Should I Buy FAF? FAF 2026 Analysis

Should You Buy First American Financial Corp (FAF) Today? Analysis, Price Targets, and 2026 Outlook.

Conclusion

Buy

Latest Price

67.340

1 Day change

0.37%

52 Week Range

68.750

Analysis Updated At

2026/02/04

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Buy now: Trend is firmly bullish (SMA_5 > SMA_20 > SMA_200, MACD expanding) and price is holding above the key pivot (64.31).
Options positioning is bullish-leaning (OI put/call 0.59) and hedge funds are aggressively accumulating (+166% QoQ buying), supporting continued upside.
Near-term upside is likely momentum-driven into the 66.15–67.28 resistance zone; earnings (Feb 11, after hours) is the next major catalyst.

Intellectia Proprietary Trading Signals

AI Stock Picker: No signal on given stock today.
SwingMax: No signal on given stock today.

Technical Analysis

Trend: Bullish structure with moving averages aligned positively (SMA_5 > SMA_20 > SMA_200).
Momentum: MACD histogram at +0.318 and expanding → upside momentum strengthening.
RSI: RSI_6 at 69.6 (near overbought threshold) → upside is intact but near-term chase risk is rising.
Key levels:
- Pivot (decision level): 64.31
- Resistance: 66.15 (R1) then 67.28 (R2)
- Support: 62.47 (S1) then 61.34 (S2)

Options Data

Bullish

Open Interest Put-Call Ratio

Bullish

Option Volume Put-Call Ratio

Open interest: Calls 1,052 vs Puts 625 → put/call OI 0.59 (bullish tilt / more call positioning).
Volume: Very light (total volume 4, puts 0) → sentiment read is directionally bullish but not strongly confirmed by activity.
Implied volatility: 30D IV 37.76 vs 5D avg IV 48.96 → IV has been coming down; IV rank 11.69 / percentile 38.65 suggests options are not priced at extremes.
Earnings proximity (Feb 11) can shift IV and drive a post-event move.

Technical Summary

Sell

Buy

Positive Catalysts

- Hedge funds buying: reported buying amount up 166% over last quarter (institutional tailwind).
- Bullish technical setup: positive momentum (MACD expanding) with bullish MA stack.
- Earnings catalyst ahead: QDEC 2025 earnings on 2026-02-11 (After Hours) can re-rate the stock if results/guide are strong.
- Street constructive pockets: Keefe Bruyette reiterates Outperform with $81 target; commentary points to longer-run mortgage/housing normalization potential.

Neutral/Negative Catalysts

- Profitability deterioration: latest reported quarter shows steep YoY declines in net income and EPS (see financials) — headline risk into earnings.
- Near resistance / stretched RSI: RSI near 70 and price approaching 66–67 resistance band could cap immediate upside.
- Pattern-based forward drift: similarity model implies -6.71% over the next month (despite modest next-day/week upside odds).
- No supportive news flow in the last week; upside is currently more technical/positioning-driven than narrative-driven.
- No notable insider/political accumulation: insiders neutral; no recent congress trading data.

Financial Performance

Latest quarter: 2025/Q3
- Revenue: $2.0146B, +43.09% YoY (top-line rebound/strength).
- Net Income: $189.6M, -282.31% YoY (major YoY decline).
- EPS: 1.84, -284.00% YoY (sharp drop).
Takeaway: strong revenue growth but earnings power weakened materially, making the upcoming earnings report a key confirmation point.

Growth

Profitability

Efficiency

Analyst Ratings and Price Target Trends

Recent rating/target trend: mixed-to-neutral overall with one notable bullish outlier.
- Barclays (2026-01-06): PT cut $71 → $68, keeps Equal Weight (more cautious).
- Keefe Bruyette (2025-12-18): PT raised $79 → $81, keeps Outperform (bullish).
- Stephens (2025-11-13): resumes Equal Weight, PT $70 (neutral, wants clearer catalysts).
Wall Street pros: high-quality, well-capitalized franchise; margin recovery potential; housing/mortgage environment could improve.
Wall Street cons: key catalysts depend on sustained housing recovery and execution of tech initiatives; near-term earnings quality is under scrutiny given YoY profit declines.

4 Analyst Rating

Wall Street analysts forecast FAF stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for FAF is 73.75 USD with a low forecast of 68 USD and a high forecast of 81 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.

2 Buy

2 Hold

0 Sell

Moderate Buy

Current: 67.090

Low

Averages

73.75

High

Current: 67.090

Low

Averages

73.75

High

Barclays

Equal Weight

downgrade

$71 -> $68

AI Analysis

2026-01-06

Reason

Barclays

Price Target

$71 -> $68

AI Analysis

2026-01-06

downgrade

Equal Weight

Reason

Barclays lowered the firm's price target on First American to $68 from $71 and keeps an Equal Weight rating on the shares. The firm sees additional upside in select consumer finance name in 2026. A "benign' credit environment sets the stage for loan growth, the analyst tells investors in a research note. Barclays also forecasts a better mortgage origination market in 2026. The firm adjusted price targets as part of its 2026 outlook.

Keefe Bruyette

Bose George

Outperform

maintain

$79 -> $81

2025-12-18

Reason

Keefe Bruyette

Bose George

Price Target

$79 -> $81

2025-12-18

maintain

Outperform

Reason

Keefe Bruyette analyst Bose George raised the firm's price target on First American to $81 from $79 and keeps an Outperform rating on the shares. The firm remains reasonably constructive on the mortgage insurers given the expectation that the companies will generate double-digit book value growth, the analyst tells investors in a research note.

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FAF Should I Buy

FAF Should I Buy

Should You Buy First American Financial Corp (FAF) Today? Analysis, Price Targets, and 2026 Outlook.

Technical Analysis

Options Data

Technical Summary

Positive Catalysts

Neutral/Negative Catalysts

Financial Performance

Growth

Profitability

Efficiency

Analyst Ratings and Price Target Trends

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