First American Financial Corporation (FAF) vs MGIC Investment Corporation (MTG)

First American Financial Corporation and MGIC Investment Corporation are both Insurance Specialty companies. First American Financial Corporation is the larger, with a market value of $7.0B against $6.0B — 1.2× the size. MGIC Investment Corporation trades at the lower P/E: 9.1× against 9.5×. First American Financial Corporation grew revenue faster over the last twelve months: 14.1% against −2.16%. MGIC Investment Corporation has the higher net margin (58.1% vs 9.05%) and the lower return on invested capital (10.8% vs 14.7%). Both pay a dividend; First American Financial Corporation yields more (3.33% vs 1.61%). Across the 21 metrics below, MGIC Investment Corporation leads on 12 and First American Financial Corporation on 9.

Valuation

Metric FAF MTG Insurance Specialty median
P/E 9.54 9.09 9.49
P/S 0.86 5.02 1.69
P/B 1.29 1.23 1.23
Price to free cash flow 8.66 8.44 8.44
EV/EBITDA — — —
EV/Sales — — —
Earnings yield 10.48% 11.00% 10.48%
Free cash flow yield 11.55% 11.85% 10.87%

Profitability

Metric FAF MTG Insurance Specialty median
Gross margin 100.00% 76.64% 56.22%
Operating margin 15.19% 76.15% 15.19%
Net margin 9.05% 58.12% 13.80%
Free cash flow margin 9.96% 59.46% 34.47%
Return on equity 13.65% 13.81% 12.01%
Return on assets 4.12% 10.65% 3.55%
Return on invested capital 14.70% 10.75% 9.88%

Growth

Metric FAF MTG Insurance Specialty median
Revenue growth (TTM) 14.14% (2.16%) 7.68%
EPS growth (last fiscal year) 376.19% 8.65% 8.65%
Revenue growth, 5-year CAGR 1.01% 0.24% 2.24%
Net income growth, 5-year CAGR (2.23%) 10.60% 0.00%

Health

Metric FAF MTG Insurance Specialty median
Debt to equity 0.29 0.13 0.16
Current ratio 0.89 0.00 0.52
Net debt to EBITDA 0.13 0.28 0.28

Dividend

Metric FAF MTG Insurance Specialty median
Dividend yield 3.33% 1.61% 2.06%
Payout ratio 0.32 0.15 0.19

Size

Metric FAF MTG Insurance Specialty median
Market cap 6.96b 6.02b 3.31b

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