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FAF vs MORN

FAF
First American Financial Corporation
BULLISH
Price
$70.87
Market Cap
$7.25B
Sector
Financial Services
AI Confidence
85%
MORN
Morningstar, Inc.
BEARISH
Price
$172.21
Market Cap
$6.82B
Sector
Financial Services
AI Confidence
85%

Valuation

P/E Ratio
FAF
10.9
MORN
19.41
Forward P/E
FAF
9.74
MORN
13.28
P/B Ratio
FAF
1.32
MORN
5.6
P/S Ratio
FAF
0.94
MORN
2.79
EV/EBITDA
FAF
5.93
MORN
12.72

Profitability

Gross Margin
FAF
63.87%
MORN
61.03%
Operating Margin
FAF
11.08%
MORN
21.71%
Profit Margin
FAF
8.73%
MORN
15.3%
ROE
FAF
12.8%
MORN
26.35%
ROA
FAF
3.94%
MORN
8.86%

Growth

Revenue Growth
FAF
16.2%
MORN
8.5%
Earnings Growth
FAF
70.4%
MORN
4.5%

Financial Health

Debt/Equity
FAF
0.51
MORN
1.03
Current Ratio
FAF
0.41
MORN
0.98
Quick Ratio
FAF
0.41
MORN
0.89

Dividends

Dividend Yield
FAF
3.09%
MORN
1.16%
Payout Ratio
FAF
33.69%
MORN
21.03%

AI Verdict

FAF BULLISH

FAF presents a compelling value opportunity, trading significantly below its Graham Number ($88.68) and Intrinsic Value ($191.75). While the Piotroski F-Score of 4/9 indicates stable rather than strong financial health, this is offset by explosive earnings growth of 70.4% YoY and a very attractive P/E ratio of 10.90. Despite a contradictory technical scorecard, recent price action is strongly bullish, trending toward 52-week highs. The company maintains a sustainable dividend profile with a low payout ratio of 33.69%.

Strengths
Significant undervaluation relative to Graham Number ($88.68) and Intrinsic Value ($191.75)
Exceptional earnings growth (70.4% YoY) and strong Q/Q revenue growth (21.74%)
Low P/E ratio (10.90) compared to the broader financial services sector average
Risks
High PEG ratio (2.98) suggests that current growth may be difficult to sustain or is already priced in
Low current ratio (0.41) indicates potential short-term liquidity tightness
Piotroski F-Score of 4/9 suggests mediocre operational efficiency improvements
MORN BEARISH

MORN presents a stable but mediocre Piotroski F-Score of 4/9 and lacks a provided Altman Z-Score, indicating a neutral health baseline. The stock is trading at a significant premium to both its Graham Number ($78.33) and Intrinsic Value ($121.96), suggesting substantial overvaluation. This fundamental gap is compounded by a completely bearish technical trend (0/100) and aggressive insider selling totaling over $25M. While the company maintains a strong ROE of 26.35%, the combination of negative price momentum and poor insider sentiment outweighs the optimistic analyst target prices.

Strengths
Strong Return on Equity (ROE) of 26.35%
High Gross Margins (61.03%) and Operating Margins (21.71%)
Consistent earnings beat track record (3 of last 4 quarters)
Risks
Significant overvaluation relative to Graham and Intrinsic value models
Strongly bearish insider activity (14 sells, 0 buys)
Severe negative price momentum (-38.6% 1Y change)

Compare Another Pair

FAF vs MORN: Head-to-Head Comparison

This page compares First American Financial Corporation (FAF) and Morningstar, Inc. (MORN) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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