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Fidelity National Financial, Inc. (FNF) Intrinsic Value

DCF-based fair value calculation with Bear, Base, and Bull scenarios

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Fidelity National Financial, Inc. (FNF)

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Intrinsic Value (DCF)

Current$52.73
→
Intrinsic$85.24
+62%
$56.79$85.24$139.34
Market implies 1% growth for 5 years
DCF analysis suggests FNF could have 62% upside at 10% growth — verify assumptions match your view.
At $53, the market prices in only 1% growth — below historical 10%, suggesting low expectations.
Range: Bear $57 → Bull $139. Current price implies expectations below the bear case — very conservative expectations.
Discount ↓Growth →6%8%10%12%
8%$102$112$122$133
10%$71$78$85$93
12%$54$59$65$70
14%$43$47$52$56

Bull Case

  • Bull case ($139) offers 164% upside at 11% growth, 9% discount
  • Price below even worst-case scenario — strong margin of safety
  • Market-implied growth (1%) ≤ historical CAGR (10%)

Bear Case

  • Bear case ($57) with 8% growth, 12% discount rate
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5-Year Net Income Projection

Year 1$1.39B
Year 2$1.52B
Year 3$1.67B
Year 4$1.83B
Year 5$2.00B
Terminal$29.47B

📐 Model Inputs

Growth Rate9.5%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Net Income$1.27BTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
ℹ️

DCF estimates based on historical growth rates extrapolated forward. Uses Net Income (FCF not meaningful for insurers). See FAQ below for full methodology.

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Frequently Asked Questions

Is FNF stock undervalued or overvalued?
🟢 UNDERVALUED

FNF trades at $52.73 vs. our DCF-derived intrinsic value of $85.24, implying +51% upside. At a 10.0% WACC and 9.5% projected FCF growth, the market appears to be underpricing the present value of FNF's future cash flows. The bear case ($59.56) still suggests upside, providing margin of safety.

What is FNF's intrinsic value?

Using a 5-year DCF model: Base FCF of $1.27B, projected at 9.5% 5Y CAGR (best of revenue, EPS, or FCF growth), discounted at 10.0% WACC, with 3.0% terminal growth. Terminal value calculated via Gordon Growth Model: TV = FCF₅ × (1+g) / (WACC−g). After deducting $1.30B net debt and dividing by 0.27B shares: Bear $59.56 | Base $85.24 | Bull $120.08. Current price $52.73 implies +51% to base case.

How is FNF's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 9.5% growth derived from 5-year historical CAGR (best of revenue, EPS, or FCF growth, with 8% floor and 25% cap).

② Calculate terminal value at year 5 using perpetuity growth model with g=3.0%.

③ Discount all cash flows to PV using WACC=10.0%.

④ Sum PV of explicit period + PV of terminal value = Enterprise Value ($24.57B).

⑤ Subtract net debt, divide by shares outstanding.

Sensitivity analysis available above—adjust WACC ±2% or growth ±3% to stress-test the valuation. Implied EV/FCF multiple: 19.3x.