reinsurance is more favorable than Fairfax Financial Holdings Ltd Subordinate Voting Shares.

Volatility and Risk

Third Point Reinsurance has a beta of 1.07, meaning that its share price is 7% more volatile than the S&P 500. Comparatively, Fairfax Financial Holdings Ltd Subordinate Voting Shares has a beta of 0.58, meaning that its share price is 42% less volatile than the S&P 500.

Insider & Institutional Ownership

65.3% of Third Point Reinsurance shares are owned by institutional investors. Comparatively, 0.9% of Fairfax Financial Holdings Ltd Subordinate Voting Shares shares are owned by institutional investors. 9.2% of Third Point Reinsurance shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Third Point Reinsurance and Fairfax Financial Holdings Ltd Subordinate Voting Shares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Third Point Reinsurance N/A -9.20% -3.74%
Fairfax Financial Holdings Ltd Subordinate Voting Shares 4.53% 4.58% 1.12%

Valuation & Earnings

This table compares Third Point Reinsurance and Fairfax Financial Holdings Ltd Subordinate Voting Shares’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Third Point Reinsurance $370.01 million 2.58 -$317.69 million ($3.27) -3.11
Fairfax Financial Holdings Ltd Subordinate Voting Shares $17.76 billion 0.69 $376.00 million N/A N/A

Fairfax Financial Holdings Ltd Subordinate Voting Shares has higher revenue and earnings than Third Point Reinsurance.

Summary

Fairfax Financial Holdings Ltd Subordinate Voting Shares beats Third Point Reinsurance on 9 of the 14 factors compared between the two stocks.

Third Point Reinsurance Company Profile

Third Point Reinsurance Ltd., through its subsidiaries, provides specialty property and casualty reinsurance products to insurance and reinsurance companies worldwide. It underwrites homeowners' and commercial, workers' compensation, personal automobile, mortgage, and multi-line reinsurance products; professional, transactional, and general liability reinsurance products; and marine, travel, and extended warranty reinsurance products. The company was incorporated in 2011 and is based in Pembroke, Bermuda.

Fairfax Financial Holdings Ltd Subordinate Voting Shares Company Profile

Fairfax Financial Holdings Limited, through its subsidiaries, provides property and casualty insurance and reinsurance, and investment management services in the United States, Canada, Asia, and internationally. The company also underwrites specialty insurance and reinsurance; develops, produces, markets, and distributes television programs; and franchises, owns, and operates dining restaurants and holiday resorts. In addition, it is involved in the provision of pet medical insurance and database services; retail of tableware and gifts, and home improvement goods, as well as sporting goods and sports apparel comprising golf equipment, consumables, and athletic apparel and accessories; investment of real estate; and provision of integrated travel and travel-related financial services. The company was formerly known as Markel Financial Holdings Limited and changed its name to Fairfax Financial Holdings Limited in 1987. Fairfax Financial Holdings Limited was founded in 1951 and is headquartered in Toronto, Canada.

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