Stewart: 3 Key Takeaways for Long-Term Investors

On its third-quarter 2026 earnings call, held on Oct. 22, 2026, Stewart (NYSE:STC) delivered adjusted earnings per share, a measure of net income per share, of $1.33. High mortgage rates slowed core residential transaction volume across the title insurance industry. Long-term investors care because management's focus on commercial title expansion and operational technology determines how well the business preserves profitability through cyclical housing downturns.

Three things management said stand out.

1. Real Estate Solutions Targets Margin Recovery as Order Volatility Settles

The Real Estate Solutions segment, which provides credit data, property appraisal, and default services to mortgage lenders, faced temporary margin compression as elevated mortgage rates drove up application cancellations. Management expects margins to recover from 10.4% back to 13% or 14% once mortgage application volumes stabilize.

I am pleased that we are able to maintain our double digit margins in these conditions and believe we will get to low to mid teens margin delivery through the execution of our strategic priorities... over the next 2 to 3 quarters.
-- Frederick Henry Eppinger Jr., Chief Executive Officer

2. Artificial Intelligence Tools Target Efficiency in Title Search Operations

Stewart is deploying artificial intelligence across 50 operational projects to streamline property title searches and policy underwriting. Management identifies automated title search as its primary operational lever to shorten turnaround times and reduce operating expenses during prolonged housing market slowdowns.

The search area is the place where there is the greatest opportunity for efficiency and accuracy and what I consider better turnaround time, for instance, for our agents. Which I think matters to the combined economics.
-- Frederick Henry Eppinger Jr., Chief Executive Officer

3. Agency Services Expansion Offsets High Mortgage Rate Headwinds

The Agency Services division, which issues title policies through independent partner agencies, expanded its footprint across 15 targeted states. Growing these partner relationships enabled Stewart to expand commercial policy premiums even as elevated 30-year mortgage rates constrained traditional home sales.

We continue to make good progress on these priorities with residential premiums up 7% and commercial premiums up 25% in the third quarter when compared to the same timeframe last year.
-- Frederick Henry Eppinger Jr., Chief Executive Officer

Looking Ahead

High 30-year mortgage rates near 7.5% weigh on residential sales, but Stewart is maintaining operational resources rather than shrinking back. Stewart relies on its commercial scale, technology tools, and $300 million in excess statutory reserve cash to expand market share during market weakness.

We will react to market changes by taking needed actions but we will be careful to retain the resources needed to serve our clients and react to opportunities I believe will come from this disruption.
-- Frederick Henry Eppinger Jr., Chief Executive Officer

Management expects strategic investments in commercial talent and data analytics to drive margin expansion over a multi-year timeline.

We remain focused on being a resilient company that has a growing portfolio of operations that will deliver share growth and improving margin performance. Over the next 2 to 3 years.
-- Frederick Henry Eppinger Jr., Chief Executive Officer

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