FAF - First American Financial stock gaps up after upgrade to Overweight at Stephens

• First American Financial ( NYSE: FAF ) shares advanced as much as 5% in Friday morning trading after Stephens upgraded the title insurance stock to Outperform from Equal Weight, calling it "one of the best/cleanest ways to play housing."
• The upbeat coverage comes one day after the company turned in stronger-than-expected fourth-quarter earnings, as "our expense management efforts and continued growth in investment income helped mitigate the impact of the challenging business environment," said Ken DeGiorgio, the company's CEO.
• Stephens pointed to FAF's compelling valuation, with the stock changing hands at 8.8 times forward EPS, according to a note written to clients.
• Also, FAF has "a dynamic model that has counter-cyclical offsets," and "it plays in an oligopolistic market where market share and pricing are stable (unlike many of its non-title resi brethren)."
• The Overweight rating disagrees with the Quant system rating of Hold and converges with the average Wall Street rating of Buy.
• Seeking Alpha contributor Gen Alpha viewed FAF as a Buy, citing the company's growing market share in home purchase and commercial transactions.

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