Company Overview - Essent Group (ESNT) is based in Hamilton and operates in the Finance sector, with a year-to-date share price change of 9.39% [3] - The company currently pays a dividend of $0.31 per share, resulting in a dividend yield of 2.08%, which is significantly higher than the Insurance - Property and Casualty industry's yield of 0.58% and the S&P 500's yield of 1.53% [3] Dividend Performance - Essent Group's current annualized dividend of $1.24 represents a 10.7% increase from the previous year [4] - Over the past five years, the company has increased its dividend five times, achieving an average annual increase of 16.21% [4] - The current payout ratio is 18%, indicating that the company paid out 18% of its trailing 12-month earnings per share as dividends [4] Earnings Growth Expectations - For the fiscal year, Essent Group anticipates solid earnings growth, with the Zacks Consensus Estimate for 2025 projected at $6.87 per share, reflecting a year-over-year earnings growth rate of 0.29% [5] Investment Considerations - The company is viewed as a compelling investment opportunity due to its attractive dividend and strong Zacks Rank of 2 (Buy) [6] - Income investors are particularly interested in dividends as they enhance stock investing profits and reduce overall portfolio risk [5]

Core Viewpoint - The article compares Essent Group (ESNT) and Cincinnati Financial (CINF) to determine which stock is more attractive to value investors [1] Valuation Metrics - Both ESNT and CINF currently have a Zacks Rank of 2 (Buy), indicating a positive earnings outlook due to favorable analyst estimate revisions [3] - Value investors utilize various valuation metrics, including P/E ratio, P/S ratio, earnings yield, and cash flow per share to assess undervaluation [4] Specific Valuation Comparisons - ESNT has a forward P/E ratio of 8.66, while CINF has a significantly higher forward P/E of 27.65 [5] - The PEG ratio for ESNT is 3.44, compared to CINF's PEG ratio of 9.70, indicating ESNT may be more attractive based on expected earnings growth [5] - ESNT's P/B ratio stands at 1.09, while CINF's P/B ratio is 1.66, suggesting ESNT is more favorably valued in terms of market value versus book value [6] Overall Assessment - Based on the valuation metrics analyzed, ESNT is considered the superior value option compared to CINF [7]

Company Overview - Essent Group (ESNT) is a mortgage insurance and reinsurance holding company based in Hamilton, operating in the Finance sector [3] - The company's shares have experienced a price change of 7% so far this year [3] Dividend Information - Essent Group currently pays a dividend of $0.31 per share, resulting in a dividend yield of 2.13%, which is significantly higher than the Insurance - Property and Casualty industry's yield of 0.55% and the S&P 500's yield of 1.56% [3] - The annualized dividend of $1.24 represents a 10.7% increase from the previous year [4] - Over the last 5 years, Essent Group has increased its dividend 4 times on a year-over-year basis, achieving an average annual increase of 16.16% [4] - The current payout ratio is 18%, indicating that the company paid out 18% of its trailing 12-month earnings per share as dividends [4] Earnings Growth Expectations - For the fiscal year, Essent Group anticipates solid earnings growth, with the Zacks Consensus Estimate for 2025 projected at $6.87 per share, reflecting a 0.29% increase from the previous year [5] Investment Appeal - Essent Group is viewed as an attractive dividend play and a compelling investment opportunity, currently holding a Zacks Rank of 2 (Buy) [7]

Financial Performance - Net premiums earned for the three months ended March 31, 2025, were $245,848 thousand, slightly up from $245,590 thousand in the same period of 2024, indicating a growth of 0.1%[19] - Total revenues rose to $317,558 thousand for Q1 2025, compared to $298,357 thousand in Q1 2024, marking an increase of 6.4%[19] - Net income for Q1 2025 was $175,433 thousand, down from $181,719 thousand in Q1 2024, representing a decrease of 3.5%[19] - The company reported a comprehensive income of $247,171 thousand for Q1 2025, compared to $159,953 thousand in Q1 2024, reflecting a significant increase of 54.4%[19] - Total revenues for the three months ended March 31, 2025, were $317.56 million, compared to $298.36 million for the same period in 2024, representing an increase of approximately 6.4%[182] - Net premiums earned remained largely unchanged at $245.85 million for the three months ended March 31, 2025, compared to $245.59 million for the same period in 2024[183] - Basic earnings per share (EPS) for Q1 2025 was $1.71, slightly down from $1.72 in Q1 2024[97] - Diluted EPS for Q1 2025 was $1.69, compared to $1.70 in the same period last year[97] Assets and Equity - Total assets increased to $7,204,711 thousand as of March 31, 2025, compared to $7,111,649 thousand at December 31, 2024, reflecting a growth of 1.3%[17] - Total stockholders' equity rose to $5,659,306 thousand as of March 31, 2025, compared to $5,603,658 thousand at December 31, 2024, reflecting an increase of 1.0%[17] - Cash at the end of the period increased to $208,066 thousand from $164,255 thousand at the end of Q1 2024, a rise of 26.6%[23] - As of March 31, 2025, total investments available for sale amounted to $5,882.359 million, with an amortized cost of $6,153.624 million, reflecting unrealized losses of $282.386 million[40] - Total assets at fair value as of March 31, 2025, amounted to $5,882,359 thousand, compared to $5,876,721 thousand at the end of 2024[109] Investment Performance - The net investment income for the three months ended March 31, 2025, was $58.2 million, compared to $52.1 million for the same period in 2024, reflecting an increase of approximately 11.5%[51] - The gross investment income for the three months ended March 31, 2025, was $60.0 million, compared to $53.4 million in 2024, marking an increase of approximately 12.3%[51] - Income from other invested assets turned to a profit of $7.4 million in Q1 2025 compared to a loss of $1.9 million in Q1 2024[185] - The company maintains a diversified investment portfolio, with corporate debt securities making up 41.7% of total corporate debt as of March 31, 2025[40] Loss Reserves and Claims - The reserve for losses and LAE increased to $356,653 thousand as of March 31, 2025, compared to $328,866 thousand at December 31, 2024, an increase of 8.4%[17] - The provision for losses and loss adjustment expenses (LAE) increased to $31.29 million for the three months ended March 31, 2025, from $9.91 million in the same period of 2024[182] - The total reserves for losses and LAE at the end of Q1 2025 were $338.1 million, compared to $253.6 million at the end of Q1 2024, reflecting a 33.4% increase[197] - The number of claims paid increased to 153 in Q1 2025, with total claims paid amounting to $6.33 million, up from 123 claims and $3.61 million in Q1 2024[201] Dividends and Share Buybacks - The company declared dividends totaling $31,869 thousand in Q1 2025, compared to $29,906 thousand in Q1 2024, an increase of 6.5%[21] - The company acquired treasury stock amounting to $168,850 thousand in Q1 2025, compared to $13,552 thousand in Q1 2024, indicating a significant increase in share buybacks[23] - Essent Re paid dividends of $100 million and $37.5 million to its parent in the three months ended March 31, 2025 and 2024, respectively, with total equity of $1.8 billion as of March 31, 2025[94] Business Segments and Operations - The company has one reportable business segment, which is Mortgage Insurance, and it operates primarily through its subsidiary Essent Guaranty[32] - The mortgage insurance segment provides private mortgage insurance and reinsurance for U.S. residential properties, with a focus on credit risk management solutions[32] - Total revenues for the Mortgage Insurance segment were $288.9 million for the three months ended March 31, 2025, compared to $274.7 million for the same period in 2024, reflecting an increase of approximately 5.2%[131] - The loss ratio for the Mortgage Insurance segment was 13.1% for the three months ended March 31, 2025, compared to 4.1% for the same period in 2024, indicating a significant increase in losses relative to premiums earned[131] Regulatory and Economic Environment - The company is currently evaluating the impact of recently issued accounting standards on its consolidated financial statements, including ASU 2023-09 and ASU 2024-03[37][38] - The Federal Reserve reduced the target federal funds rate by 100 basis points since September 2024, impacting mortgage interest rates and potentially affecting the company's loss estimates[70] - The corporate income tax enacted in Bermuda will result in a new 15% corporate income tax starting January 1, 2025, but the company expects to qualify for a five-year exemption[144][145] - The company anticipates that legislative and regulatory developments will significantly impact its results and future success in the housing finance industry[142] Future Outlook - The company expects incurred losses and claims to increase as a greater amount of its insurance portfolio reaches the anticipated period of highest claim frequency[159] - The company expects the ultimate number of hurricane-related defaults to be less than non-hurricane-related defaults, with reserves for these defaults remaining materially unchanged as of March 31, 2025[68] - The company anticipates that as it continues to add new customers, its expenses will also continue to increase in line with the level of mortgage insurance and title insurance policies issued[170]

Financial Data and Key Metrics Changes - For Q1 2025, the company reported net income of $175 million, a decrease from $182 million a year ago [6] - Diluted earnings per share were $1.69, compared to $1.70 in the same quarter last year [6] - The annualized return on average equity was 12% for the quarter [6] - Consolidated cash and investments as of March 31 were $6.4 billion, with a new money yield over 5% [9] - The annualized investment yield for Q1 was 3.8% [10] Business Line Data and Key Metrics Changes - The U.S. mortgage insurance in force was $245 billion, a 3% increase year-over-year [9] - The mortgage insurance net premium earned for Q1 was $234 million, including $15.5 million from Essent Re [14] - The average base premium rate for the U.S. mortgage insurance portfolio was 41 basis points, consistent with the previous quarter [15] - The default rate on the U.S. mortgage insurance portfolio was 2.19%, down from 2.27% at the end of Q4 2024 [16] Market Data and Key Metrics Changes - The company noted challenges for lenders due to lower originations from higher rates and affordability issues [6][7] - The persistency rate for the mortgage insurance portfolio was 86%, flat from the previous quarter [9] Company Strategy and Development Direction - The company aims to balance a conservative balance sheet while preserving optionality for strategic growth opportunities and optimizing shareholder returns [10] - The management believes that favorable demographic trends and current affordability issues are creating pent-up demand for housing [5] - The company is focused on maintaining strong unit economics and is valuation sensitive regarding share buybacks [11][59] Management's Comments on Operating Environment and Future Outlook - Management expressed a constructive long-term outlook for housing, despite near-term headwinds to consumer spending and economic growth [5] - The management highlighted the importance of income growth to unlock housing supply and indicated that the average age of first-time homeowners is 38, suggesting pent-up demand [29] - The company is well-positioned to navigate the current environment due to the strength of its operating model [21] Other Important Information - The Board approved a common dividend of $0.31 for Q2 2025 [10] - The company repurchased nearly 4 million shares for over $200 million year-to-date through April 30 [11] - The PMIERs sufficiency ratio was strong at 172% with $1.5 billion in excess available assets [18] Q&A Session Summary Question: Affordability cycle for homeownership - Management noted uncertainty in the affordability cycle but indicated that the quality of borrowers remains strong due to current conditions [25][26] Question: Managing risk amid macro uncertainty - Management stated that pricing adjustments are made based on micro factors and that they are in a wait-and-see mode regarding macroeconomic impacts [37][39] Question: Buybacks in Q1 versus April - The company repurchased 2.8 million shares for $157 million in Q1 and 1.1 million shares for $61 million in April [46] Question: Changes in unit economics over the last few years - Management indicated that unit economics have remained strong, with pricing increases observed in 2022 [55][56] Question: Update on the title business - Management expressed confidence in the title business, noting it is positioned for growth when interest rates decline [66][68] Question: Dividend flows from underwriting companies - Management indicated that they will continue to maximize dividends from both entities, subject to credit conditions [75][79]

Financial Data and Key Metrics Changes - For Q1 2025, the company reported net income of $175 million, a decrease from $182 million a year ago, with diluted earnings per share of $1.69 compared to $1.70 a year ago [5][11] - The annualized return on average equity was 12% for the quarter [5] - Consolidated cash and investments as of March 31 were $6.4 billion, with a new money yield over 5% [7][8] - The annualized investment yield for Q1 was 3.8% [8] Business Line Data and Key Metrics Changes - The U.S. mortgage insurance in force was $245 billion, a 3% increase year-over-year [7] - The mortgage insurance net premium earned for Q1 was $234 million, including $15.5 million from Essent Re [13] - The average base premium rate for the U.S. mortgage insurance portfolio was 41 basis points, consistent with the previous quarter [14] - The default rate on the U.S. mortgage insurance portfolio was 2.19%, down from 2.27% at the end of Q4 2024 [15] Market Data and Key Metrics Changes - The twelve-month persistency rate as of March 31 was 86%, unchanged from the previous quarter [7] - The weighted average FICO score of the insurance in force was 746, with a weighted average original LTV of 93% [7] Company Strategy and Development Direction - The company aims to balance a conservative balance sheet while preserving optionality for strategic growth opportunities and optimizing shareholder returns [8] - The management believes that favorable demographic trends and current affordability issues are creating pent-up demand for housing [4] - The company is focused on maintaining strong unit economics and is valuation sensitive regarding share buybacks [10][56] Management's Comments on Operating Environment and Future Outlook - Management expressed a constructive long-term outlook for housing, despite anticipating near-term headwinds to consumer spending and economic growth [4] - The company is well-positioned to navigate the current environment due to the strength of its operating model and high credit quality of its insured portfolio [4][20] - Management noted that the average age of first-time homeowners is 38, indicating significant pent-up demand for housing [27] Other Important Information - The Board approved a common dividend of $0.31 for Q2 2025 [9] - The company repurchased nearly 4 million shares for over $200 million year-to-date through April 30 [10][19] - The PMIER sufficiency ratio was strong at 172% with $1.5 billion in excess available assets [17] Q&A Session Summary Question: Thoughts on affordability cycle for homeownership - Management noted uncertainty in the affordability cycle but highlighted that the quality of borrowers remains strong due to current economic conditions [23][24] Question: Managing risk amid macro uncertainty - Management indicated that pricing adjustments have been made in certain markets, but a wait-and-see approach is being taken regarding macroeconomic impacts [35][36] Question: Credit loss expectations - Management confirmed that the default rate is expected to remain within the 2% to 3% range, with current rates at the lower end of that spectrum [38] Question: Buyback details - The company repurchased 2.8 million shares for $157 million in Q1 and an additional 1.1 million shares for $61 million in April [43][44] Question: Dividend flows from underwriting companies - Management stated that dividends will continue from both entities, subject to credit conditions remaining stable [72][74]

分组1 - Essent Group reported quarterly earnings of $1.69 per share, exceeding the Zacks Consensus Estimate of $1.66 per share, but down from $1.70 per share a year ago, representing an earnings surprise of 1.81% [1] - The company posted revenues of $317.56 million for the quarter, surpassing the Zacks Consensus Estimate by 2.03%, and up from $298.36 million year-over-year [2] - Essent Group has outperformed the S&P 500, with shares increasing about 7.9% since the beginning of the year, while the S&P 500 declined by 3.7% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $1.70 on revenues of $314.81 million, and for the current fiscal year, it is $6.85 on revenues of $1.27 billion [7] - The Zacks Industry Rank for Insurance - Property and Casualty is in the top 17% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

Financial Performance - Net income for 1Q25 was $1754 million, compared to $1679 million in 4Q24[5] - Annualized ROE increased to 125% in 1Q25 from 119% in 4Q24[5] - Shareholders' equity reached $57 billion in 1Q25, up from $56 billion in 4Q24[5] - The combined ratio improved to 318% in 1Q25 from 338% in 4Q24[5] - Book value per share grew to $5522 in Mar-25, with an annualized growth rate of 183% since December 31, 2013[11] Portfolio and Risk Management - U S Mortgage Insurance In Force (IIF) increased to $2447 billion in 1Q25 from $2436 billion in 4Q24[5] - New Insurance Written (NIW) was $99 billion in 1Q25, compared to $122 billion in 4Q24[5] - The portfolio default rate decreased to 219% in 1Q25 from 227% in 4Q24[6] - 97% of IIF is subject to reinsurance protection as of March 31, 2025[6,33,36] - Risk-to-capital ratio improved to 96:1 in 1Q25 from 98:1 in 4Q24[6] Capital Distribution - The company repurchased 39 million common shares for $218 million year-to-date through April 30th[9] - A quarterly dividend of $031 per common share was approved for 2Q25[9]

[Financial Performance Overview](index=1&type=section&id=Financial%20Performance%20Overview) This section details Essent Group's Q1 2025 financial results, capital return initiatives, and key business and operational achievements [First Quarter 2025 Results](index=1&type=section&id=First%20Quarter%202025%20Results) Essent Group reported a net income of $175.4 million for Q1 2025, a slight decrease from $181.7 million in Q1 2024. Diluted earnings per share also saw a minor dip to $1.69 from $1.70 year-over-year. The company's performance was supported by favorable credit performance, high portfolio persistency, and a 12% YoY increase in net investment income Q1 2025 Key Financial Metrics | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Income | $175.4 million | $181.7 million | | Diluted EPS | $1.69 | $1.70 | - The Chairman and CEO, Mark A. Casale, attributed the strong results to favorable credit performance, elevated portfolio persistency, and higher investment income[3](index=3&type=chunk) - Net investment income for Q1 2025 was **$58.2 million**, representing a **12% increase** from Q1 2024[10](index=10&type=chunk) [Capital Returns](index=1&type=section&id=Capital%20Returns) The Board of Directors declared a quarterly cash dividend of $0.31 per common share. Additionally, through April 30, 2025, the company has repurchased 3.9 million common shares for approximately $218 million, with $429 million remaining under the current repurchase authorization - A quarterly cash dividend of **$0.31 per common share** was declared, payable on June 10, 2025, to shareholders of record on May 30, 2025[2](index=2&type=chunk) - Year-to-date through April 30, 2025, Essent repurchased **3.9 million shares** for about **$218 million**. There is **$429 million remaining** under the $500 million repurchase plan authorized in February 2025[10](index=10&type=chunk) [Business and Operational Highlights](index=1&type=section&id=Business%20and%20Operational%20Highlights) In Q1 2025, Essent's new insurance written (NIW) was $9.9 billion, an increase from $8.3 billion in Q1 2024 but a decrease from $12.2 billion in Q4 2024. Insurance in force (IIF) grew to $244.7 billion. The company also executed several reinsurance transactions to manage risk, including two forward quota share agreements and two excess of loss transactions Key Operational Metrics | Metric | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | New Insurance Written | $9.9 billion | $12.2 billion | $8.3 billion | | Insurance in Force | $244.7 billion | $243.6 billion | $238.5 billion | - During Q1 2025, Essent entered into two forward quota share transactions covering **25% of the risk** for eligible policies written in 2025 and 2026[10](index=10&type=chunk) - In April, the company entered into two excess of loss transactions covering **20% of eligible policies** written in 2025 and 2026[10](index=10&type=chunk) [Consolidated Financial Statements](index=4&type=section&id=Consolidated%20Financial%20Statements) This section presents Essent Group's Q1 2025 condensed consolidated statements of comprehensive income and balance sheets, highlighting revenue, expenses, net income, assets, and equity [Condensed Consolidated Statements of Comprehensive Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) For Q1 2025, total revenues increased to $317.6 million from $298.4 million in Q1 2024, driven by higher net investment income. However, a significant rise in the provision for losses and LAE (from $9.9 million to $31.3 million) and increased operating expenses led to a decrease in net income to $175.4 million compared to $181.7 million in the prior-year quarter Q1 2025 Income Statement Highlights (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Premiums Earned | $245,848 | $245,590 | | Net Investment Income | $58,210 | $52,085 | | **Total Revenues** | **$317,558** | **$298,357** | | Provision for Losses and LAE | $31,287 | $9,913 | | Other Underwriting & Operating Expenses | $71,124 | $66,840 | | **Total Losses and Expenses** | **$110,559** | **$84,615** | | Income Before Income Taxes | $206,999 | $213,742 | | **Net Income** | **$175,433** | **$181,719** | | **Diluted EPS** | **$1.69** | **$1.70** | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, Essent's total assets grew to $7.20 billion from $7.11 billion at year-end 2024. Total liabilities also increased to $1.55 billion. Total stockholders' equity rose to $5.66 billion, resulting in a book value per share of $55.22, up from $53.36 at the end of 2024 Balance Sheet Highlights (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Investments | $6,204,217 | $6,180,621 | | **Total Assets** | **$7,204,711** | **$7,111,649** | | Reserve for Losses and LAE | $356,653 | $328,866 | | **Total Liabilities** | **$1,545,405** | **$1,507,991** | | **Total Stockholders' Equity** | **$5,659,306** | **$5,603,658** | - Book value per share increased to **$55.22** as of March 31, 2025, compared to **$53.36** as of December 31, 2024[18](index=18&type=chunk) [Operational and Portfolio Analysis](index=7&type=section&id=Operational%20and%20Portfolio%20Analysis) This section provides an in-depth analysis of Essent's U.S. mortgage insurance portfolio, including new insurance written, in-force quality, and default and loss reserve trends [U.S. Mortgage Insurance Portfolio Overview](index=7&type=section&id=U.S.%20Mortgage%20Insurance%20Portfolio%20Overview) The U.S. Mortgage Insurance portfolio continued to expand, with insurance in force reaching $244.7 billion at the end of Q1 2025. The percentage of loans in default increased to 2.19% from 1.71% in Q1 2024, but decreased from 2.27% in Q4 2024. Annual persistency remained high and stable at 85.7% U.S. Mortgage Insurance Portfolio Metrics | Metric | March 31, 2025 | December 31, 2024 | March 31, 2024 | | :--- | :--- | :--- | :--- | | Insurance in force (end of period) | $244.7B | $243.6B | $238.5B | | Risk in force (end of period) | $56.6B | $56.5B | $54.7B | | Policies in force | 811,342 | 813,013 | 815,000 (approx) | | Percentage of loans in default | 2.19% | 2.27% | 1.71% | | Annual persistency | 85.7% | 85.7% | N/A | [New Insurance Written (NIW)](index=8&type=section&id=New%20Insurance%20Written%20%28NIW%29) In Q1 2025, New Insurance Written (NIW) totaled $9.9 billion. The portfolio composition shows a continued focus on high-quality credit, with a weighted average credit score of 751. Purchase mortgages dominated NIW at 94.3%, and monthly premium policies constituted 98.6% of the new business - Purchase mortgages represented **94.3% of NIW** in Q1 2025, up from 88.3% in Q4 2024 but down from 97.4% in Q1 2024[24](index=24&type=chunk) - The weighted average credit score for NIW in Q1 2025 was **751**, consistent with Q4 2024 and up from 747 in Q1 2024. Borrowers with credit scores of 740 or higher accounted for **65.1% of NIW**[25](index=25&type=chunk) - The weighted average Loan-to-Value (LTV) ratio for NIW remained stable at **93%**[25](index=25&type=chunk) [Insurance in Force (IIF) and Risk in Force (RIF) Portfolio Quality](index=9&type=section&id=Insurance%20in%20Force%20%28IIF%29%20and%20Risk%20in%20Force%20%28RIF%29%20Portfolio%20Quality) The credit quality of the in-force portfolio remained strong and stable as of March 31, 2025. The weighted average credit score was 746, and the weighted average LTV was 93%, both unchanged from the previous quarter and year-ago period. The majority of the portfolio (97.8%) consists of 30-year or higher fixed-rate mortgages - The weighted average credit score of the Insurance in Force (IIF) portfolio was **746**, consistent across Q1 2025, Q4 2024, and Q1 2024[27](index=27&type=chunk) - The weighted average LTV of the IIF portfolio was **93%**, also consistent across the same periods[27](index=27&type=chunk) - Fixed-rate mortgages with terms of 30 years or more constitute **97.8% of the IIF portfolio**[27](index=27&type=chunk) [Default and Loss Reserve Analysis](index=14&type=section&id=Default%20and%20Loss%20Reserve%20Analysis) The number of loans in default decreased to 17,759 in Q1 2025 from 18,439 in Q4 2024, driven by a higher number of cures than new defaults. The total reserve for losses and LAE increased to $338.1 million from $310.2 million in the prior quarter. The average reserve per default also increased to $19.0 thousand Rollforward of Insured Loans in Default | Metric | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Beginning Default Inventory | 18,439 | 15,906 | | New Defaults | 9,664 | 11,136 | | Cures | (10,173) | (8,408) | | **Ending Default Inventory** | **17,759** | **18,439** | Reserve for Losses and LAE (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Reserve for Losses and LAE** | **$338,128** | **$310,156** | | Average Reserve per Default (Total) | $19.0 | $16.8 | [Capital and Risk Management](index=10&type=section&id=Capital%20and%20Risk%20Management) This section outlines Essent's strategies for managing capital and risk, including its reinsurance programs, investment portfolio composition, and capital adequacy metrics [Reinsurance Program](index=10&type=section&id=Reinsurance%20Program) Essent actively utilizes reinsurance to manage its risk exposure. As of Q1 2025, the company had significant risk ceded through Insurance-Linked Notes (ILN), Excess of Loss (XOL), and Quota Share agreements. These programs provide substantial capital relief, reducing the PMIERs Minimum Required Assets by over $1.8 billion in total - GSE and other risk share programs had **$2.22 billion of risk in force** as of March 31, 2025[29](index=29&type=chunk) Reinsurance Program Highlights (as of March 31, 2025) | Program Type | Remaining Ceded Risk in Force | Reduction in PMIERs Assets | | :--- | :--- | :--- | | Insurance Linked Notes (ILN) | $1.14 billion | $958.7 million | | Excess of Loss (XOL) | $0.34 billion | $229.0 million | | Quota Share | $8.98 billion | $648.3 million | [Investment Portfolio](index=16&type=section&id=Investment%20Portfolio) The company's investment portfolio, valued at $5.88 billion as of March 31, 2025, is highly rated and diversified. 98.6% of the portfolio is rated Baa3 or higher. The largest allocations are to corporate debt securities (31.7%) and U.S. agency mortgage-backed securities (19.8%). The pre-tax investment income yield for the quarter was 3.77% - Total investments available for sale stood at **$5.88 billion**, with the largest allocations in Corporate debt (**31.7%**), U.S. agency MBS (**19.8%**), and Asset-backed securities (**12.7%**)[44](index=44&type=chunk) - The portfolio maintains high credit quality, with **48.1% rated Aaa** and **98.6% rated investment grade** (Baa3 or higher)[44](index=44&type=chunk) - The pre-tax investment income yield for Q1 2025 was **3.77%**[46](index=46&type=chunk) [Capital Adequacy](index=17&type=section&id=Capital%20Adequacy) Essent remains well-capitalized. The combined statutory capital for U.S. Mortgage Insurance Subsidiaries was $3.64 billion. For Essent Guaranty, Inc., the PMIERs sufficiency ratio was 172%, with $1.52 billion in excess available assets over the minimum required, demonstrating a strong capital buffer Essent Guaranty, Inc. PMIERs Data (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Available Assets | $3,628,675 | $3,612,993 | | Minimum Required Assets | $2,107,620 | $2,029,738 | | **PMIERs Excess Available Assets** | **$1,521,055** | **$1,583,255** | | **PMIERs Sufficiency Ratio** | **172%** | **178%** | - The risk-to-capital ratio for Essent Guaranty, Inc. improved to **9.6:1** from 9.8:1 in the prior quarter[48](index=48&type=chunk) [Segment Information](index=18&type=section&id=Segment%20Information) This section details the financial performance of Essent's Mortgage Insurance segment and the Corporate & Other category, including key revenue, expense, and profitability metrics [Mortgage Insurance Segment](index=18&type=section&id=Mortgage%20Insurance%20Segment) The Mortgage Insurance segment generated income before tax of $214.5 million in Q1 2025, down from $223.6 million in Q1 2024. Net premiums earned were stable at $233.6 million. The loss ratio increased to 13.1% from 4.1% YoY, while the expense ratio was 18.7%. This resulted in a combined ratio of 31.8% for the quarter Mortgage Insurance Segment Performance (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Premiums Earned | $233,630 | $230,306 | | Total Revenues | $288,869 | $274,748 | | Provision for Losses and LAE | $30,722 | $9,337 | | **Income Before Income Tax** | **$214,540** | **$223,566** | Key Ratios | Ratio | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | Loss Ratio | 13.1% | 16.3% | 4.1% | | Expense Ratio | 18.7% | 17.5% | 18.2% | | **Combined Ratio** | **31.8%** | **33.8%** | **22.3%** | [Corporate & Other](index=19&type=section&id=Corporate%20%26%20Other) The Corporate & Other category, which includes title insurance operations and holding company activities, reported a loss before income tax of $7.5 million in Q1 2025. This is an improvement from the $9.8 million loss reported in Q1 2024. The improvement was primarily driven by higher net investment income Corporate & Other Performance (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenues | $28,689 | $23,609 | | Total Losses and Expenses | $36,230 | $33,433 | | **Loss Before Income Tax** | **($7,541)** | **($9,824)** |

Group 1 - Essent Group Ltd. is set to release its Q1 earnings results on May 9, with expected earnings of $1.65 per share, a decrease from $1.70 per share in the same period last year [1] - The company anticipates quarterly revenue of $310.79 million, up from $298.36 million a year earlier [1] - In the previous quarter, Essent Group reported weaker-than-expected earnings [1] Group 2 - Essent Group shares increased by 0.6%, closing at $58.72 [2] - Analysts have provided various ratings and price targets for Essent Group, with Keefe, Bruyette & Woods maintaining an Outperform rating and lowering the price target from $71 to $65 [7] - JP Morgan upgraded the stock from Neutral to Overweight with a price target of $60, while RBC Capital reiterated an Outperform rating with a price target of $67 [7]