Improving Margins Add To Stewart Information Services Corporation's (STC) Growth Prospects

Stewart Information Services Corporation (NYSE:STC) is one of the 10 undervalued growth stocks for the next 5 years. On February 5, Stewart Information Services Corporation (NYSE:STC) reported strong financial results for the fourth quarter. The company posted revenue of $790.6 million for the quarter, beating consensus estimates of $774.95 million. Its Title segment drove much of the growth, with operating revenues rising 19%, supported by gains across both direct and agency title operations. This contributed to a 28% increase in title pretax income.

Domestic commercial revenues jumped 38%, led by growth in data centers and energy. The average fee per domestic commercial file surged 39% to roughly $27,000, compared to about $20,000 in the previous year. Agency operations also remained strong, generating $334 million in gross revenue, a 20% increase from last year. The company ended the quarter with approximately $480 million in total cash and investments, above statutory premium reserve requirements.

CEO Frederick Eppinger commented on the outlook by saying:

For the full year ’26, we fully expect to improve margins and deliver in the low teen range for this segment, and expect that our recent acquisition of MCS will help us improve our historical margin outlook.

Earlier, on February 2, Citizens JMP initiated coverage of Stewart Information Services Corporation (NYSE:STC) with a Buy rating and a $80 price target. The firm’s price target suggests a further 11.98% upside from the current levels.

Analysts Matthew Carletti, Karol Chmiel, and David Samar said:

With a refreshed and driven management team and an oligopolistic marketplace for title insurance, we believe Stewart has taken the necessary actions to drive strong growth and expand margins for the foreseeable future, even without the help of an improved housing market backdrop. 

Stewart Information Services Corporation (NYSE:STC) provides title insurance and real estate transaction-related services across the United States and internationally. It is engaged in examining, searching, closing, and insuring the title to real property.

While we acknowledge the potential of STC as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.