FAF Stock Analysis: First American | NYSE
Insurance - Specialty | NYSE, USA | Market Cap: 6.644m USD | 12M Return: 5.4% | US31847R1023 | Charts, Fundamentals & Technical Analysis
Avg Turnover: 65.2M
EPS Trend: 97.9%
Qual. Beats: 0
Rev. Trend: -37.8%
Qual. Beats: 0
Warnings
Tailwinds
No distinct edge detected
Seasonality 11.7 years of data
How good or bad each month usually is (without trend). The score below shows how much you can trust it: 0 = pure chance, >40 gets interesting and >55 is strong.
First American Financial Corporation (FAF) is a U.S.-based financial services company that operates through two segments: Title Insurance and Services, and Home Warranty. Founded in 1889 and headquartered in Santa Ana, California, the company has a long history in the real estate transaction services industry.
The Title Insurance and Services segment is the core business, issuing title insurance policies on residential and commercial properties and providing a broad suite of related services. These include closing and escrow services, appraisals and valuations, lien release and document custodial services, warehouse lending, subservicing of mortgage loans, banking, trust and wealth management, tax-deferred real estate exchanges, and the maintenance of title plant data and records. Distribution occurs through direct operations and agents across U.S. states and the District of Columbia, as well as in Canada, the United Kingdom, Australia, New Zealand, South Korea, and other international markets.
The Home Warranty segment sells residential service contracts that protect against normal wear-and-tear failures of systems such as heating and air conditioning, along with certain appliances. This segment operates in various U.S. states and the District of Columbia.
Title insurance is a specialty insurance line whose revenue is closely tied to real estate transaction volume, making the business cyclical and dependent on housing market activity. Both segments are linked to home sales and homeownership trends, with home warranty products often bundled into or sold alongside real estate transactions.
- Mortgage rate decline lifts title insurance order volume
- Existing home sales recovery drives premium revenue growth
- Capital returns accelerate through dividends and share buybacks
| Net Income: 732.5m TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.05 > 0.02 and ΔFCF/TA 0.84 > 1.0 |
| NWC/Revenue: -3.74% < 20% (prev -83.05%; Δ 79.31% < -1%) |
| CFO/TA 0.06 > 3% & CFO 1.00b > Net Income 732.5m |
| Net Debt (1.00b) to EBITDA (1.18b): 0.85 < 3 |
| Current Ratio: 0.92 > 1.5 & < 3 |
| Outstanding Shares: last quarter (103.2m) vs 12m ago -0.58% < -2% |
| Gross Margin: 92.39% > 18% (prev 63.01%; Δ 29.38% > 0.5%) |
| Asset Turnover: 24.11% > 50% (prev 40.21%; Δ -16.10% > 0%) |
| Interest Coverage Ratio: 6.12 > 6 (EBIT TTM 960.7m / Interest Expense TTM 157.0m) |
| A: -0.01 (Total Current Assets 1.73b - Total Current Liabilities 1.89b) / Total Assets 18.0b |
| B: 0.22 (Retained Earnings 4.01b / Total Assets 18.0b) |
| C: 0.05 (EBIT TTM 960.7m / Avg Total Assets 17.8b) |
| D: 0.43 (Book Value of Equity 5.39b / Total Liabilities 12.6b) |
| Altman-Z'' = 1.48 = BB |
As of October 25, 2026, the stock is trading at USD 64.72 with a total of 1,322,114 shares traded. Over the past week, the price has changed by -0.31%, over one month by -4.07%, over three months by -5.28% and over the past year by +5.40%.
Current recommended Stop Loss: 62.00 (which is 4.2% or 1.4 ATR below the current price).
First American has received a consensus analysts rating of 4.67. Therefore, it is recommended to buy FAF.
- StrongBuy: 4
- Buy: 2
- Hold: 0
- Sell: 0
- StrongSell: 0
| Analysts Target Price | 82.3 | 27.2% |
P/E Trailing = 9.2037
P/E Forward = 9.3809
P/S = 0.8321
P/B = 1.2368
P/EG = 2.9767
Revenue TTM = 4.29b USD
EBIT TTM = 960.7m USD
EBITDA TTM = 1.18b USD
Long Term Debt = 2.45b USD (from longTermDebt, last fiscal year)
Short Term Debt = 81.3m USD (from shortTermDebt, last fiscal year)
Debt = 2.74b USD (corrected: LT Debt 2.45b + ST Debt 81.3m) + Leases 206.2m
Net Debt = 1.00b USD (calculated: Debt 2.74b - CCE 1.73b)
Enterprise Value = 7.65b USD (6.64b + Debt 2.74b - CCE 1.73b)
Interest Coverage Ratio = 6.12 (Ebit TTM 960.7m / Interest Expense TTM 157.0m)
EV/FCF = 9.19x (Enterprise Value 7.65b / FCF TTM 832.3m)
FCF Yield = 10.88% (FCF TTM 832.3m / Enterprise Value 7.65b)
FCF Margin = 19.40% (FCF TTM 832.3m / Revenue TTM 4.29b)
Net Margin = 17.07% (Net Income TTM 732.5m / Revenue TTM 4.29b)
Gross Margin = 92.39% ((Revenue TTM 4.29b - Cost of Revenue TTM 326.6m) / Revenue TTM)
Gross Margin QoQ = none% (prev none%)
Tobins Q-Ratio = 0.43 (Enterprise Value 7.65b / Total Assets 18.0b)
Interest Expense / Debt = 5.74% (Interest Expense 157.0m / Debt 2.74b)
Taxrate = 23.61% (226.8m / 960.7m)
NOPAT = 733.9m (EBIT 960.7m * (1 - 23.61%))
Current Ratio = 0.92 (Total Current Assets 1.73b / Total Current Liabilities 1.89b)
Debt / Equity = 0.51 (Debt 2.74b / totalStockholderEquity, last quarter 5.39b)
Debt / EBITDA = 0.85 (Net Debt 1.00b / EBITDA 1.18b)
Debt / FCF = 1.21 (Net Debt 1.00b / FCF TTM 832.3m)
Total Stockholder Equity = 5.49b (last 4 quarters mean from totalStockholderEquity)
RoA = 4.12% (Net Income 732.5m / Total Assets 18.0b)
RoE = 13.33% (Net Income TTM 732.5m / Total Stockholder Equity 5.49b)
RoCE = 12.10% (EBIT 960.7m / Capital Employed (Equity 5.49b + L.T.Debt 2.45b))
RoIC = 6.69% (EBIT 960.7m / (Assets 18.0b - Curr.Liab 1.89b - Cash 1.73b))
WACC = 6.06% (E(6.64b)/V(9.38b) * Re(6.75%) + D(2.74b)/V(9.38b) * Rd(5.74%) * (1-Tc(0.24)))
Discount Rate = 6.75% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: -82.36 | Cagr: -0.47%
[DCF] Terminal Value 77.97% ; FCFF base≈766.0m ; Y1≈878.1m ; Y5≈1.29b
[DCF] Fair Price = 180.6 (EV 19.4b - Net Debt 1.00b = Equity 18.4b / Shares 102.1m; r=8.35% [WACC [floored]]; 5y FCF grow 15.0% → 2.50% )
EPS Correlation: 97.85 | EPS CAGR: 32.63% | SUE: -0.48 | # QB: 0
Revenue Correlation: -37.83 | Revenue CAGR: -6.94% | SUE: -0.01 | # QB: 0
EPS current Quarter (2027-03-31): EPS=1.26 | Chg30d=-9.60% | Revisions=-25% | Analysts=5
EPS current Year (2026-12-31): EPS=6.91 | Chg30d=-3.31% | Revisions=-40% | GrowthEPS=+14.1% | GrowthRev=+7.5%
EPS next Year (2027-12-31): EPS=6.88 | Chg30d=-6.91% | Revisions=-40% | GrowthEPS=-0.4% | GrowthRev=+2.2%
[Analyst] Revisions Ratio: -62% (up=0, down=5)