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Stewart Information Services Corp. (STC)
NYSE:STC
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Stewart Information Services
(NYSE:STC)
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Rating:74Outperform
Price Target:
$73.00
▲(6.04% Upside)
Action:ReiteratedDate:12/13/25
Stewart Information Services has a strong financial foundation with impressive revenue growth and strategic expansion initiatives. The earnings call and recent corporate events further highlight the company's resilience and strategic progress. While technical indicators show a neutral trend, the company's fair valuation and attractive dividend yield provide a solid investment case.
Positive Factors
Strong recent revenue and EPS growth
Sustained double-digit revenue and significant EPS growth across quarters indicate broad-based demand and operational leverage. Diversified segment gains (agency, commercial, international) reduce dependence on any single market and underpin durable earnings power and reinvestment capacity.
Very high gross margins and strong free cash flow
Extremely high gross margins imply structural pricing power and low direct cost of revenue in title and related services. Combined with reported free cash flow growth and a very high FCF-to-net-income ratio, this supports sustainable cash generation for dividends, buybacks, and strategic investments.
Moderate leverage and solid equity base
A conservative debt profile and a strong equity ratio provide financial flexibility to fund acquisitions and dividends while limiting refinancing risk. Improving ROE suggests capital is being deployed more efficiently, supporting long-term financial resilience and strategic optionality.
Negative Factors
Exposure to weak residential housing market
Title insurance and settlement volumes are highly correlated with home transaction activity. Prolonged lows in residential real estate compress the addressable market, cap organic revenue upside, and make sustained top-line growth more dependent on market share gains or non-residential diversification.
Low net profit margin and cash flow volatility
Despite very high gross margins, low net margins point to elevated operating or SG&A costs that erode profitability. Coupled with a noted low operating-cash-flow-to-net-income ratio, this suggests earnings are more sensitive to expense swings and could limit durable margin expansion.
Large acquisition and equity offering raise integration and dilution risk
A sizable cash acquisition plus a contemporaneous equity raise changes capital structure and creates integration risk. If acquisition synergies underperform or M&A execution diverts management focus, returns on invested capital and shareholder dilution could pressure long-term value creation.
Stewart Information Services (STC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.02B
Dividend Yield2.88%
Average Volume (3M)146.97K
Price to Earnings (P/E)16.7
Beta (1Y)0.73
Revenue Growth16.22%
EPS Growth69.80%
CountryUS
Employees6,800
SectorFinancial
Sector Strength70
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)1.65
Shares Outstanding29,924,204
10 Day Avg. Volume134,661
30 Day Avg. Volume146,971
Financial Highlights & Ratios
PEG Ratio0.33
Price to Book (P/B)1.24
Price to Sales (P/S)0.70
P/FCF Ratio0.00
Enterprise Value/Market Cap-157.87
Enterprise Value/Revenue-109.12
Enterprise Value/Gross Profit-124.40
Enterprise Value/Ebitda-1.32K
Forecast
1Y Price Target
$81.00Price Target Upside17.66% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)5.8
Revenue Forecast (FY)$3.30B
Stewart Information Services Business Overview & Revenue Model
Company DescriptionStewart Information Services Corporation, through its subsidiaries, provides title insurance and real estate transaction related services. The company operates in two segments, Title, and Ancillary Services and Corporate. The Title segment is involved in searching, examining, closing, and insuring the condition of the title to real property. This segment also offers home and personal insurance services; services for tax-deferred exchanges; and digital customer engagement platform services. The Ancillary Services and Corporate segment provides appraisal management, online notarization and closing, credit and real estate information, and search and valuation services to the mortgage industry. The company offers its products and services through its directly owned policy-issuing offices, network of independent agencies, and other businesses within the company. It serves homebuyers and sellers, residential and commercial real estate professionals, title agencies, real estate attorneys and investors, and home builders, as well as mortgage lenders, servicers, brokers, and investors. The company operates in the United States, Canada, the United Kingdom, and Australia. Stewart Information Services Corporation was founded in 1893 and is headquartered in Houston, Texas.
How the Company Makes MoneyStewart Information Services generates revenue primarily through the sale of title insurance policies and related services. The company earns money by charging fees for title searches, title insurance premiums, and settlement services during real estate transactions. Key revenue streams include direct title insurance sales, fees from closing and escrow services, and commissions from agents and brokers. Additionally, Stewart leverages technology solutions to enhance operational efficiency and drive revenue growth. Partnerships with real estate agencies, lenders, and other industry stakeholders further contribute to its earnings by expanding its market reach and service offerings.
Stewart Information Services Key Performance Indicators (KPIs)
Stewart Information Services Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 29, 2026
Earnings Call Sentiment Positive
The call presented a broadly positive operational and financial progress narrative: significant revenue, profit and margin expansion in 2025 across title, agency and commercial businesses; strengthened balance sheet and strategic acquisition (MCS) to expand lender services; and multiple profitable growth initiatives (commercial expansion, agency commercial initiatives, and targeted M&A). Key challenges remain: a depressed existing-home-sales backdrop that pressures volumes and first-quarter seasonality, margin shortfalls in parts of Real Estate Solutions, and localized regulatory rate reductions (Texas) that pressure some agents. Management expects modest housing improvement in 2026 and sees continued upside from commercial momentum and acquired capabilities, while acknowledging risks to timing and pace of market recovery.Q4-2025 Updates
Positive Updates
Strong Full-Year Financial Performance
Full year 2025 revenue grew 18%, net income grew 48%, and adjusted EPS grew 46% year-over-year. Adjusted pretax margin expanded to 6.8% from 5.8% the prior year.
Robust Fourth Quarter Results
Q4 revenue increased 20% year-over-year to $791 million. Reported Q4 net income was $36 million ($1.25 diluted EPS); adjusted Q4 net income was $48 million ($1.65 diluted EPS), a 50% increase versus prior-year adjusted results.
Title Segment Margin and Revenue Improvement
Title operating revenues rose $106 million (19%) in Q4. Title adjusted pretax income improved 35% to $68 million from $51 million and adjusted pretax margin increased to 10% from ~9% year-over-year.
Commercial Business Outperformance
All domestic commercial revenues grew 34% for the year. National commercial services grew 43% year-over-year and delivered a 49% increase in Q4. Average domestic commercial fee per file increased ~39% to ~$27,000 in Q4.
Agency and Direct Operations Growth
Agency services revenue grew ~21% for the year and 20% in Q4, with notable strength in Florida, Texas and New York. Direct operations main street commercial grew 17% for the year; direct operations grew 8% in Q4 despite a challenged residential market.
Real Estate Solutions Revenue Expansion
Real Estate Solutions revenues rose 22% year-over-year (29% in Q4). Q4 adjusted pretax income for the segment improved 47% to $10 million from $6 million, with Q4 adjusted pretax margin of 8.5% and a plan to reach low‑teens margin in 2026.
Strategic Acquisition and Product Expansion
Closed acquisition of Mortgage Contracting Services (MCS) in December to expand default and lender services; MCS reported ~ $165 million annual revenue and roughly $40 million EBITDA, expected to broaden cross-sell opportunities.
Strengthened Financial Flexibility and Capital Position
Upsized credit facility by $100 million to $300 million and completed an equity offering of 2.2 million shares raising $140 million. Total cash and investments were approximately $480 million in excess of statutory reserves; stockholders' equity ~$1.6 billion and book value of $54 per share (+$4 YoY).
Operational Efficiency and Cash Generation
Net cash provided by operations improved $22 million (32%). Employee cost ratio improved to 29% from 31% driven by revenue growth; other operating expense ratio remained ~25%.
Claims and Loss Performance
Fourth-quarter title loss ratio improved to 3.4% from 3.7% year-over-year, reflecting favorable claims experience. Management expects 2026 title losses to average in the 3.5%–4% range.
Negative Updates
Persistently Weak Existing Home Sales
Company noted a multi-year slump in existing home sales with two consecutive years at the lowest levels in 30 years; existing home sales have been ~4 million units for three years and are not expected to return to the ~5 million long-term average in 2026, constraining volume and margins.
First-Quarter Seasonality and Fixed-Cost Leverage
Large fixed-cost base (~500 locations) creates meaningful seasonality and margin pressure in Q1 when volumes are low; management emphasized operating leverage that would materially improve only as existing-home-sales recover toward 5M.
Real Estate Solutions Margin Shortfall and Costs
Full-year Real Estate Solutions margin was 10.1%, below management's target due to isolated pricing issues and expansion costs. While Q4 margin improved, the segment must still normalize margins into the low‑teens in 2026.
Texas Title Rate Reduction Impact on Agents
Texas title premium rate reduction (~6%) is expected to have a low-single-digit negative impact on company earnings this year and may materially pressure small/rural agents' profitability, potentially causing agency disruption in some areas.
MCS and Foreclosure Exposure Seasonality
MCS contribution (~$165M revenue, ~$40M EBITDA) carries some seasonality (lower in Q1) and exposure to rising delinquencies/foreclosures, introducing near-term revenue volatility in lender/default services.
Potential Moderation in Commercial Growth Rates
Management cautioned that the very strong commercial growth in 2025 (e.g., 49% in Q4) could moderate in 2026 due to tougher comparisons despite continued healthy pipeline and market share opportunities.
Company Guidance
Guidance from the call was cautiously optimistic: management expects modest housing-market improvement in 2026 but does not expect existing home sales to return to the long‑term ~5.0M level this year; Q1 should be a bit better than last year but remain seasonal. They expect title losses to average about 3.5%–4.0% in 2026 (Q4 title loss ratio was 3.4%), Real Estate Solutions margins to normalize to the low‑teens (Q4 margin 8.5%), and lender‑services margins to be roughly in the 12%–13% range; commercial revenue growth should continue but may moderate from the exceptional 49% Q4 / 43% full‑year gains. Management reiterated balance‑sheet flexibility (credit facility upsized to $300M, ~$200M drawn currently, $140M raised via a 2.2M‑share offering, and ~ $480M cash/investments in excess of statutory reserves), said MCS adds roughly $165M of annual revenue (~$40M EBITDA) with some Q1 seasonality, and noted investment income could move by only a few million depending on timing of any rate cuts as higher escrow balances largely offset lower short‑term yields.Stewart Information Services Financial Statement Overview
Summary
Stewart Information Services exhibits a robust financial position with strong revenue growth and excellent gross profit margins. The balance sheet is stable with moderate leverage and improving return on equity. Cash flow generation is impressive, although there is some volatility in operating cash flow. The company is well-positioned for future growth, but there is room for improvement in net profitability and operational efficiency.Income Statement
Stewart Information Services has demonstrated a solid revenue growth rate of 4.71% in the TTM, recovering from previous declines. The gross profit margin is exceptionally high at 97.62%, indicating strong cost management. However, the net profit margin is relatively low at 3.29%, suggesting room for improvement in operational efficiency. The EBIT and EBITDA margins are stable, reflecting consistent earnings before interest and taxes.75
Positive
Balance Sheet
The company's debt-to-equity ratio is moderate at 0.40, indicating a balanced approach to leveraging. Return on equity is improving, currently at 6.22%, which is a positive sign of profitability. The equity ratio stands at 51.68%, showcasing a strong equity base relative to total assets, which enhances financial stability.70
Positive
Cash Flow
Stewart Information Services has shown a significant free cash flow growth rate of 4% in the TTM, indicating strong cash generation capabilities. The free cash flow to net income ratio is exceptionally high at 404.21, highlighting efficient cash utilization. However, the operating cash flow to net income ratio is low, suggesting potential volatility in cash flow relative to earnings.80
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.92B | 2.49B | 2.26B | 3.07B | 3.31B |
| Gross Profit | 2.56B | 2.41B | 2.18B | 2.97B | 3.18B |
| EBITDA | 241.43M | 195.84M | 143.04M | 308.23M | 475.39M |
| Net Income | 115.56M | 73.31M | 30.44M | 162.31M | 323.22M |
Balance Sheet | |||||
| Total Assets | 3.25B | 2.73B | 2.70B | 2.74B | 2.81B |
| Cash, Cash Equivalents and Short-Term Investments | 321.77M | 257.50M | 272.39M | 272.69M | 503.57M |
| Total Debt | 890.91M | 564.68M | 580.94M | 595.01M | 632.91M |
| Total Liabilities | 1.60B | 1.32B | 1.32B | 1.37B | 1.52B |
| Stockholders Equity | 1.64B | 1.40B | 1.37B | 1.36B | 1.28B |
Cash Flow | |||||
| Free Cash Flow | 0.00 | 95.14M | 45.25M | 143.91M | 350.49M |
| Operating Cash Flow | 0.00 | 135.61M | 83.04M | 191.86M | 390.29M |
| Investing Cash Flow | 0.00 | -87.26M | -29.97M | -300.67M | -645.28M |
| Financing Cash Flow | 0.00 | -60.96M | -69.10M | -123.22M | 310.37M |
Stewart Information Services Technical Analysis
Positive
68.84
Price Trends
69.25
Negative
70.38
Negative
68.07
Positive
Market Momentum
-0.31
Positive
50.62
Neutral
23.78
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STC, the sentiment is Positive. The current price of 68.84 is below the 20-day moving average (MA) of 68.85, below the 50-day MA of 69.25, and above the 200-day MA of 68.07, indicating a neutral trend. The MACD of -0.31 indicates Positive momentum. The RSI at 50.62 is Neutral, neither overbought nor oversold. The STOCH value of 23.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STC.
Stewart Information Services Risk Analysis
Stewart Information Services disclosed 22 risk factors in its most recent earnings report. Stewart Information Services reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Stewart Information Services Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $1.82B | 11.29 | 18.85% | ― | 22.51% | 2.19% | |
78 Outperform | $2.03B | 10.00 | 31.94% | 0.82% | 8.71% | 17.26% | |
75 Outperform | $1.15B | 13.16 | 9.97% | 4.59% | 13.35% | 16.56% | |
74 Outperform | $2.02B | 16.68 | 7.08% | 2.88% | 16.22% | 69.80% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
61 Neutral | $896.21M | 19.59 | 17.02% | ― | 38.50% | ― | |
56 Neutral | $1.83B | 13.65 | 9.03% | 3.15% | 4.51% | -8.29% |
* Financial Sector Average
STC
Stewart Information Services
68.84
0.19
0.28%
SAFT
Safety Insurance Group
78.46
6.69
9.32%
KMPR
Kemper
31.51
-31.56
-50.04%
HCI
HCI Group
163.50
43.37
36.10%
ROOT
Root
61.09
-37.62
-38.11%
SKWD
Skyward Specialty Insurance Group, Inc.
45.89
-5.12
-10.04%
Stewart Information Services Corporate Events
M&A TransactionsPrivate Placements and Financing
Stewart Information Services Completes Major Acquisition
Positive
Dec 12, 2025
On December 10, 2025, Stewart Information Services Corporation entered into an underwriting agreement with Goldman Sachs & Co. LLC to issue and sell 1,900,000 shares of common stock in a public offering, with an option for an additional 285,000 shares, which was fully exercised by December 11, 2025. Additionally, on the same day, Stewart’s subsidiary, SISCO Holdings, LLC, completed the acquisition of Mortgage Contracting Services for $330 million, enhancing its position in the property preservation services market.
The most recent analyst rating on (STC) stock is a Buy with a $81.00 price target. To see the full list of analyst forecasts on Stewart Information Services stock, see the STC Stock Forecast page.
Dividends
Stewart Information Services Declares Q4 2025 Dividend
Neutral
Dec 1, 2025
On December 1, 2025, Stewart Information Services Corporation announced that its Board of Directors declared a cash dividend of $0.525 per share for the fourth quarter of 2025. This dividend is payable on December 30, 2025, to stockholders of record as of December 15, 2025.
The most recent analyst rating on (STC) stock is a Buy with a $87.00 price target. To see the full list of analyst forecasts on Stewart Information Services stock, see the STC Stock Forecast page.
Business Operations and StrategyM&A Transactions
Stewart Information Services Acquires Mortgage Contracting Services
Positive
Nov 7, 2025
On November 6, 2025, Stewart Information Services Corporation announced that its subsidiary, SISCO Holdings, entered into an agreement to acquire Mortgage Contracting Services (MCS) for $330 million in cash. This acquisition, expected to close by the end of the year, aims to enhance Stewart’s real estate services portfolio by adding property preservation services to support mortgage servicers and lenders. The transaction is anticipated to be immediately accretive and will be funded with Stewart’s available resources, with MCS continuing to operate as a standalone company.
The most recent analyst rating on (STC) stock is a Buy with a $79.00 price target. To see the full list of analyst forecasts on Stewart Information Services stock, see the STC Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.