No. of Recommendations: 3
Being enamored with Berkshire Hathaway model, I’d read many times MKL a baby BRK. Have checked out Fairfax Financial for being such also. Prem Watsa’s stake in Blackberry Ltd has me scratching my head. Blackberry own many patents and is trying to pivot their model into EV auto drive and cyber security. Like all great Investors- appears wrong until he’s right. May take four or five years.
Blackberry is clearly an error - and 4-5 years more is unlikely to change this, and surely Fairfax investors are not really expecting anything positive out of Blackberry.
However, it is worth noting that Blackberry, while it was once a $500m investment in a now represents 0.2% of Fairfax's $60b in investments, so while this investment can be legitimately held up as an example of a Watsa mistake, and was a big bet in 2012, when it was made, Fairfax has reduced its debenture position, the share holdings have withered in value, and Fairfax has far more assets overall now, so Blackberry will not be a drag on Fairfax's results going forward.
dtb
