FAF vs MTG

For growth investors, First American Financial Corporation (FAF) is the stronger pick with 21.

6% revenue growth year-over-year, versus 0. 5% for MGIC Investment Corporation (MTG). MGIC Investment Corporation (MTG) offers the better valuation at 8. 4x trailing P/E (8. 5x forward), making it the more compelling value choice. Analysts rate First American Financial Corporation (FAF) a "Buy" — based on 15 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, MGIC Investment Corporation (MTG) is the cheapest at 8.

4x versus First American Financial Corporation at 11. 4x. On forward P/E, MGIC Investment Corporation is actually cheaper at 8. 5x.

Over the past 5 years, MGIC Investment Corporation (MTG) delivered a total return of +90.

0%, compared to +21. 0% for First American Financial Corporation (FAF). Over 10 years, the gap is even starker: MTG returned +324. 6% versus FAF's +137. 3%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), MGIC Investment Corporation (MTG) is the lower-risk stock at 0.

43β versus First American Financial Corporation's 0. 59β — meaning FAF is approximately 39% more volatile than MTG relative to the S&P 500. On balance sheet safety, MGIC Investment Corporation (MTG) carries a lower debt/equity ratio of 13% versus 35% for First American Financial Corporation — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), First American Financial Corporation (FAF) is pulling ahead at 21.

6% versus 0. 5% for MGIC Investment Corporation (MTG). On earnings-per-share growth, the picture is similar: First American Financial Corporation grew EPS 376. 2% year-over-year, compared to 8. 7% for MGIC Investment Corporation. Over a 3-year CAGR, MTG leads at 1. 1% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

MGIC Investment Corporation (MTG) is the more profitable company, earning 60.

8% net margin versus 8. 4% for First American Financial Corporation — meaning it keeps 60. 8% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: MTG leads at 76. 5% versus 11. 1% for FAF. At the gross margin level — before operating expenses — FAF leads at 95. 6%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

On forward earnings alone, MGIC Investment Corporation (MTG) trades at 8.

5x forward P/E versus 10. 7x for First American Financial Corporation — 2. 1x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for FAF: 21. 4% to $83. 00.

All stocks in this comparison pay dividends.

First American Financial Corporation (FAF) offers the highest yield at 3. 1%, versus 2. 2% for MGIC Investment Corporation (MTG).

For long-horizon retirement investors, MGIC Investment Corporation (MTG) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.

43), 2. 2% yield, +324. 6% 10Y return). Both have compounded well over 10 years (MTG: +324. 6%, FAF: +137. 3%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Financial Services sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

In terms of investment character: FAF is a small-cap high-growth stock; MTG is a small-cap deep-value stock. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.