The Best “Sleep-Well” Stock on the TSX Right Now

Your portfolio should not feel like a horror movie, yet plenty of Canadians treat it that way at 2 a.m. A 2025 Financial Stress Index from FP Canada found 49% of Canadians still lose sleep over financial stress. Another recent benchmark survey summary also tied money worries to anxiety and lost sleep. When the noise gets loud, a “sleep-well” stock is the one that can keep earning through chaos, not the one that wins the hottest trend of the week.

FFH

That’s why Fairfax Financial Holdings (TSX:FFH) stands out right now. It runs a global property and casualty insurance and reinsurance group, and it invests the float with a long-term mindset. Premiums come in, claims go out, and disciplined underwriting can leave a durable stream of profit. Then the investment portfolio can add another layer of compounding.

Over the last year, Fairfax has kept doing the unsexy work that tends to create real wealth. It didn’t need a miracle product launch. It needed pricing discipline, risk selection, and patience. The share price still moved around, but the model stayed steady. And with an ultra-low beta of just 0.5, it still trades with enough swings to test anyone who refreshes the quote too often.

News flow also stayed practical, which is a nice change in a market that loves drama. In December 2025, Fairfax announced it sold 25,000,000 common shares of Orla Mining at about $17.64 per share for proceeds of roughly $441.1 million. That tells you management will take gains when it likes the price. For a sleep-well holding, that kind of behaviour matters.

Earnings support

The latest quarter gave investors the numbers that calmed nerves. In the third quarter of 2025, Fairfax reported net earnings of US$1.2 billion, or US$52.04 per diluted share, up from US$1.04 billion, or US$42.62, a year earlier. It also reported book value per basic share of US$1,203.65 at Sept. 30, 2025, up 15.1% from year-end 2024 after adjusting for a $20.77 dividend paid earlier in 2025. Book value matters here because long-term returns tend to follow it.

Even better, underwriting did not take a back seat. Fairfax reported a consolidated combined ratio of 92% and an underwriting profit of US$540.3 million on an undiscounted basis in the quarter. That means it made money on the insurance business itself, before you even talk about investment gains. That’s the foundation you want if you are trying to sleep.

Looking forward, the appeal stays simple. It spreads risk across many insurance operations, and it can reprice policies as claims trends change. Higher interest income can also help when yields stay elevated, because it holds a large pool of invested assets. None of this makes it invincible. Catastrophe losses can spike, inflation can raise claim costs, and markets can swing hard. Even so, trading at a cheap 8.4 times earnings and a solid 0.9% dividend yield, it’s a strong, sleep well stock.

Bottom line

So, is Fairfax the best sleep-well Canadian stock on the TSX right now? It could be if you want a business that earns from underwriting discipline and invests with patience, and if you can hold through occasional drawdowns without panicking. It could be the wrong choice if catastrophe headlines make you want to hit sell. For everyone else, the pitch is refreshingly plain: let it do the boring work, and let your nights get quiet again.

The post The Best “Sleep-Well” Stock on the TSX Right Now appeared first on The Motley Fool Canada.

Should you invest $1,000 in Fairfax Financial right now?

Before you buy stock in Fairfax Financial, consider this:

The Motley Fool Canada team has identified what they believe are the top 10 TSX stocks for 2026… and Fairfax Financial wasn’t one of them. The 10 stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 … if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $20,155.76!*

Now, it’s worth noting Stock Advisor Canada’s total average return is 90%* – a market-crushing outperformance compared to 81%* for the S&P/TSX Composite Index. Don’t miss out on our top 10 stocks, available when you join our mailing list!

Get the 10 stocks instantly #start_btn6 { background: #0e6d04 none repeat scroll 0 0; color: #fff; font-size: 1.2em; font-family: 'Montserrat', sans-serif; font-weight: 600; height: auto; line-height: 1.2em; margin: 30px 0; max-width: 350px; text-align: center; width: auto; box-shadow: 0 1px 0 rgba(0, 0, 0, 0.5), 0 1px 0 #fff inset, 0 0 2px rgba(0, 0, 0, 0.2); border-radius: 5px; } #start_btn6 a { color: #fff; display: block; padding: 20px; padding-right:1em; padding-left:1em; } #start_btn6 a:hover { background: #FFE300 none repeat scroll 0 0; color: #000; } @media (max-width: 480px) { div#start_btn6 { font-size:1.1em; max-width: 320px;} } margin_bottom_5 { margin-bottom:5px; } margin_top_10 { margin-top:10px; }

* Returns as of February 17th, 2026

More reading

• I Just Bought Fairfax Stock: Here’s Why You Might Want Shares, Too
• Outlook for Fairfax Financial Stock in 2026
• 2 Canadian Stocks That Can Lead the Way to Retirement
• What’s the Average TFSA Balance at Age 30 in Canada?

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Fairfax Financial. The Motley Fool has a disclosure policy.