Who are the other nine?

[Eddie Willers]

In the letter to shareholders, Prem said the following:

 

Book value per share has compounded at 25% per year to $379 per share while Fairfax’s stock price has compounded at 21% per year. By the way, this rate of compounding in our stock price over the past 25 years is the best in the property and casualty business (there are only nine public companies with a 25-year track record), second best among all companies in Canada and in the top ten companies in the S&P 500.

 

Does anyone know who the nine public companies are that have a better 25 year track record than Fairfax? 

 

Thanks and best regards,

 

Eddie

 

[Parsad]

Not sure exactly who, but I believe some may be Best Buy, Apple, Microsoft, Oracle, Danaher, Leucadia, Dell & Home Depot.  Cheers!

[Uccmal]

A company has to have existed for 25 years and had a period of time in there where they grew at a rapid clip.  FFH is helped by those first few years.  The last few the returns have been "only" around 20%.

 

I am wondering which Canadian company has beat them?  I am thinking Suncor but am unsure of the duration.  Other possibilites include George Weston, or IGM.

[niels12think]

FFH is helped by those first few years.  The last few the returns have been "only" around 20%.

 

Depends on what you mean by the last few ;)

 

Shown in the table below is Fairfax’s compound growth in book value for the five, ten, fifteen, twenty

and twenty-five years ending December 31, 2010, not including dividends.

 

5 years	10 years	15 years	20 years	25 years
22.5%	9.9%	16.4%	17.6%	24.7%

 

There was not always a dividend, and in the last few years, the dividend been meaningful compared to book.

 

Cheers!

[StubbleJumper]

A company has to have existed for 25 years and had a period of time in there where they grew at a rapid clip.  FFH is helped by those first few years.  The last few the returns have been "only" around 20%.

 

I am wondering which Canadian company has beat them?  I am thinking Suncor but am unsure of the duration.  Other possibilites include George Weston, or IGM.

 

ELF.to ???

[turar]

It seems the sentence is saying that there are 9 public companies with 25 years record, period. Not 9 companies with 25 years record with a higher compounding rate. And they're only talking about P&C companies.

[Uccmal]

There are only 9 P&C companies in NA with a 25 year record...FFH is the best.

FFH is in the top ten S&P 500 companies total, with a comparable record, and one other Canadian company is better.  ELF doesn't fit the bill. 

 

Neils, You are correct.  The years since the dividend particularly the last 3 have better than indicated records. 

[tombgrt]

FFH is helped by those first few years.  The last few the returns have been "only" around 20%.

 

 

Yes, in 1986 they had an increase in BV of 180% and the next four years is wat 37% on average. That adds up.

Still amazing of course, but I wouldn't dream of 25% going forward (not that Prem is).

[Eddie Willers]

Thanks for the ideas everyone –

 

I found the following article from MarketWatch dated 2-14-2005:

 

After Eaton Vance, the best-performing stocks for the 25-year period in order of returns were Kansas City Southern  (KSU 53.95, -0.11, -0.20%) , Countrywide Financial Corp. , Progressive Corp.  (PGR 20.88, +0.19, +0.92%) , Stryker Corp.  (SYK 63.67, -0.89, -1.38%) , National Technical Systems  (NTSC 7.34, +0.10, +1.38%) , Forest Laboratories  (FRX 32.47, -0.28, -0.85%) , Wal-Mart, State Street Corp.  (STT 43.81, -0.35, -0.79%) , Mylan Laboratories  (MYL 22.74, -0.36, -1.55%) , M&T Bank, Leucadia National Corp.  (LUK 32.40, -0.28, -0.86%) , Allete Inc.  (ALE 38.88, +0.05, +0.13%) , Dollar General Corp  (DG 28.47, +0.49, +1.75%) . and Berkshire, according to FactSet Research.

 

This is turning out to be a tough one to answer.  I can’t seem to find any articles about book value growth over a 25 year period. 

 

If we can’t come up with the top 10, I’ll ask Prem about it at the AGM….

 

My question will go something like this… “What are top 10 companies?....Now that we're considering companies outside of the insurance industry, will Fairfax acquire them all?  ;D

 

Thanks all and best regards.

 

[frog03]

In M&T's bank presentations, they list the top US performers (stock price + dividends) since 1980.

 

The first five:

1) Eaton Vance 25.1%

2) Limited Brands 23.3%

3) Gap 22.8%

4) Progressive 22.8%

5) TJX 22.6%

...

11) Leucadia 20.9%

...

17) Berkshire 20.2%

 

In Canada, depending on the metric (book or total return) and exact time interval, CNQ and Alimentation Couche Tard have done about as well as Fairfax.