Zacks Research Has Negative Outlook for FAF FY2026 Earnings

Key Points

• Zacks Research trimmed its FY2026 EPS estimate for First American Financial to $6.72 from $6.74 and maintained a Hold rating on the stock. The new forecast remains slightly below the broader consensus estimate of $6.81 per share.
• First American Financial recently beat quarterly expectations, reporting $1.33 EPS versus the $1.06 consensus and revenue of $1.85 billion versus $1.80 billion expected. Revenue was up 16.2% year over year, and the company posted a 12.58% return on equity.
• The stock was down 2.8% to $65.35, with shares trading below the average analyst target of $83.25. The company also pays a quarterly dividend of $0.55, implying a 3.4% annual yield.

First American Financial Corporation (NYSE:FAF - Free Report) - Zacks Research dropped their FY2026 earnings per share estimates for shares of First American Financial in a research report issued to clients and investors on Wednesday, June 24th. Zacks Research analyst Team now forecasts that the insurance provider will post earnings per share of $6.72 for the year, down from their previous estimate of $6.74. Zacks Research currently has a "Hold" rating on the stock. The consensus estimate for First American Financial's current full-year earnings is $6.81 per share. Zacks Research also issued estimates for First American Financial's Q4 2026 earnings at $1.78 EPS, Q3 2027 earnings at $1.94 EPS, Q4 2027 earnings at $1.90 EPS, FY2027 earnings at $7.17 EPS and FY2028 earnings at $7.34 EPS.

First American Financial (NYSE:FAF - Get Free Report) last announced its quarterly earnings results on Wednesday, April 22nd. The insurance provider reported $1.33 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.06 by $0.27. First American Financial had a return on equity of 12.58% and a net margin of 8.73%.The firm had revenue of $1.85 billion during the quarter, compared to the consensus estimate of $1.80 billion. During the same period in the prior year, the company posted $0.84 earnings per share. The firm's quarterly revenue was up 16.2% compared to the same quarter last year.

A number of other brokerages have also recently weighed in on FAF. Weiss Ratings raised shares of First American Financial from a "buy (b-)" rating to a "buy (b)" rating in a research report on Wednesday, April 22nd. Truist Financial lifted their target price on First American Financial from $82.00 to $85.00 and gave the stock a "buy" rating in a research report on Friday, April 24th. Stephens reissued an "overweight" rating and issued a $84.00 target price on shares of First American Financial in a report on Friday, June 12th. Wall Street Zen downgraded First American Financial from a "buy" rating to a "hold" rating in a report on Saturday, May 2nd. Finally, Barclays raised their price target on First American Financial from $72.00 to $80.00 and gave the stock an "overweight" rating in a research note on Friday, April 24th. Six investment analysts have rated the stock with a Buy rating and one has given a Hold rating to the company's stock. According to data from MarketBeat, the company currently has an average rating of "Moderate Buy" and an average target price of $83.25.

First American Financial Trading Down 2.8%

Shares of First American Financial stock opened at $65.35 on Friday. The company has a fifty day simple moving average of $67.45 and a 200-day simple moving average of $64.84. The stock has a market cap of $6.66 billion, a price-to-earnings ratio of 10.04, a PEG ratio of 0.65 and a beta of 1.24. First American Financial has a 12-month low of $53.09 and a 12-month high of $71.47.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently modified their holdings of the stock. Bank of America Corp DE grew its position in First American Financial by 42.1% in the 1st quarter. Bank of America Corp DE now owns 624,123 shares of the insurance provider's stock valued at $37,628,000 after buying an additional 184,896 shares during the last quarter. Amundi raised its position in First American Financial by 68.4% during the 1st quarter. Amundi now owns 9,628 shares of the insurance provider's stock worth $580,000 after buying an additional 3,909 shares during the last quarter. California State Teachers Retirement System lifted its stake in shares of First American Financial by 25.2% in the 1st quarter. California State Teachers Retirement System now owns 120,448 shares of the insurance provider's stock worth $7,262,000 after acquiring an additional 24,224 shares during the period. Royal Bank of Canada lifted its stake in shares of First American Financial by 66.3% in the 1st quarter. Royal Bank of Canada now owns 88,582 shares of the insurance provider's stock worth $5,340,000 after acquiring an additional 35,315 shares during the period. Finally, Empowered Funds LLC boosted its holdings in shares of First American Financial by 60.8% in the first quarter. Empowered Funds LLC now owns 7,652 shares of the insurance provider's stock valued at $461,000 after acquiring an additional 2,892 shares in the last quarter. 89.05% of the stock is currently owned by hedge funds and other institutional investors.

Insider Transactions at First American Financial

In related news, Director Margaret M. Mccarthy sold 6,630 shares of the business's stock in a transaction dated Friday, April 24th. The stock was sold at an average price of $70.59, for a total value of $468,011.70. Following the transaction, the director owned 24,024 shares in the company, valued at $1,695,854.16. The trade was a 21.63% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available at the SEC website. Also, SVP Lisa W. Cornehl sold 5,823 shares of the company's stock in a transaction that occurred on Tuesday, May 5th. The shares were sold at an average price of $68.63, for a total value of $399,632.49. Following the sale, the senior vice president directly owned 29,635 shares of the company's stock, valued at approximately $2,033,850.05. This represents a 16.42% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. 3.50% of the stock is currently owned by corporate insiders.

First American Financial Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Monday, June 15th. Stockholders of record on Monday, June 8th were issued a $0.55 dividend. This represents a $2.20 dividend on an annualized basis and a dividend yield of 3.4%. The ex-dividend date of this dividend was Monday, June 8th. First American Financial's dividend payout ratio is presently 33.79%.

Trending Headlines about First American Financial

Here are the key news stories impacting First American Financial this week:

• Positive Sentiment: Keefe, Bruyette & Woods kept an outperform rating on First American Financial and said the stock still implies meaningful upside, even after cutting its price target from $87 to $84. Keefe, Bruyette & Woods lowers price target on First American Financial
• Positive Sentiment: Zacks Research’s long-term forecasts still point to earnings growth, with FY2027 EPS estimated at $7.17 and FY2028 EPS at $7.34, suggesting the analyst still sees steady profitability ahead. Zacks Research earnings estimate updates for First American Financial
• Neutral Sentiment: Zacks Research also published articles highlighting FAF as a top dividend stock and a strong momentum stock, which may support investor interest but do not represent fresh company-specific catalysts. FAF top dividend stock article FAF strong momentum stock article
• Negative Sentiment: Zacks Research lowered near-term earnings estimates across multiple periods, including Q4 2026, FY2026, Q3 2027, Q4 2027, Q1 2028, and FY2028. Even though the reductions were small, repeated estimate cuts can signal softer expectations and contribute to a weaker stock tone. Zacks Research lowers First American Financial estimates

First American Financial Company Profile

First American Financial Corporation is a leading provider of title insurance, settlement services and diversified real estate-related data and analytics. Headquartered in Santa Ana, California, the company serves customers throughout the United States as well as in Canada, Europe, Latin America and Asia. Its business is built on the underwriting capabilities of its title insurance operations combined with comprehensive closing and escrow services for homebuyers, sellers, mortgage lenders and real estate professionals.

The company's title insurance segment issues policies that protect property owners and mortgage lenders against defects in titles, liens or encumbrances that can arise during real property transactions.

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