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Stewart Information Services Corporation (STC)
Intrinsic Value (DCF)
Current$66.64
→
Intrinsic$34.94
-48%
$20.00$34.94$63.34
Market implies 21% growth for 5 years
Current price reflects execution expectations above 8% growth — not unreasonable for quality businesses.
At $67, the market prices in continued strong cash flow growth (21%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $20 → Bull $63. Current price implies expectations above the base case, closer to bull expectations.
| Discount ↓Growth → | 4% | 6% | 8% | 10% |
|---|---|---|---|---|
| 8% | $44 | $49 | $54 | $60 |
| 10% | $28 | $31 | $35 | $39 |
| 12% | $19 | $21 | $24 | $27 |
| 14% | $13 | $15 | $17 | $20 |
Bull Case
- Bull case ($63) with 10% growth, 9% discount rate
- Conservative 8% growth assumption is achievable based on track record
Bear Case
- Bear case ($20) implies 70% downside at 6% growth, 12% discount
- Price reflects 21% growth expectations vs 8% historical — high bar to clear
- Trading 48% above base case — execution must exceed assumptions to justify
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5-Year Net Income Projection
Year 1$79.17M
Year 2$85.51M
Year 3$92.35M
Year 4$99.74M
Year 5$107.72M
Terminal$1.58B
📐 Model Inputs
Growth Rate8.0%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Net Income$73.31MTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
DCF estimates based on historical growth rates extrapolated forward. Uses Net Income (FCF not meaningful for insurers). See FAQ below for full methodology.