Fairfax Financial Holdings (TSX:FFH) Beneish M-Score: -2.30 (As of Jun. 26, 2026)


TSX:FFH Fairfax Financial Holdings Ltd TSX:FFH
77 GF Score
Price C$2,340.67
GF Value C$2,159.03
Valuation Fairly Valued
! 3 Warning Signs
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What is Fairfax Financial Holdings Beneish M-Score?

Fairfax Financial Holdings TSX:FFH +0.89% 77 Beneish M-Score is -2.30 as of Jun. 26, 2026. GuruFocus rates TSX:FFH with a GF Score™ of 77/100 and a GF Value™ of C$2,159.03 (Fairly Valued). The stock has 3 warning signs investors should review. Among 397 Insurance companies, Fairfax Financial Holdings ranks worse than 72.29% on this metric.

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.3 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Fairfax Financial Holdings's Beneish M-Score or its related term are showing as below:

TSX:FFH' s Beneish M-Score Range Over the Past 10 Years
Min: -3.55   Med: -2.59   Max: 1.33
Current: -2.3

During the past 13 years, the highest Beneish M-Score of Fairfax Financial Holdings was 1.33. The lowest was -3.55. And the median was -2.59.

TSX:FFH
77GF Score
Fairfax Financial Holdings Ltd TSX:FFH
Beneish M-Score is just one metric. See GF Score™, valuation, warning signs, and more.
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Fairfax Financial Holdings Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Fairfax Financial Holdings for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.0315+0.528 * 1+0.404 * 1+0.892 * 1.0253+0.115 * 1
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9358+4.679 * 0.028609-0.327 * 1.0629
=-2.30

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

This Year (Mar26) TTM:Last Year (Mar25) TTM:
Total Receivables was C$1,319 Mil.
Revenue was 8799.871 + 10624.495 + 10442.18 + 10962.146 = C$40,829 Mil.
Gross Profit was 8799.871 + 10624.495 + 10442.18 + 10962.146 = C$40,829 Mil.
Total Current Assets was C$0 Mil.
Total Assets was C$147,339 Mil.
Property, Plant and Equipment(Net PPE) was C$0 Mil.
Depreciation, Depletion and Amortization(DDA) was C$920 Mil.
Selling, General, & Admin. Expense(SGA) was C$6,367 Mil.
Total Current Liabilities was C$0 Mil.
Long-Term Debt & Capital Lease Obligation was C$19,275 Mil.
Net Income was 954.5 + 1708.235 + 1593.262 + 1963.682 = C$6,220 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = C$0 Mil.
Cash Flow from Operations was -372.498 + -1791.419 + 2977.492 + 1190.893 = C$2,004 Mil.
 Total Receivables was C$1,248 Mil.
Revenue was 10737.283 + 8854.653 + 10908.729 + 9322.141 = C$39,823 Mil.
Gross Profit was 10737.283 + 8854.653 + 10908.729 + 9322.141 = C$39,823 Mil.
Total Current Assets was C$0 Mil.
Total Assets was C$141,978 Mil.
Property, Plant and Equipment(Net PPE) was C$0 Mil.
Depreciation, Depletion and Amortization(DDA) was C$1,244 Mil.
Selling, General, & Admin. Expense(SGA) was C$6,635 Mil.
Total Current Liabilities was C$0 Mil.
Long-Term Debt & Capital Lease Obligation was C$17,474 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total Receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1319.452 / 40828.692) / (1247.68 / 39822.806)
=0.032317 / 0.031331
=1.0315

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(39822.806 / 39822.806) / (40828.692 / 40828.692)
=1 / 1
=1

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than Property, Plant and Equipment to Total Assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (0 + 0) / 147338.806) / (1 - (0 + 0) / 141977.682)
=1 / 1
=1

4. SGI = Sales Growth Index

Ratio of Revenue in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=40828.692 / 39822.806
=1.0253

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(1243.887 / (1243.887 + 0)) / (919.527 / (919.527 + 0))
=1 / 1
=1

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(6366.639 / 40828.692) / (6635.48 / 39822.806)
=0.155935 / 0.166625
=0.9358

7. LVGI = Leverage Index

The ratio of total debt to Total Assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((19274.954 + 0) / 147338.806) / ((17473.836 + 0) / 141977.682)
=0.130821 / 0.123075
=1.0629

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(6219.679 - 0 - 2004.468) / 147338.806
=0.028609

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Fairfax Financial Holdings has a M-score of -2.30 suggests that the company is unlikely to be a manipulator.

Frequently Asked Questions Learn more about Beneish M-Score →
What does a Beneish M-Score of -2.30 mean?
Fairfax Financial Holdings (TSX:FFH) has a Beneish M-Score of -2.30 as of Jun. 26, 2026. The Beneish M-score measures the likelihood of earnings manipulation. View historical data on Fairfax Financial Holdings and its competitors. According to the industry distribution chart, Fairfax Financial Holdings ranks #287 out of 397 companies in the Insurance industry, placing it in the top 72.3%.
Is Fairfax Financial Holdings' Beneish M-Score too high?
Fairfax Financial Holdings' current Beneish M-Score is -2.30. Based on the distribution chart, Fairfax Financial Holdings ranks #287 out of 397 companies in the Insurance industry, which is below the industry midpoint. Overall, Fairfax Financial Holdings has a GF Score™ of 77/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Fairfax Financial Holdings' Beneish M-Score compare to CB and PGR?
According to the Insurance industry distribution chart, Fairfax Financial Holdings ranks #287 out of 397 companies for Beneish M-Score. This places Fairfax Financial Holdings in the lower half of its industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Beneish M-Score for an Insurance company?
A good Beneish M-Score depends on the Insurance industry context. However, Beneish M-Score should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Beneish M-Score mean?
A high Beneish M-Score can signal that a stock is expensive relative to its fundamentals. The Beneish M-score measures the likelihood of earnings manipulation. View historical data on Fairfax Financial Holdings and its competitors. Fairfax Financial Holdings's current Beneish M-Score is -2.30. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Fairfax Financial Holdings stock overvalued right now?
Based on GuruFocus' analysis, Fairfax Financial Holdings (TSX:FFH) is currently considered Fairly Valued. The stock's GF Value™ is C$2,159.03, compared to a current price of C$2,340.67 — trading 8.4% above its estimated fair value. The current Beneish M-Score is -2.30. Fairfax Financial Holdings' overall GF Score™ is 77/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Beneish M-Score calculated?
Beneish M-Score is calculated from a company's financial statements. For Fairfax Financial Holdings (TSX:FFH), the current Beneish M-Score is -2.30 as of Jun. 26, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.

Is Fairfax Financial Holdings (TSX:FFH) Overvalued in 2026?

Based on GuruFocus' analysis, Fairfax Financial Holdings stock appears to be overvalued. The current stock price of C$2,340.67 is trading 8.4% above its estimated GF Value™ of C$2,159.03. GuruFocus considers Fairfax Financial Holdings to be Fairly Valued.

Key valuation signals for TSX:FFH:

  • Beneish M-Score: -2.30
  • GF Value™: C$2,159.03 vs. price of C$2,340.67 (8.4% above fair value)
  • GF Score™: 77/100 with 3 warning signs

No single metric tells the full story. See the TSX:FFH stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.

Fairfax Financial Holdings Business Description

Address 95 Wellington Street West, Suite 800, Toronto, ON, CAN, M5J 2N7
Fairfax Financial Holdings provides reinsurance and property and casualty insurance in Canada, the United States, and other international markets. The company also has some noninsurance operations such as restaurants. Fairfax has been led by Prem Watsa, its chair and CEO, since its formation in 1985.
77GF Score

Get the complete analysis for TSX:FFH

Beneish M-Score is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.

C$2,340.67
Price
C$2,159.03
GF Value