CTZ, STC, FAF: (title insurance co's). Given the price being paid for CTZ, FAF now looks undervalued to me. Pe, psr, p/bv look low. On the other hand, these ratios have all been lower prior to the past few years. Plus, we are talking about a cyclical business. Although, on the other hand again (I've got lots of other hands -g-), FAF is trying to reduce dependency on title insurance with their financing/banking, home warranty, and related businesses. I think (can't find my reference though) that this stock is or was a Marty Whitman holding in his fund and recommended several times by him in media interviews last year.
Overall, for value investors, I'd rate FAF now as fair-- okay to buy for diversified accounts. Not okay to buy for someone who looks at macroeconomic picture or must wait for bottoming out.
I've started a small position today in FAF @ 16 1/2.
Paul |
