Why First American Financial (FAF) is a Top Momentum Stock for the Long-Term

Core Insights - Zacks Premium offers tools for investors to enhance their stock market engagement and confidence through daily updates, research reports, and stock screens [1] - The Zacks Style Scores are designed to help investors select stocks with the highest potential to outperform the market in the short term [2] Zacks Style Scores Overview - Stocks are rated A, B, C, D, or F based on value, growth, and momentum characteristics, with higher scores indicating better performance potential [3] - The Style Scores are categorized into four types: Value Score, Growth Score, Momentum Score, and VGM Score, each focusing on different investment strategies [3][4][5][6] Value Score - The Value Score identifies undervalued stocks using financial ratios such as P/E, PEG, and Price/Sales to find attractive investment opportunities [3] Growth Score - The Growth Score assesses a company's financial health and future growth potential by analyzing earnings, sales, and cash flow [4] Momentum Score - The Momentum Score helps investors capitalize on price trends by evaluating recent price changes and earnings estimate revisions [5] VGM Score - The VGM Score combines the three Style Scores to identify stocks with the best overall value, growth, and momentum characteristics [6] Zacks Rank Integration - The Zacks Rank utilizes earnings estimate revisions to simplify stock selection, with 1 (Strong Buy) stocks historically yielding an average annual return of +25.41% since 1988 [7][8] - To maximize returns, investors should focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [10] Company Spotlight: First American Financial (FAF) - First American Financial, based in Santa Ana, CA, provides services for homebuyers, sellers, and real estate professionals, and was founded in January 2008 [12] - FAF holds a Zacks Rank of 3 (Hold) and has a VGM Score of B, with a Momentum Style Score of B and a 3.9% increase in share price over the past four weeks [13][14] - Recent earnings estimates for fiscal 2025 have been revised upward, with the Zacks Consensus Estimate increasing by $0.03 to $5.35 per share, alongside an average earnings surprise of 5.6% [13]