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The market expects First American Financial (FAF - Free Report) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended September 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.

The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on October 21. On the other hand, if they miss, the stock may move lower.

While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise.

Zacks Consensus EstimateThis financial services company is expected to post quarterly earnings of $1.85 per share in its upcoming report, which represents a year-over-year change of +8.8%.

Revenues are expected to be $2.13 billion, up 7.5% from the year-ago quarter.

Estimate Revisions TrendThe consensus EPS estimate for the quarter has been revised 0.37% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.

Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts.

Price, Consensus and EPS Surprise

Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction).

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.

A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.

Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).

How Have the Numbers Shaped Up for First American Financial?For First American Financial, the Most Accurate Estimate is the same as the Zacks Consensus Estimate, suggesting that there are no recent analyst views which differ from what have been considered to derive the consensus estimate. This has resulted in an Earnings ESP of 0%.

On the other hand, the stock currently carries a Zacks Rank of #2.

So, this combination makes it difficult to conclusively predict that First American Financial will beat the consensus EPS estimate.

Does Earnings Surprise History Hold Any Clue?Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.

For the last reported quarter, it was expected that First American Financial would post earnings of $1.8 per share when it actually produced earnings of $2.08, delivering a surprise of +15.56%.

Over the last four quarters, the company has beaten consensus EPS estimates four times.

Bottom LineAn earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.

That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

First American Financial doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.

An Industry Player's Expected ResultsAnother stock from the Zacks Insurance - Property and Casualty industry, Chubb (CB - Free Report) , is soon expected to post earnings of $6.42 per share for the quarter ended September 2026. This estimate indicates a year-over-year change of -14.3%. Revenues for the quarter are expected to be $16.72 billion, up 3.6% from the year-ago quarter.

The consensus EPS estimate for Chubb has been revised 0.1% lower over the last 30 days to the current level. However, a lower Most Accurate Estimate has resulted in an Earnings ESP of -0.10%.

When combined with a Zacks Rank of #3 (Hold), this Earnings ESP makes it difficult to conclusively predict that Chubb will beat the consensus EPS estimate. The company beat consensus EPS estimates in each of the trailing four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

Key Takeaways First American increased its quarterly dividend 11% to 61 cents per share. The company had $239.4 million in cash and $900 million available on its revolving credit facility. First American repurchased 0.9 million shares for $54 million in the first half of 2026. First American Financial Corporation (FAF - Free Report) recently announced a substantial increase in its quarterly cash dividend, underscoring its commitment to rewarding shareholders. The move reflects confidence in First American’s business prospects and its continued commitment to returning capital to shareholders.

Approved by the board of directors, the quarterly cash dividend has now been increased to 61 cents per share of common stock from 55 cents. This increase represents a remarkable 11% rise over the previously declared rate. This move is a testament to the insurer’s strong financial position and long-term growth prospects.

Based on the stock’s Sept. 16 closing price of $71.11, the new dividend will yield 3.1%, which is better than the industry average of 0.2%. Also, the payout ratio of 30.99 compares favorably with the industry average of 10.43. This makes First American an attractive pick for yield-seeking investors. Shareholders of record on Sept. 28 will receive the increased dividend on Oct. 5.

Historically, FAF has a solid track record of dividend increases, with the metric witnessing a nine-year (2018-2026) CAGR of 5.4%.

Financial Strength and Capital ManagementFAF remains committed to returning capital to shareholders through a combination of dividends and opportunistic share repurchases and expects to continue increasing dividends over time, reflecting confidence in the company's long-term earnings growth.

First American maintains a stock repurchase plan with authorization up to $300 million of the company’s common stock, of which $246 million remained as of June 30, 2026. During the six months ended June 30, 2026, the company repurchased and retired 0.9 million shares of its common stock for a total purchase price of $54 million.

The dividend hike and the increase in repurchase authorization reflect the insurer’s strong financial condition, liquidity, and long-standing commitment to returning capital to stockholders. First American enjoys a strong liquidity position to enhance operating leverage. Its strong liquidity not only mitigates balance sheet risks but also paves the way for accelerated capital deployment.

As of June 30, 2026, the holding company’s liquidity sources included $239.4 million of cash and cash equivalents and $900 million available on the company’s revolving credit facility. Management believes the holding company’s liquidity is sufficient to meet anticipated cash requirements and obligations for at least the next 12 months.

Return on equity, a profitability measure of how efficiently a company utilizes its shareholders' money, was 13.3% in the trailing 12 months, which compared favorably with the industry average of 7.5%.

Robust operational performance, solid investment performance and strong capital management are likely to help FAF in sustaining the dividend streak.

Zacks Rank and Price PerformanceShares of this Zacks Rank #3 (Hold) title insurer have gained 15.7% year to date, outperforming the industry’s growth of 4%. FAF’s policy of ramping up growth and capital position should help the stock retain momentum.

Image Source: Zacks Investment Research

Other Insurers on the Same PathAmerican Financial Group (AFG - Free Report) announced a substantial increase in its annual common stock dividend in August 2026. Approved by the board of directors, the regular annual dividend has now been increased to $3.88 per share of common stock from $3.52. This increase represents a remarkable 10.2% rise over the previously declared rate. Effective October 2026, the increased dividend will be paid quarterly at 97 cents per share of common stock. The latest hike marks the 21st consecutive year of dividend increases.

AFG's compelling and diversified mix of specialty insurance businesses, entrepreneurial culture, disciplined operating philosophy and an astute team of in-house investment professionals continue to position it to create value for shareholders through a variety of insurance market conditions.

Unum Group (UNM - Free Report) is reinforcing its commitment to shareholder returns with a new $1 billion share repurchase authorization. Approved by the board of directors on Aug. 26, 2026, the program will begin on Sept. 1, 2026, immediately following the expiration of the company's existing repurchase program on Aug. 31, 2026. Under the new authorization, Unum can repurchase up to $1 billion of its common stock from time to time, with the timing and amount determined by management based on market conditions and other considerations.

The buyback should be considered within UNM's broader capital-allocation framework. UNM continues to balance share repurchases, dividends, investments in its businesses, and capital requirements associated with its insurance operations.

Another Stock to ConsiderA better-ranked stock from the property and casualty insurance industry is Mercury General Corporation (MCY - Free Report) , which sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Mercury General’s earnings surpassed estimates in each of the last four quarters, the average surprise being 70.21%. Shares of MCY have jumped 8.4% in the year-to-date period. The Zacks Consensus Estimate for MCY’s 2026 earnings implies year-over-year growth of 61.3%.

First American Title Insurance Company, a leading provider of title insurance and settlement services and the largest subsidiary of First American Financial Corporation (NYSE: FAF), today announced that its policy-issuing title agents can now offer their eligible clients a property title monitoring and fraud alert service at no additional cost when their residential owner’s title insurance policy is underwritten by First American Title. Earlier this year, First American Title launched no-cost property title monitoring for customers who close their transactions directly through the company, and the company is now extending comparable protection to homeowners served by the company’s extensive network of independent title agents.

Proactive monitoring for potentially fraudulent activity has never been more valuable amid rising real estate fraud risk, and First American Title’s property title monitoring extends an important layer of protection to homeowners. According to the FBI’s Internet Crime Report, cybercrime-related losses reached a record $20.9 billion in 2025, and increasingly sophisticated fraudsters are targeting the near-record levels of equity held by U.S. homeowners.

“Title agents are trusted advisors to the home buyers and homeowners they serve, and they are looking for meaningful ways to help protect their clients,” said Steve Vincini, president of First American Title’s Agency Division. “By making title monitoring available through our agents on all eligible owner’s title policies underwritten by First American, we’re providing an added layer of protection against the growing threat of real estate fraud and helping homeowners stay connected to trusted title professionals long after their purchase is complete at no additional cost.”

Monitoring Paired with the Protection of Title Insurance

The no-cost property title monitoring service is available to homeowners when their residential owner’s title insurance policy is underwritten by First American Title. The property title monitoring service alerts homeowners to new filings, such as deeds, liens, or property listings, that may affect their ownership, helping them identify potentially suspicious activity and take action early. Unlike standalone monitoring products, the service is paired with a title insurance policy issued by First American Title. Homeowners seeking enhanced protection against post-policy fraud and forgery may elect an Eagle Policy® or an ALTA 49 endorsement at closing, where available. After closing, eligible homeowners may add an ALTA 49.1 endorsement to an existing policy for additional coverage, subject to availability and underwriting requirements.

Deepening Title Agent Relationships with Homeowners

For title agents, the service represents an opportunity to deepen client relationships that extend well beyond the closing table. First American Title provides participating agents with informative client education materials and enrollment support to help make signing up for the service simple.

The property title monitoring service is available through participating First American Title agents in all states except Vermont with some county-level restrictions in other states. To qualify, a property must:

Be covered by an owner’s policy underwritten by First American Title (loan or lender’s policies are not eligible)Have a valid street address (vacant land is eligible if it has a street address)Be residential or new-home construction (commercial properties are not eligible)How to Learn More

Title agents interested in offering property title monitoring to their clients can contact their First American Title Agency Representative or visit AgentNet® Services at https://agentnet.firstam.com. For tips on spotting and preventing fraud, visit First American Title’s Fraud Center.

No-Cost Property Title Monitoring for Title Agents and their Clients: Frequently Asked Questions

Q: What did First American Title announce?

A: First American Title’s Agency Division is making the company’s property title monitoring and fraud alert service available through its independent title agents, enabling agents to offer their homeowner clients early warnings of potentially suspicious property filings at no additional cost when their residential owner’s title insurance policy is underwritten by First American Title.

Q: What does the service monitor?

A: The service monitors any new listings that could signal an attempt to sell the property in question, as well as public records, alerting homeowners to new filings, such as deeds or liens, that may affect property ownership, helping detect potentially fraudulent activity early.

Q: How much does the service cost?

A: The service is available to any homeowner or home buyer with an owner’s title insurance policy underwritten by First American Title at no additional cost to the homeowner or their title agent. Loan or lender’s policies are not eligible.

Q: Which properties are eligible?

A: The property must be covered by an owner’s policy underwritten by First American Title, have a valid street address, be residential or new home construction. Vacant land is eligible if it has a street address. Commercial properties are not eligible.

Q: Which states are supported?

A: The service is available through participating First American Title policy-issuing agents in all states except Vermont with some county-level restrictions in other states.

Q: How does an agent offer the service to a client?

A: First American Title policy-issuing agents can log into AgentNet® Services, where they can create a branded QR code to invite their clients to enroll in no-cost title monitoring. To activate their title monitoring service, clients must accept the terms and conditions.

Q: How is this different from standalone title monitoring products?

A: Unlike standalone monitoring services, First American Title’s offering is paired with a title insurance policy underwritten by First American. Homeowners seeking enhanced protection against post-policy fraud and forgery may elect an Eagle Policy or an ALTA 49 endorsement at closing, where available. After closing, eligible homeowners may also add an ALTA 49.1 endorsement to an existing title insurance policy from First American Title for additional coverage, subject to availability and underwriting requirements.

Q: How does this relate to the announcement First American Title made in January?

A: In January 2026, First American Title launched property title monitoring for customers who close transactions directly through its Direct Division. Today’s announcement extends comparable protection to homeowners served by the company’s extensive network of independent title agents.

Q: Where can title agents learn more?

A: Agents can contact their First American Title Agency Representative or visit AgentNet® Services at https://agentnet.firstam.com.

About First American Title Insurance Company

First American Title Insurance Company, the largest subsidiary of First American Financial Corporation (NYSE: FAF), traces its history to 1889. One of the largest title insurers in the nation, the company offers title services through its direct operations and an extensive network of agents throughout the United States and abroad. First American Title provides comprehensive title insurance coverage and professional services for real estate purchases, construction, refinances, and equity loans. For more information, visit www.firstam.com/title.

About First American

First American Financial Corporation (NYSE: FAF) is a premier provider of title, settlement and risk solutions for real estate transactions. With its combination of financial strength and stability built over more than 135 years, innovative proprietary technologies, and unmatched data assets, the company is leading the digital transformation of its industry. First American also provides data products to the title industry and other third parties; valuation products and services; mortgage subservicing; home warranty products; banking, trust and wealth management services; and other related products and services. With total revenue of $7.5 billion in 2025, the company offers its products and services directly and through its agents throughout the United States and abroad. In 2026, First American was named one of the 100 Best Companies to Work For by Great Place to Work® and Fortune Magazine for the eleventh consecutive year. More information about the company can be found at www.firstam.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260914916973/en/

Key Takeaways Home Warranty revenues rose 3% to $113.8 million, while pretax income increased 9% to $24.2 million. The segment's pretax margin grew 21.3%, supported by favorable claims experience and lower claim frequency. Renewal-based warranty policies offer recurring revenues that cushions FAF when real estate activity weakens. First American Financial Corporation’s (FAF - Free Report) Home Warranty business can support long-term growth by providing recurring revenues, strong profitability and greater earnings diversification beyond its cyclical title-insurance operations.

Home Warranty generates relatively recurring revenues from customers seeking protection against unexpected home-system and appliance repair costs. This provides FAF with a more stable earnings stream than its transaction-sensitive title business. In the second quarter of 2026, Home Warranty generated $113.8 million of revenues, up 3% year over year, while pretax income increased 9% to $24.2 million. The pretax margin improved to 21.3% from 20.2%, reflecting solid profitability.

The segment’s claims experience also remains favorable. Its claim loss rate declined to 40% from 41% in the second quarter of 2026, primarily due to lower claim frequency, although higher claim severity partly offset the improvement. Continued control over claim frequency and severity should be important for maintaining margins.

Home Warranty also strengthens FAF’s business diversification by expanding its exposure to the broader homeownership and home-maintenance ecosystem, rather than relying primarily on real-estate transactions. When housing activity or mortgage originations weaken, the segment can help cushion FAF’s earnings because its revenues are not directly dependent on title order volumes.

Furthermore, renewal-based warranty policies can provide a more predictable source of revenue between real-estate transaction cycles. This recurring earnings stream can complement FAF’s title-insurance operations and improve the overall resilience of its business model.
Overall, Home Warranty could become an increasingly important stabilizing earnings engine for FAF. Its recurring revenues, strong margins and favorable claims trends can help offset volatility in the title business and support sustainable long-term profitability, provided FAF continues to manage claim costs effectively.

What About Other Players?    Fidelity National Financial, Inc. (FNF - Free Report) operates its Home Warranty business through Fidelity National Home Warranty, which protects against unexpected repair or replacement costs for major home appliances and systems. Home Warranty is included within FNF’s Title segment, alongside title insurance, escrow and other title-related services. The business also complements FNF’s core real-estate operations by providing an additional service to homeowners and real-estate customers.

Old Republic International Corporation (ORI - Free Report) operates its Home Warranty business through Old Republic Home Warranty, a subsidiary that has been part of ORI since 1982. The business provides home warranty plans that cover the repair or replacement of major home systems and appliances when they fail because of normal wear and use, including heating, air conditioning, plumbing, electrical systems and kitchen appliances. The business serves both homeowners and real-estate professionals, making its warranties particularly relevant during home-buying and selling transactions. It also offers optional coverage that allows customers to tailor plans to their specific needs.

FAF’s Price PerformanceShares of FAF have gained 8.3% in the past year, outperforming the industry.

Image Source: Zacks Investment Research

FAF’s UndervaluationThe stock is undervalued compared with its industry. It is currently trading at a price-to-book value multiple of 1.3, lower than the industry average of 1.41. It carries a Value Score of A.

Image Source: Zacks Investment Research

Estimate Movement for FAFThe Zacks Consensus Estimate for FAF’s third-quarter and fourth-quarter 2026 EPS has moved up 6.8% and 2.8%, respectively, in the past 30 days. The same for the full-year 2026 and 2027 EPS has moved up 5.5% and 3.6%, respectively, in the past 30 days.

Image Source: Zacks Investment Research

First American Financial (FAF - Free Report) came out with quarterly earnings of $2.08 per share, beating the Zacks Consensus Estimate of $1.8 per share. This compares to earnings of $1.53 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of +15.56%. A quarter ago, it was expected that this financial services company would post earnings of $1.06 per share when it actually produced earnings of $1.33, delivering a surprise of +25.47%.

Over the last four quarters, the company has surpassed consensus EPS estimates four times.

First American Financial, which belongs to the Zacks Insurance - Property and Casualty industry, posted revenues of $2.12 billion for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 4.43%. This compares to year-ago revenues of $1.84 billion. The company has topped consensus revenue estimates four times over the last four quarters.

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

First American Financial shares have added about 16.6% since the beginning of the year versus the S&P 500's gain of 9.7%.

What's Next for First American Financial?While First American Financial has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for First American Financial was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.75 on $2.01 billion in revenues for the coming quarter and $6.74 on $7.88 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Insurance - Property and Casualty is currently in the bottom 36% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

United Fire Group (UFCS - Free Report) , another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 3.

This property and casualty insurance company is expected to post quarterly earnings of $0.72 per share in its upcoming report, which represents a year-over-year change of -20%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.

United Fire Group's revenues are expected to be $378.9 million, up 13% from the year-ago quarter.