Piper Jaffray cuts estimates on title insurers

Analyst Robert Napoli said refinancing origination volume has "slowed significantly" as mortgage rates increase and the number of houses sold declines.

Nearly all banks require the borrower to have title insurance before issuing a home loan so that the bank is assured that the collateral--the house--is truly clear of any prior deed claims.

But the volume of mortgage refinancing has slowed considerably in the past few quarters as banks tighten lending standards and mortgage rates increase.

He cites an increase in the average 30-year mortgage rate to 6.45 percent from its low of 5.48 percent in late January for curbing the rate of refinancing.

During the housing boom, homeowners refinanced at record paces to take advantage of historically low interest rates. The rate of home sales also surged as prices rose sharply and speculators entered the market.

Napoli lowered his earnings targets on Fidelity National Financial and First American Corp. He expects First American to earn $1.40 per share in the current year, down from a previous target of $1.70 per share. He cut his estimate for Fidelity National to 50 cents per share from 90 cents per share.

He rates both stocks "neutral."

Fidelity National shares fell 54 cents, or 4 percent, to $12.86 in afternoon trading. The stock has ranged from $12.60 to $24.22 in the past year.

First American shares lost 80 cents, or 3 percent, to $26.76. That stock has traded between $27.53 and $53.57 in the past 12 months.