8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): October 26, 2006

STEWART INFORMATION SERVICES CORPORATION

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

DELAWARE	001-02658	74-1677330
(STATE OR OTHER JURISDICTION)	(COMMISSION FILE NO.)	(I.R.S. EMPLOYER IDENTIFICATION NO.)

1980 Post Oak Blvd, Houston, Texas	77056
(Address Of Principal Executive Offices)	(Zip Code)

Registrant’s Telephone Number, Including Area Code: (713) 625-8100

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CRF 240.14a-12)

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13a-4))

ITEM 2.02.   RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

          A press release issued by Stewart Information Services Corporation on October 26, 2006 regarding financial results for the three and nine months ended September 30, 2006 is attached hereto as Exhibit 99.1, and the first six paragraphs thereof are incorporated herein by reference.  This information is not deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 and is not incorporated by reference into any Securities Act registration statements.

ITEM 9.01.  FINANCIAL STATEMENTS AND EXHIBITS.

          (d) EXHIBITS

Exhibit No.	Description
99.1	Press release of Stewart Information Services Corporation dated October 26, 2006, reporting financial results for the three and nine months ended September 30, 2006.

SIGNATURE

           Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

STEWART INFORMATION SERVICES CORPORATION
(Registrant)
By:	/s/  Max Crisp
	(Max Crisp, Executive Vice President, Secretary-Treasurer, Director and Principal Financial and Accounting Officer)

Date:  October 26,  2006

EX-99.1

Exhibit 99.1

Stewart Reports Earnings for Third Quarter 2006

          HOUSTON, Oct. 26 /PRNewswire-FirstCall/ -- Stewart Information Services Corporation (NYSE: STC) today reported the results of its operations for the third quarter and nine months ended September 30, 2006. (Dollar amounts in the table below are in millions, except per share figures.)

	Third Quarter
	2006		2005
Total revenues	$	641.5	$	639.4
Pretax earnings before minority interests		27.0		57.2
Net earnings		14.2		31.8
Net earnings per diluted share		0.77		1.74

	Nine Months
	2006		2005
Total revenues	$	1,825.7	$	1,801.5
Pretax earnings before minority interests		64.9		143.7
Net earnings		32.5		79.7
Net earnings per diluted share		1.78		4.37

          Financial Highlights

*	Revenues increased 0.3 percent to $641.5 million in the third quarter of 2006 compared with $639.4 million for the third quarter of 2005. Pretax earnings (calculated before minority interests) for the third quarter of 2006 were $27.0 million compared with $57.2 million for the same period of 2005.
*	Revenues increased 1.3 percent to $1.83 billion in the first nine months of 2006 compared with $1.80 billion for the first nine months of 2005. Pretax earnings (calculated before minority interests) for the first nine months of 2006 were $64.9 million compared with $143.7 million for the same period of 2005.
*	The increase in revenue in the third quarter of 2006 from the same period in 2005 was due primarily to revenues from new agencies, the impact of acquisitions and strong growth in commercial transactions, offset by a decline in revenues and transactions handled by our direct operations.  The decrease in revenues from direct operations resulted from a reduction in residential closings due to a higher interest rate environment that has significantly impacted certain major markets of the country.  Mortgage interest rates averaged 6.6 percent in the third quarter of 2006 compared with 5.8 percent in the third quarter of 2005. Acquisitions increased revenues by $12.1 million for the quarter.
*	Profits for the third quarter of 2006 versus 2005 were reduced primarily due to a higher complement of lower-margin agency business compared to direct operations and higher other operating costs.  Other operating costs increased primarily due to expenses associated with new offices, increased technology development for higher productivity and security costs to comply with both privacy laws and Sarbanes-Oxley. The Company is continually monitoring changes in transaction volumes and has now reduced staff levels accordingly while continuing with its goal to provide superior customer service and gain market share. Excluding the effect of increases from new locations, the Company’s workforce was reduced by approximately 650 employees, or 6.4 percent, since September 30, 2005.  A significant number of these staff reductions occurred during the third quarter and, as such, the corresponding reduction in employee costs will be realized in the fourth quarter of 2006.
*	Stewart’s book value per share increased to $44.11 at September 30, 2006 compared with $42.21 at December 31, 2005.
*	Title orders from direct operations declined in the third quarter of 2006 by 23.2 percent from the same period a year ago. September orders were 25.0 percent lower than the same month a year ago. The increase in mortgage interest rates and a reduction in home sales were the major reasons for the decline in title orders.

          “Within our REI portal group, PropertyInfo.com, we changed leadership and consolidated our web-based title services for agencies to provide a one-stop order and delivery point for our agency network,” said Stewart Morris, Jr., president and co-chief executive officer. “We also have consolidated and rebranded the lender services division of Stewart Mortgage Information, which is now known as Stewart Lender Services.  Products and services, spanning from loan origination to post-closing services, are available at http://www.stewartlenderservices.com .

           “Homebuyers have evolved rapidly from print-based media to online searching,” added Stewart Morris, Jr. “Our SureClose® transaction management platform, patent-pending eClosingRoom™, e-signature, e-notarization, e- recording and e-vault technologies position Stewart to continue to exceed consumer expectations for lower costs and more efficient closings.  Our investment in technology has resulted in a key marketing and productivity tool.  We are moving our primary title production and transaction management systems to an integrated web-based platform.”

          “Our rapidly growing commercial title business is a bright spot on the financial side,” said Malcolm S. Morris, chairman and co-chief executive officer.  “We have tripled our commercial business since 2000.  Commercial customers are serviced by Stewart’s National Title Services (NTS), which has 20 offices across the country plus more than 900 Stewart Title offices and branches.  In addition, the 2004 acquisition of Title Associates in New York has also contributed greatly to this growth. Our commercial closers, underwriters, marketing specialists and escrow officers deliver stellar service.  Stewart Title Guaranty Company’s balance sheet, with an industry- record 31 years of growth in surplus and reserves, provides the confidence level that commercial policyholders demand.

          “The current growing commercial real estate market is benefiting not only our title business but also our subsidiary, Asset Preservation, Inc., which is a national leader in tax-deferred exchanges under Section 1031 of the Internal Revenue Code.” 

          Stewart Information Services Corporation is a customer-oriented, technology-driven, strategically competitive, real estate information and transaction management company. Stewart provides title insurance and related information services required for settlement by the real estate and mortgage industries through more than 9,500 policy-issuing offices and agencies in the United States and international markets. Stewart also provides post-closing lender services, mortgage default management solutions, automated county clerk land records, property ownership mapping, geographic information systems, property information reports, flood certificates, document preparation, background checks and expertise in tax-deferred exchanges. More information can be found at http://www.stewart.com . 

          This press release may contain forward-looking statements, which include all statements other than statements of historical facts. Forward-looking statements are not guarantees of performance and no assurance can be given that Stewart’s expectations will be achieved. In particular, historical order counts do not necessarily indicate future revenues because Stewart cannot predict the number of orders that will result in closings.

STEWART INFORMATION SERVICES CORPORATION
STATEMENTS OF EARNINGS
(In thousands of dollars, except per share amounts)

	Three months ended September 30					Nine months ended September 30
	2006		2005			2006		2005
Revenues
Title insurance:
Direct operations		262,610		287,607			766,041		779,422
Agency operations		348,842		320,545			970,685		935,730
Real estate information services		20,161		22,760			59,915		61,075
Investment income		8,750		8,016			25,683		21,473
Investment and other gains - net		1,158		514			3,349		3,783
		641,521		639,442			1,825,673		1,801,483
Expenses
Amounts retained by agencies		282,592		259,557			784,403		762,781
Employee costs		183,447		183,863			546,218		513,353
Other operating expenses		101,758		97,963			299,003		270,927
Title losses and related claims		35,374		31,434			99,849		83,778
Depreciation and amortization		9,791		8,592			26,905		24,642
Interest		1,577		883			4,424		2,278
		614,539		582,292			1,760,802		1,657,759
Earnings before taxes and minority interests		26,982		57,150			64,871		143,724
Income taxes		7,942		19,880			18,431		50,041
Minority interests		4,890		5,499			13,933		14,019
Net earnings		14,150		31,771			32,507		79,664
Average number of diluted shares (000)		18,297		18,259			18,302		18,236
Earnings per share -diluted		0.77		1.74			1.78		4.37
Segment information:
Title revenues		621,360		616,682			1,765,758		1,740,408
Title pretax earnings before minority interests		26,973		51,748			63,382		133,833
REI revenues		20,161		22,760			59,915		61,075
REI pretax earnings before minority interests		9		5,402			1,489		9,891
Selected financial information:
Cash provided by operations		42,333		45,903			55,122		133,272
Title loss payments - net of recoveries		24,694		26,336			79,850		59,777
Changes in other comprehensive earnings - net of taxes		7,455		(4,099	)		2,115		(5,244	)
Number of title orders opened (000):
July		59		77
August		68		86
September		56		75
Quarter		183		238

	September 30 2006		December 31 2005
Stockholders’ equity		803,783		766,313
Number of shares outstanding (000)		18,223		18,154
Book value per share		44.11		42.21

STEWART INFORMATION SERVICES CORPORATION
BALANCE SHEETS (condensed)
(In thousands of dollars)

	September 30 2006			December 31 2005
Assets
Cash and cash equivalents		127,582			134,734
Short-term investments		168,628			206,717
Investments - statutory reserve funds		476,609			449,475
Investments - other		89,283			85,802
Receivables - premiums from agencies		47,800			49,397
Receivables - other		48,136			47,791
Allowance for uncollectible amounts		(8,952	)		(8,526	)
Property and equipment		91,286			85,762
Title plants		68,777			58,930
Goodwill		188,435			155,624
Intangible assets		14,593			15,268
Other assets		94,356			80,177
		1,406,533			1,361,151
Liabilities
Notes payable		94,626			88,413
Accounts payable and accrued liabilities		109,848			125,255
Estimated title losses		369,427			346,704
Deferred income taxes		11,196			15,784
Minority interests		17,653			18,682
		602,750			594,838
Contingent liabilities and commitments
Stockholders’ equity
Common and Class B Common Stock and additional paid-in capital		148,215			145,367
Retained earnings		651,739			619,232
Accumulated other comprehensive earnings		7,743			5,628
Treasury stock		(3,914	)		(3,914	)
Total stockholders’ equity		803,783			766,313
		1,406,533			1,361,151

          October 26, 2006

SOURCE  Stewart Information Services Corporation
          -0-                                                                      10/26/2006
          /CONTACT:  Ted C. Jones, Director - Investor Relations of Stewart Information Services Corporation, +1-713-625-8014/
          /Web site:  http://www.stewart.com
                            http://www.stewartlenderservices.com /