STEWART INFORMATION SERVICES (STC) Stock Fundamental Analysis
NYSE:STC - New York Stock Exchange, Inc. - US8603721015 - Common Stock - Currency: USD
STC gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 144 industry peers in the Insurance industry. Both the profitability and financial health of STC have multiple concerns. STC is not overvalued while it is showing excellent growth. This is an interesting combination.
1. Profitability
1.1 Basic Checks
In the past year STC was profitable.
STC had a positive operating cash flow in the past year.
In the past 5 years STC has always been profitable.
STC had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.18%, STC is in line with its industry, outperforming 49.30% of the companies in the same industry.
STC's Return On Equity of 4.22% is on the low side compared to the rest of the industry. STC is outperformed by 70.42% of its industry peers.
With a decent Return On Invested Capital value of 3.35%, STC is doing good in the industry, outperforming 69.01% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for STC is in line with the industry average of 4.55%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.18% | ||
| ROE | 4.22% | ||
| ROIC | 3.35% |
ROA(3y)3.25%
ROA(5y)5.81%
ROE(3y)6.45%
ROE(5y)12%
ROIC(3y)4.94%
ROIC(5y)7.83%
1.3 Margins
STC's Profit Margin of 2.47% is on the low side compared to the rest of the industry. STC is outperformed by 69.01% of its industry peers.
In the last couple of years the Profit Margin of STC has declined.
Looking at the Operating Margin, with a value of 4.41%, STC is doing worse than 72.54% of the companies in the same industry.
In the last couple of years the Operating Margin of STC has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.41% | ||
| PM (TTM) | 2.47% | ||
| GM | N/A |
OM growth 3Y-25.96%
OM growth 5Y-2.93%
PM growth 3Y-32.98%
PM growth 5Y-6.19%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), STC is destroying value.
The number of shares outstanding for STC has been increased compared to 1 year ago.
Compared to 5 years ago, STC has more shares outstanding
Compared to 1 year ago, STC has an improved debt to assets ratio.
2.2 Solvency
The Debt to FCF ratio of STC is 6.30, which is on the high side as it means it would take STC, 6.30 years of fcf income to pay off all of its debts.
STC's Debt to FCF ratio of 6.30 is on the low side compared to the rest of the industry. STC is outperformed by 68.31% of its industry peers.
A Debt/Equity ratio of 0.32 indicates that STC is not too dependend on debt financing.
The Debt to Equity ratio of STC (0.32) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 6.3 | ||
| Altman-Z | N/A |
ROIC/WACC0.42
WACC7.9%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 77.37% over the past year.
STC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.13% yearly.
Looking at the last year, STC shows a quite strong growth in Revenue. The Revenue has grown by 10.35% in the last year.
The Revenue has been growing slightly by 5.12% on average over the past years.
EPS 1Y (TTM)77.37%
EPS 3Y-32.99%
EPS 5Y8.13%
EPS Q2Q%86.67%
Revenue 1Y (TTM)10.35%
Revenue growth 3Y-9.01%
Revenue growth 5Y5.12%
Sales Q2Q%14.39%
3.2 Future
STC is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 31.05% yearly.
Based on estimates for the next years, STC will show a quite strong growth in Revenue. The Revenue will grow by 9.02% on average per year.
EPS Next Y45.06%
EPS Next 2Y40.54%
EPS Next 3Y31.05%
EPS Next 5YN/A
Revenue Next Year11.42%
Revenue Next 2Y11.99%
Revenue Next 3Y9.02%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 20.52, the valuation of STC can be described as rather expensive.
71.13% of the companies in the same industry are cheaper than STC, based on the Price/Earnings ratio.
STC is valuated rather cheaply when we compare the Price/Earnings ratio to 29.62, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 14.14, the valuation of STC can be described as correct.
The rest of the industry has a similar Price/Forward Earnings ratio as STC.
The average S&P500 Price/Forward Earnings ratio is at 22.70. STC is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.52 | ||
| Fwd PE | 14.14 |
4.2 Price Multiples
STC's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, STC is valued a bit more expensive than 66.20% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.15 | ||
| EV/EBITDA | 12.96 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as STC's earnings are expected to grow with 31.05% in the coming years.
PEG (NY)0.46
PEG (5Y)2.52
EPS Next 2Y40.54%
EPS Next 3Y31.05%
5. Dividend
5.1 Amount
STC has a Yearly Dividend Yield of 2.92%.
STC's Dividend Yield is a higher than the industry average which is at 3.17.
Compared to an average S&P500 Dividend Yield of 2.27, STC pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.92% |
5.2 History
On average, the dividend of STC grows each year by 9.20%, which is quite nice.
STC has been paying a dividend for at least 10 years, so it has a reliable track record.
STC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.2%
Div Incr Years3
Div Non Decr Years14
5.3 Sustainability
STC pays out 89.31% of its income as dividend. This is not a sustainable payout ratio.
STC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP89.31%
EPS Next 2Y40.54%
EPS Next 3Y31.05%
NYSE:STC (2/24/2025, 10:08:18 AM)
69.14
+0.19 (+0.28%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners101.25%
Inst Owner Change-86.36%
Ins Owners1.59%
Ins Owner Change-2.34%
Market Cap1.92B
Analysts77.14
Price Target80.58 (16.55%)
Short Float %2.35%
Short Ratio3.43
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.92% |
Yearly Dividend1.85
Dividend Growth(5Y)9.2%
DP89.31%
Div Incr Years3
Div Non Decr Years14
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-4.44%
Min EPS beat(2)-20.27%
Max EPS beat(2)11.39%
EPS beat(4)3
Avg EPS beat(4)58.3%
Min EPS beat(4)-20.27%
Max EPS beat(4)229.47%
EPS beat(8)4
Avg EPS beat(8)20.07%
EPS beat(12)7
Avg EPS beat(12)21.4%
EPS beat(16)11
Avg EPS beat(16)29.35%
Revenue beat(2)1
Avg Revenue beat(2)1.06%
Min Revenue beat(2)-0.78%
Max Revenue beat(2)2.89%
Revenue beat(4)3
Avg Revenue beat(4)1.36%
Min Revenue beat(4)-0.78%
Max Revenue beat(4)2.89%
Revenue beat(8)5
Avg Revenue beat(8)0.31%
Revenue beat(12)8
Avg Revenue beat(12)5.17%
Revenue beat(16)12
Avg Revenue beat(16)7.91%
PT rev (1m)-4.82%
PT rev (3m)-1.86%
EPS NQ rev (1m)-12.02%
EPS NQ rev (3m)-12.02%
EPS NY rev (1m)-15.19%
EPS NY rev (3m)-16.41%
Revenue NQ rev (1m)0.7%
Revenue NQ rev (3m)0.7%
Revenue NY rev (1m)-2.66%
Revenue NY rev (3m)-3.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.52 | ||
| Fwd PE | 14.14 | ||
| P/S | 0.8 | ||
| P/FCF | 27.15 | ||
| P/OCF | 17.92 | ||
| P/B | 1.36 | ||
| P/tB | 12.69 | ||
| EV/EBITDA | 12.96 |
EPS(TTM)3.37
EY4.87%
EPS(NY)4.89
Fwd EY7.07%
FCF(TTM)2.55
FCFY3.68%
OCF(TTM)3.86
OCFY5.58%
SpS86.71
BVpS50.69
TBVpS5.45
PEG (NY)0.46
PEG (5Y)2.52
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.18% | ||
| ROE | 4.22% | ||
| ROCE | 4.41% | ||
| ROIC | 3.35% | ||
| ROICexc | 3.63% | ||
| ROICexgc | 10.55% | ||
| OM | 4.41% | ||
| PM (TTM) | 2.47% | ||
| GM | N/A | ||
| FCFM | 2.94% |
ROA(3y)3.25%
ROA(5y)5.81%
ROE(3y)6.45%
ROE(5y)12%
ROIC(3y)4.94%
ROIC(5y)7.83%
ROICexc(3y)5.48%
ROICexc(5y)9.61%
ROICexgc(3y)16.38%
ROICexgc(5y)26.49%
ROCE(3y)6.49%
ROCE(5y)10.3%
ROICexcg growth 3Y-36.55%
ROICexcg growth 5Y0.5%
ROICexc growth 3Y-35.76%
ROICexc growth 5Y-12.31%
OM growth 3Y-25.96%
OM growth 5Y-2.93%
PM growth 3Y-32.98%
PM growth 5Y-6.19%
GM growth 3YN/A
GM growth 5YN/A
F-Score8
Asset Turnover0.88
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 6.3 | ||
| Debt/EBITDA | 2.65 | ||
| Cap/Depr | 59.08% | ||
| Cap/Sales | 1.51% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 63.79% | ||
| Profit Quality | 119.04% | ||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z | N/A |
F-Score8
WACC7.9%
ROIC/WACC0.42
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)77.37%
EPS 3Y-32.99%
EPS 5Y8.13%
EPS Q2Q%86.67%
EPS Next Y45.06%
EPS Next 2Y40.54%
EPS Next 3Y31.05%
EPS Next 5YN/A
Revenue 1Y (TTM)10.35%
Revenue growth 3Y-9.01%
Revenue growth 5Y5.12%
Sales Q2Q%14.39%
Revenue Next Year11.42%
Revenue Next 2Y11.99%
Revenue Next 3Y9.02%
Revenue Next 5YN/A
EBIT growth 1Y28.74%
EBIT growth 3Y-32.63%
EBIT growth 5Y2.05%
EBIT Next Year120.18%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y169.43%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y56.61%
OCF growth 3YN/A
OCF growth 5YN/A