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In recent transactions, Dennis J. Gilmore, a director at First American Financial Corp (NYSE:FAF), sold a substantial portion of the company’s common stock. The sales, which occurred on February 14, 2025, involved a total of 111,971 shares. The shares were sold at prices ranging from $63.08 to $64.18, resulting in a total transaction value of approximately $7.1 million. The transaction comes as First American, currently valued at $6.67 billion, trades at a relatively high P/E ratio of 51.3. InvestingPro analysis indicates the stock may be overvalued at current levels.
Following these sales, Gilmore retains direct ownership of 494,574 shares. Additionally, he holds 2,343 shares indirectly through a 401(k) plan trust. These transactions reflect a significant divestment by Gilmore, though he still maintains a substantial stake in the company. Despite the insider sale, First American maintains strong fundamentals, including a 3.34% dividend yield and a 15-year streak of consecutive dividend increases. InvestingPro subscribers can access additional insights through the comprehensive Pro Research Report, including detailed analysis of insider trading patterns and company valuations.
In other recent news, First American Financial Corporation reported its fourth-quarter 2024 earnings, surpassing market expectations with an adjusted earnings per share of $1.35, exceeding the forecast of $1.10. The company also reported revenue of $1.7 billion, outperforming the anticipated $1.62 billion. The title segment saw a 22% increase in revenue year-over-year, while the commercial segment experienced a 47% rise. These results highlight the company’s robust performance in key areas despite broader market challenges.
Additionally, the company has been focusing on strategic initiatives, such as rebalancing its investment portfolio, which contributed to its financial success. Analysts from Deutsche Bank (ETR:DBKGn) and Barclays (LON:BARC) have shown interest in the company’s commercial market strength and growth potential in title revenue. The company remains optimistic about future growth, particularly in its commercial business, and expects modest improvements in the residential purchase and refinance markets.
Looking ahead, First American anticipates continued growth in investment income, despite potential Federal Reserve rate cuts. The company also sees opportunities in the home warranty market, driven by a more buyer-driven real estate market. The firm’s leadership expressed confidence in navigating the challenging conditions and maintaining a positive growth trajectory.
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