FIRST AMERICAN FINANCIAL (FAF) Fundamental Analysis & Valuation

NYSE:FAF • US31847R1023

Current stock price

62.9 USD
-0.41 (-0.65%)
At close:
62.9 USD
0 (0%)
After Hours:

This FAF fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

4

1. FAF Profitability Analysis

1.1 Basic Checks

  • FAF had positive earnings in the past year.
  • FAF had a positive operating cash flow in the past year.
  • In the past 5 years FAF has always been profitable.
  • In the past 5 years FAF always reported a positive cash flow from operatings.
FAF Yearly Net Income VS EBIT VS OCF VS FCFFAF Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 500M 1B 1.5B

1.2 Ratios

  • FAF has a Return On Assets of 3.83%. This is in the better half of the industry: FAF outperforms 69.59% of its industry peers.
  • Looking at the Return On Equity, with a value of 11.31%, FAF is in line with its industry, outperforming 54.73% of the companies in the same industry.
  • With a decent Return On Invested Capital value of 5.23%, FAF is doing good in the industry, outperforming 75.00% of the companies in the same industry.
  • The Average Return On Invested Capital over the past 3 years for FAF is significantly below the industry average of 9.50%.
  • The last Return On Invested Capital (5.23%) for FAF is above the 3 year average (3.16%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 3.83%
ROE 11.31%
ROIC 5.23%
ROA(3y)2%
ROA(5y)3.06%
ROE(3y)6.15%
ROE(5y)9.12%
ROIC(3y)3.16%
ROIC(5y)4.27%
FAF Yearly ROA, ROE, ROICFAF Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5 10 15 20

1.3 Margins

  • FAF has a Profit Margin (8.34%) which is comparable to the rest of the industry.
  • FAF's Profit Margin has declined in the last couple of years.
  • FAF has a Operating Margin (13.49%) which is in line with its industry peers.
  • FAF's Operating Margin has declined in the last couple of years.
Industry RankSector Rank
OM 13.49%
PM (TTM) 8.34%
GM N/A
OM growth 3Y12.4%
OM growth 5Y-2%
PM growth 3Y35.97%
PM growth 5Y-3.22%
GM growth 3YN/A
GM growth 5YN/A
FAF Yearly Profit, Operating, Gross MarginsFAF Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5 10 15

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2

2. FAF Health Analysis

2.1 Basic Checks

  • FAF has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
  • FAF has less shares outstanding than it did 1 year ago.
  • FAF has less shares outstanding than it did 5 years ago.
  • FAF has a worse debt/assets ratio than last year.
FAF Yearly Shares OutstandingFAF Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20M 40M 60M 80M 100M
FAF Yearly Total Debt VS Total AssetsFAF Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5B 10B 15B

2.2 Solvency

  • The Debt to FCF ratio of FAF is 3.22, which is a good value as it means it would take FAF, 3.22 years of fcf income to pay off all of its debts.
  • The Debt to FCF ratio of FAF (3.22) is comparable to the rest of the industry.
  • A Debt/Equity ratio of 0.45 indicates that FAF is not too dependend on debt financing.
  • With a Debt to Equity ratio value of 0.45, FAF is not doing good in the industry: 65.54% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 0.45
Debt/FCF 3.22
Altman-Z N/A
ROIC/WACC0.66
WACC7.93%
FAF Yearly LT Debt VS Equity VS FCFFAF Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1B 2B 3B 4B 5B

2.3 Liquidity

Industry RankSector Rank
Current Ratio N/A
Quick Ratio N/A
FAF Yearly Current Assets VS Current LiabilitesFAF Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 200M 400M 600M

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

6

3. FAF Growth Analysis

3.1 Past

  • The Earnings Per Share has grown by an impressive 37.41% over the past year.
  • FAF shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 1.85% yearly.
  • Looking at the last year, FAF shows a very strong growth in Revenue. The Revenue has grown by 21.57%.
  • The Revenue has been growing slightly by 1.01% on average over the past years.
EPS 1Y (TTM)37.41%
EPS 3Y-0.27%
EPS 5Y1.85%
EPS Q2Q%47.41%
Revenue 1Y (TTM)21.57%
Revenue growth 3Y-2.02%
Revenue growth 5Y1.01%
Sales Q2Q%18.44%

3.2 Future

  • The Earnings Per Share is expected to grow by 8.60% on average over the next years. This is quite good.
  • FAF is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.27% yearly.
EPS Next Y8.33%
EPS Next 2Y8.44%
EPS Next 3Y8.6%
EPS Next 5YN/A
Revenue Next Year10.4%
Revenue Next 2Y7.91%
Revenue Next 3Y6.27%
Revenue Next 5YN/A

3.3 Evolution

  • When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
FAF Yearly Revenue VS EstimatesFAF Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2B 4B 6B 8B
FAF Yearly EPS VS EstimatesFAF Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2 4 6 8

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5

4. FAF Valuation Analysis

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 10.38, which indicates a very decent valuation of FAF.
  • Compared to the rest of the industry, the Price/Earnings ratio of FAF is on the same level as its industry peers.
  • FAF is valuated cheaply when we compare the Price/Earnings ratio to 27.18, which is the current average of the S&P500 Index.
  • A Price/Forward Earnings ratio of 9.58 indicates a reasonable valuation of FAF.
  • Based on the Price/Forward Earnings ratio, FAF is valued a bit cheaper than 60.14% of the companies in the same industry.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 37.96, FAF is valued rather cheaply.
Industry RankSector Rank
PE 10.38
Fwd PE 9.58
FAF Price Earnings VS Forward Price EarningsFAF Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, FAF is valued a bit cheaper than the industry average as 70.95% of the companies are valued more expensively.
  • Compared to the rest of the industry, the Price/Free Cash Flow ratio of FAF is on the same level as its industry peers.
Industry RankSector Rank
P/FCF 8.44
EV/EBITDA 6.18
FAF Per share dataFAF EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 20 40 60

4.3 Compensation for Growth

  • FAF's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.25
PEG (5Y)5.62
EPS Next 2Y8.44%
EPS Next 3Y8.6%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

8

5. FAF Dividend Analysis

5.1 Amount

  • With a Yearly Dividend Yield of 3.44%, FAF has a reasonable but not impressive dividend return.
  • Compared to an average industry Dividend Yield of 2.44, FAF pays a bit more dividend than its industry peers.
  • FAF's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
Industry RankSector Rank
Dividend Yield 3.44%

5.2 History

  • The dividend of FAF has a limited annual growth rate of 3.98%.
  • FAF has been paying a dividend for at least 10 years, so it has a reliable track record.
  • FAF has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)3.98%
Div Incr Years15
Div Non Decr Years15
FAF Yearly Dividends per shareFAF Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0.5 1 1.5 2

5.3 Sustainability

  • 35.86% of the earnings are spent on dividend by FAF. This is a low number and sustainable payout ratio.
  • The dividend of FAF is growing, but earnings are growing more, so the dividend growth is sustainable.
DP35.86%
EPS Next 2Y8.44%
EPS Next 3Y8.6%
FAF Yearly Income VS Free CF VS DividendFAF Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 200M 400M 600M 800M 1B
FAF Dividend Payout.FAF Dividend Payout, showing the Payout Ratio.FAF Dividend Payout.PayoutRetained Earnings

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FAF Fundamentals: All Metrics, Ratios and Statistics

FIRST AMERICAN FINANCIAL

NYSE:FAF (4/13/2026, 8:23:41 PM)

After market: 62.9 0 (0%)

62.9

-0.41 (-0.65%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)02-11
Earnings (Next)04-22
Inst Owners95.85%
Inst Owner Change-0.01%
Ins Owners0.88%
Ins Owner Change7.42%
Market Cap6.43B
Revenue(TTM)7.45B
Net Income(TTM)621.80M
Analysts80
Price Target83.64 (32.97%)
Short Float %3.87%
Short Ratio3.36
Dividend
Industry RankSector Rank
Dividend Yield 3.44%
Yearly Dividend2.18
Dividend Growth(5Y)3.98%
DP35.86%
Div Incr Years15
Div Non Decr Years15
Ex-Date03-09
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)26.64%
Min EPS beat(2)15.88%
Max EPS beat(2)37.4%
EPS beat(4)4
Avg EPS beat(4)21.63%
Min EPS beat(4)11.22%
Max EPS beat(4)37.4%
EPS beat(8)7
Avg EPS beat(8)13.58%
EPS beat(12)9
Avg EPS beat(12)8.42%
EPS beat(16)12
Avg EPS beat(16)7.68%
Revenue beat(2)2
Avg Revenue beat(2)7.01%
Min Revenue beat(2)5.09%
Max Revenue beat(2)8.92%
Revenue beat(4)4
Avg Revenue beat(4)5.07%
Min Revenue beat(4)2.41%
Max Revenue beat(4)8.92%
Revenue beat(8)5
Avg Revenue beat(8)1.91%
Revenue beat(12)7
Avg Revenue beat(12)1.4%
Revenue beat(16)8
Avg Revenue beat(16)0.74%
PT rev (1m)3.27%
PT rev (3m)6.22%
EPS NQ rev (1m)1.15%
EPS NQ rev (3m)-8.98%
EPS NY rev (1m)1.33%
EPS NY rev (3m)6.52%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)2.83%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)2.55%
Valuation
Industry RankSector Rank
PE 10.38
Fwd PE 9.58
P/S 0.86
P/FCF 8.44
P/OCF 6.77
P/B 1.17
P/tB 1.8
EV/EBITDA 6.18
EPS(TTM)6.06
EY9.63%
EPS(NY)6.57
Fwd EY10.44%
FCF(TTM)7.45
FCFY11.85%
OCF(TTM)9.29
OCFY14.78%
SpS72.85
BVpS53.76
TBVpS35
PEG (NY)1.25
PEG (5Y)5.62
Graham Number85.62
Profitability
Industry RankSector Rank
ROA 3.83%
ROE 11.31%
ROCE 6.72%
ROIC 5.23%
ROICexc 5.77%
ROICexgc 7.45%
OM 13.49%
PM (TTM) 8.34%
GM N/A
FCFM 10.23%
ROA(3y)2%
ROA(5y)3.06%
ROE(3y)6.15%
ROE(5y)9.12%
ROIC(3y)3.16%
ROIC(5y)4.27%
ROICexc(3y)3.66%
ROICexc(5y)4.78%
ROICexgc(3y)4.73%
ROICexgc(5y)6.1%
ROCE(3y)4.05%
ROCE(5y)5.48%
ROICexgc growth 3Y6.59%
ROICexgc growth 5Y-6.56%
ROICexc growth 3Y7.18%
ROICexc growth 5Y-6.3%
OM growth 3Y12.4%
OM growth 5Y-2%
PM growth 3Y35.97%
PM growth 5Y-3.22%
GM growth 3YN/A
GM growth 5YN/A
F-Score8
Asset Turnover0.46
Health
Industry RankSector Rank
Debt/Equity 0.45
Debt/FCF 3.22
Debt/EBITDA 2.01
Cap/Depr 87.1%
Cap/Sales 2.53%
Interest Coverage 6.62
Cash Conversion 77.86%
Profit Quality 122.63%
Current Ratio N/A
Quick Ratio N/A
Altman-Z N/A
F-Score8
WACC7.93%
ROIC/WACC0.66
Cap/Depr(3y)110.7%
Cap/Depr(5y)117.94%
Cap/Sales(3y)3.49%
Cap/Sales(5y)3.11%
Profit Quality(3y)227.55%
Profit Quality(5y)193.14%
High Growth Momentum
Growth
EPS 1Y (TTM)37.41%
EPS 3Y-0.27%
EPS 5Y1.85%
EPS Q2Q%47.41%
EPS Next Y8.33%
EPS Next 2Y8.44%
EPS Next 3Y8.6%
EPS Next 5YN/A
Revenue 1Y (TTM)21.57%
Revenue growth 3Y-2.02%
Revenue growth 5Y1.01%
Sales Q2Q%18.44%
Revenue Next Year10.4%
Revenue Next 2Y7.91%
Revenue Next 3Y6.27%
Revenue Next 5YN/A
EBIT growth 1Y184.86%
EBIT growth 3Y10.13%
EBIT growth 5Y-1.01%
EBIT Next Year35.83%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y12.26%
FCF growth 3Y13.61%
FCF growth 5Y-4.71%
OCF growth 1Y5.94%
OCF growth 3Y6.82%
OCF growth 5Y-2.6%

FIRST AMERICAN FINANCIAL / FAF Fundamental Analysis FAQ

What is the fundamental rating for FAF stock?

ChartMill assigns a fundamental rating of 4 / 10 to FAF.


What is the valuation status for FAF stock?

ChartMill assigns a valuation rating of 5 / 10 to FIRST AMERICAN FINANCIAL (FAF). This can be considered as Fairly Valued.


What is the profitability of FAF stock?

FIRST AMERICAN FINANCIAL (FAF) has a profitability rating of 4 / 10.


What are the PE and PB ratios of FIRST AMERICAN FINANCIAL (FAF) stock?

The Price/Earnings (PE) ratio for FIRST AMERICAN FINANCIAL (FAF) is 10.38 and the Price/Book (PB) ratio is 1.17.


Can you provide the financial health for FAF stock?

The financial health rating of FIRST AMERICAN FINANCIAL (FAF) is 2 / 10.