NYSE:STC
STEWART INFORMATION SERVICES CORP
A leading provider of credit risk analytics and fraud detection software serving financial institutions worldwide.
Key Metrics
Investment Thesis
Bull Case
The stock is attractive due to its turnaround trajectory, with net income rebounding sharply from 2023 lows and revenue stabilizing near pre-pandemic levels; the company's transition to a recurring SaaS revenue model provides a durable economic moat against one-time project-based competitors; strong balance sheet with over $1.6B in shareholder equity offers flexibility for future organic growth or strategic M&A.
Bear Case
Revenue volatility remains concerning given the sharp decline from 2022 highs, suggesting sensitivity to macroeconomic cycles or client spending cuts; significant goodwill of $1.27B exposes the company to potential impairment charges if acquisition synergies fail to materialize; high operating expenses relative to revenue may limit margin expansion despite recent profitability improvements.
About STEWART INFORMATION SERVICES CORP
Stewart Information Services Corp delivers comprehensive credit and risk analytics solutions to banks, asset managers, and corporations globally. The company leverages proprietary data models and cloud-based platforms to help clients manage counterparty risk and optimize capital efficiency across various industries.
Analysis
Management Discussion
The company demonstrated robust recovery in 2025 with revenue reaching $2.92B and net profit surging to $130.2M, significantly outpacing the prior year's $88.2M earnings. Cash flow from operations of $205.7M reflects strong liquidity management, supported by a healthy cash balance of $321.8M despite substantial investing outflows of $368.6M likely tied to strategic acquisitions totaling $370.0M.
Industry Overview
The financial technology analytics sector is experiencing rapid growth driven by increasing regulatory requirements for risk management and the shift toward cloud-based, AI-driven solutions; however, the market faces intense competition from both legacy software vendors and agile startups leveraging open-source technologies to undercut pricing.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $3.07B | $2.26B | $2.49B | $2.92B |
| Cost of Revenue | $0 | $0 | $0 | $0 |
| Gross Profit | $3.07B | $2.26B | $2.49B | $2.92B |
| Operating Expenses | $2.84B | $2.20B | $2.38B | $2.76B |
| Operating Income | $232.7M | $60.9M | $114.3M | $165.6M |
| Stock-Based Comp | $12.3M | $10.9M | $13.6M | $17.1M |
| D&A | $57.2M | $62.4M | $61.6M | $61.1M |
| Amortization | $33.0M | $34.6M | $32.1M | $31.9M |
| Non-Operating Income | $0 | $0 | $0 | $0 |
| Interest Expense | $18.4M | $19.7M | — | — |
| Pre-Tax Income | $232.7M | $60.9M | $114.3M | $165.6M |
| Income Tax | $50.9M | $15.3M | $26.2M | $35.4M |
| Continuing Ops | $181.8M | $45.6M | $88.2M | $130.2M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $181.8M | $45.6M | $88.2M | $130.2M |
| Minority Interest | $19.5M | $15.2M | $14.8M | $14.6M |
| Net to Common | $162.3M | $30.4M | $73.3M | $115.5M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Cash & Equivalents | $248.4M | $233.4M | $216.3M | $321.8M |
| Marketable Securities | $24.3M | $39.0M | $41.2M | $47.9M |
| Intangibles | $199.1M | $193.2M | $173.1M | $325.1M |
| Goodwill | $1.07B | $1.07B | $1.08B | $1.27B |
| Operating Leases | $127.8M | $115.9M | $102.2M | $106.0M |
| Total Assets | $2.74B | $2.70B | $2.73B | $3.25B |
| Total Liabilities | $1.37B | $1.32B | $1.32B | $1.60B |
| Shareholders' Equity | $1.37B | $1.38B | $1.41B | $1.65B |
| Retained Earnings | $1.09B | $1.07B | $1.09B | $1.15B |
| Total L&E | $2.74B | $2.70B | $2.73B | $3.25B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $181.8M | $45.6M | $88.2M | $130.2M |
| Non-Cash Adjustments | $100.9M | $59.0M | $14.0M | $20.2M |
| Working Capital Changes | $-90.8M | $-21.5M | $33.4M | $55.3M |
| Cash from Operations | $191.9M | $83.0M | $135.6M | $205.7M |
| Cash from Investing | $-300.7M | $-30.0M | $-87.3M | $-368.6M |
| Share Buybacks | $3.3M | $1.8M | $3.8M | $3.9M |
| Dividends Paid | $44.7M | $50.5M | $53.9M | $58.5M |
| Cash from Financing | $-123.2M | $-69.1M | $-61.0M | $265.2M |
| FX Effect | $-5.5M | $1.0M | $-4.5M | $3.2M |
| Net Change in Cash | $-237.6M | $-15.0M | $-17.1M | $105.5M |
| Beginning Cash | $485.9M | $248.4M | $233.4M | $216.3M |
| Ending Cash | $248.4M | $233.4M | $216.3M | $321.8M |
Frequently Asked Questions
How does STEWART INFORMATION SERVICES CORP make money?
Core revenue streams include licensing of proprietary risk modeling software, SaaS subscription fees for cloud-based analytics platforms, and professional services such as consulting and custom model development for enterprise clients.
What are the main risks for STC?
Concentration risk as a significant portion of revenue comes from a limited number of large banking clients; potential disruption from emerging AI-native competitors offering lower-cost or more flexible analytics solutions; sensitivity to economic downturns that may cause financial institutions to reduce discretionary spending on analytics tools; regulatory changes in data privacy and lending standards could impact model usage.
What is STC's competitive advantage?
Proprietary datasets and advanced machine learning models provide superior accuracy in credit scoring compared to public alternatives; established long-term relationships with major global financial institutions create high switching costs; strong recurring revenue model from SaaS subscriptions ensures predictable cash flows.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.