11/9/21
Hi all,
Here’s another new entry into the valuation series. Although the market is near all time highs, there are still values out there if you know how to look.
Remember to do your own due diligence and make sure the stock fits your risk tolerance and asset allocation.
Today’s stock is Fidelity National Financial – ticker symbol FNF
Fidelity National Financial offers title insurance, closing and escrow services, home warranties, notary services, as well as life insurance and annuity financial products.
Some metrics I look for –
Safety:
Dividend Safety Score – 58 – out of 99 – considered “safe”
Current Ratio (look for a number higher than 1, higher the better) – N/A
Debt to Equity (lower the better) – 0.30
Price to Book (lower the better) – 1.61
Payout Ratio – 19%
Estimated Earnings Growth Rate – 5 year – 8.10%
Dividend history:
Current Dividend: $1.76
Years of dividend increases: 10
Dividend growth rate – 5 year – 19.54%
Current yield: 3.53%
Valuation:
DCF model: $65.21
P/E Mean Reversion: $64.90
Dividend Yield Theory: $55.52
Average of the three valuations – $61.87
Analyst’s 1 year estimate- $62.40
Current price: $50.66 (11/08/21)
Potential discount – 22%
Commentary: I like FNF in that it is a financial company but not in the traditional way. Every time you buy, sell, or refinance your home or business property you will need FNF’s services. They are the market leader in title insurance. They are growing their dividend very fast and have a great current yield due to the discounted price today.
Let me know what you think!
Disclosure: I own shares of FNF