Core Viewpoint - MGIC Investment (MTG) reported a slight increase in revenue and a notable rise in EPS for the quarter ended March 2025, although revenue fell short of analyst expectations [1]. Financial Performance - Revenue for the quarter was $305.49 million, reflecting a year-over-year increase of 0.9% [1]. - EPS was reported at $0.75, an increase from $0.65 in the same quarter last year, resulting in a surprise of +13.64% over the consensus estimate of $0.66 [1]. - The revenue reported was -1.46% below the Zacks Consensus Estimate of $310.03 million [1]. Key Metrics - GAAP underwriting expense ratio was 22.5%, lower than the average estimate of 24.4% based on two analysts [4]. - GAAP loss ratio stood at 3.9%, significantly below the average estimate of 16.2% [4]. - Net premiums earned were $243.72 million, slightly below the average estimate of $245.41 million, with a year-over-year change of +0.4% [4]. - Other revenue was reported at $0.33 million, which is -31.3% lower than the average estimate of $0.50 million [4]. - Net investment income was $61.44 million, compared to the average estimate of $64.12 million, marking a year-over-year increase of +2.8% [4]. Stock Performance - Shares of MGIC have returned -2% over the past month, while the Zacks S&P 500 composite experienced a -0.2% change [3]. - The stock currently holds a Zacks Rank 2 (Buy), suggesting potential outperformance against the broader market in the near term [3].

Group 1 - MGIC Investment reported quarterly earnings of $0.75 per share, exceeding the Zacks Consensus Estimate of $0.66 per share, and showing an increase from $0.65 per share a year ago, representing an earnings surprise of 13.64% [1] - The company posted revenues of $305.49 million for the quarter ended March 2025, which was 1.46% below the Zacks Consensus Estimate, and a slight increase from $302.87 million year-over-year [2] - MGIC has surpassed consensus EPS estimates in all four of the last quarters, while it has only topped consensus revenue estimates once during the same period [2] Group 2 - The stock has increased approximately 4.1% since the beginning of the year, contrasting with a decline of 5.5% in the S&P 500 [3] - The current consensus EPS estimate for the upcoming quarter is $0.67, with expected revenues of $312.43 million, and for the current fiscal year, the estimate is $2.75 on revenues of $1.25 billion [7] - The Zacks Industry Rank for Insurance - Multi line is in the top 17% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

Quarterly Supplement Q1 2025 NYSE: MTG Forward-Looking Statements As used below, "we," "our" and "us" refer to MGIC Investment Corporation's consolidated operations or to MGIC Investment Corporation, as the context requires, and "MGIC" refers to Mortgage Guaranty Insurance Corporation. This presentation may contain forward looking statements. Our actual results could be affected by the risks affecting the company which can be found in the risk factors included in our 8-K filing for the quarter ended March 3 ...

Financial Performance - For Q1 2025, net premiums written increased to $235.346 million, up from $233.800 million in Q1 2024, representing a growth of 0.66%[29] - Total revenues for Q1 2025 reached $306.234 million, compared to $294.361 million in Q1 2024, marking an increase of 4.4%[29] - Net income for Q1 2025 was $185.460 million, an increase from $174.097 million in Q1 2024, reflecting a growth of 6.5%[29] - Basic earnings per share rose to $0.76 in Q1 2025, compared to $0.64 in Q1 2024, indicating an increase of 18.75%[29] - Cash flows from operating activities for Q1 2025 were $223,654 thousand, an increase from $190,537 thousand in Q1 2024[35] - Total shareholders' equity at the end of Q1 2025 was $5,139,884 thousand, up from $5,102,343 thousand at the end of Q1 2024[33] Losses and Expenses - Losses incurred, net for Q1 2025 were $9.591 million, significantly higher than $4.555 million in Q1 2024, representing an increase of 110.4%[29] - Other underwriting and operating expenses, net, decreased to $51.406 million in Q1 2025 from $59.018 million in Q1 2024, a reduction of 12.8%[29] - The company reported a decrease in unearned premiums, net, to $8,373 thousand in Q1 2025 from $8,844 thousand in Q1 2024[29] Investment Income - Investment income, net of expenses, increased to $61.443 million in Q1 2025 from $59.744 million in Q1 2024, a rise of 2.84%[29] - The company reported net gains on investments and other financial instruments of $741 thousand for Q1 2025, a significant recovery from net losses of $8,509 thousand in Q1 2024[95] - The company reported net unrealized investment gains of $65,406,000 for the three months ended March 31, 2025, compared to a loss of $13,154,000 in the same period of 2024[117] Stock and Dividends - The company repurchased common stock worth $225,176 thousand in Q1 2025, compared to $95,183 thousand in Q1 2024, indicating a significant increase in stock buybacks[35] - The company declared a quarterly cash dividend of $0.13 per share, totaling $32.5 million in Q1 2025[142] - The company had remaining authorization to repurchase $232.9 million of common stock through December 31, 2026[140] Reinsurance and Risk Management - The company executed a 40% quota share reinsurance (QSR) transaction covering most of its new insurance written in 2026[62] - The company retains the first layer of aggregate losses paid under traditional excess of loss (XOL) transactions, with reinsurers providing second layer coverage[65] - The profit commission for the 2023 QSR is set at 58.5% if the annual loss ratio remains below the specified threshold[62] Comprehensive Income - The company reported a comprehensive income of $237.177 million for Q1 2025, compared to $164.244 million in Q1 2024, reflecting a substantial increase of 44.4%[31] - Other comprehensive income for Q1 2025 was $51,717 thousand, compared to a loss of $9,853 thousand in Q1 2024, showing a significant improvement[31] Shareholder Metrics - The weighted average common shares outstanding for basic shares decreased to 244,147 in Q1 2025 from 270,314 in Q1 2024, a decline of 9.66%[29] - The company repurchased 9.2 million shares for $224.3 million in Q1 2025, compared to approximately 25.3 million shares for $566.6 million in 2024[140] Asset Management - Cash and cash equivalents at the end of Q1 2025 were $212,693 thousand, down from $439,568 thousand at the end of Q1 2024[35] - The company’s Available Assets exceeded its Minimum Required Assets as of March 31, 2025, ensuring compliance with GSEs' PMIERs[41] - Total fixed income securities at fair value as of March 31, 2025, were $5,885,033 thousand, compared to $5,851,689 thousand as of December 31, 2024[87]

Financial Performance - First Quarter 2025 net income was $185.5 million, or $0.75 per diluted share, compared to $174.1 million, or $0.64 per diluted share in Q1 2024, representing a 6.9% increase in net income year-over-year [2][5]. - Adjusted net operating income for Q1 2025 was $185.2 million, or $0.75 per diluted share, up from $178.4 million, or $0.65 per diluted share in Q1 2024, indicating a 3.9% increase [5][22]. - Net premiums earned in Q1 2025 were $243.7 million, slightly up from $242.6 million in Q1 2024 [5][18]. - Book value per share increased to $21.40 in Q1 2025, up from $20.82 in Q4 2024 [26]. - The net premium yield is 33.0% in Q1 2025, compared to 32.9% in Q4 2024 [28]. Insurance Activity - New insurance written (NIW) for Q1 2025 was $10.2 billion, a decrease from $15.9 billion in Q4 2024 and an increase from $9.1 billion in Q1 2024 [5][7]. - New primary insurance written (NIW) for Q1 2025 is $10.2 billion, down from $15.9 billion in Q4 2024 [27]. - New primary risk written for Q1 2025 is $2.6 billion, down from $4.1 billion in Q4 2024 [27]. - The company's NIW on mortgages with LTV ratios greater than 95% was 13% in Q1 2025, compared to 15% in Q1 2024 and 14% for the full year 2024 [103]. - The company's NIW on mortgages with DTI ratios greater than 45% was 31% in Q1 2025, up from 28% in Q1 2024 [103]. Delinquency and Losses - Losses incurred, net for Q1 2025 were $9.6 million, compared to $4.6 million in Q1 2024, resulting in a loss ratio of 3.9% [5][18]. - The beginning delinquent inventory for Q1 2025 was 26,791 loans, decreasing to 25,438 by the end of the quarter, resulting in a delinquency rate of 2.30% [32]. - The company reported a total of 13,981 cures in Q1 2025, an increase from 12,040 in Q4 2024 [32]. - Total gross loss reserves for Q1 2025 stood at $465 million, slightly up from $463 million in Q4 2024 [33]. - Ceded losses incurred in Q1 2025 were $6.4 million, up from $6.1 million in Q4 2024 [35]. Capital Management - The company repurchased 9.2 million shares of common stock for $224.3 million during the quarter and declared a dividend of $0.13 per common share [7]. - The board approved an additional share repurchase program, authorizing up to $750 million of common stock purchases prior to December 31, 2027 [7]. - As of March 31, 2025, the holding company had approximately $824 million in cash and investments, with long-term debt obligations totaling $650 million [128]. - Annual debt service on the long-term debt obligations is approximately $34 million [128]. - MGIC paid $750 million in dividends to the holding company in the twelve months ended March 31, 2025 [127]. Regulatory and Compliance Issues - The PMIERs require significantly more Minimum Required Assets for delinquent loans compared to performing loans, increasing the risk of non-compliance if loan delinquencies rise [60]. - MGIC's compliance with PMIERs is critical, as non-compliance could lead to suspension or termination of eligibility to insure loans purchased by the GSEs, significantly reducing new insurance written [51]. - The proposed regulatory capital rule by the Federal Reserve could impose higher capital standards on large U.S. banks, potentially negatively affecting the company's NIW [78]. - Changes in GSEs' business practices regarding mortgage insurance coverage and costs could negatively impact the mortgage insurance industry and MGIC's financial results [43]. - The GSEs may increase guaranty fees and loan level price adjustments, leading to higher costs for borrowers and potentially affecting MGIC's new insurance written [44]. Market Conditions and Risks - The company experienced a decline in home prices, with a 0.1% increase in the Purchase-Only U.S. Home Price Index in February 2025 compared to January 2025 [40]. - Economic downturns due to wars or pandemics could lead to increased unemployment, inflation, and home price declines, resulting in higher loan delinquencies [42]. - The mortgage insurance industry is highly competitive, with competitors including private mortgage insurers and governmental agencies, which may impact the company's market position [112]. - The widespread use of risk-based pricing systems complicates the comparison of premium rates with competitors, affecting the company's ability to maintain its market share [114]. - Financial strength ratings are crucial for maintaining public confidence and competitive position, with potential downgrades adversely impacting business operations [119]. Operational Risks - The company faces risks related to legal proceedings and regulatory scrutiny, which could materially affect its financial condition and results of operations [120]. - The company relies on third-party reporting for mortgage loan information, which may be subject to inaccuracies that could affect claims [85]. - The company's risk management programs may not effectively identify or mitigate risks, potentially impacting financial results [86]. - The company has delegated authority to GSEs for loss mitigation options, which may not always align with its interests and could increase claims [84]. - The risk of cybersecurity incidents affecting the company may increase, posing a threat to operational stability [42]. Investment Portfolio - The investment portfolio is primarily composed of high-quality, investment-grade fixed income investments, but is subject to risks from economic conditions and interest rate volatility [123]. - The investment portfolio is structured to meet expected liabilities, including claim payments in the mortgage insurance business [126]. - The company invests primarily in investment grade fixed income securities, which are subject to regulatory limitations and may impact investment income [125]. - Concerns over the federal budget deficit and potential political conflicts may increase liquidity risks associated with investments in U.S. government securities [124]. Shareholder Considerations - The market price of the company's common stock may fluctuate significantly due to various economic and industry factors [131]. - The inability of insurance subsidiaries to pay sufficient dividends could adversely affect the holding company's cash requirements and operational capabilities [127]. - Any required capital contributions to subsidiaries would decrease the holding company's cash and investments [129].

Core Viewpoint - MGIC Investment Corporation reported strong financial results for the first quarter of 2025, demonstrating continued performance improvement and market leadership despite macroeconomic concerns [2][3]. Financial Performance - Net income for Q1 2025 was $185.5 million, or $0.75 per diluted share, compared to $184.7 million and $0.72 per diluted share in Q4 2024, and $174.1 million and $0.64 per diluted share in Q1 2024 [4]. - Adjusted net operating income for Q1 2025 was $185.2 million, or $0.75 per diluted share, reflecting a slight increase from $184.5 million and $0.72 per diluted share in Q4 2024, and $178.4 million and $0.65 per diluted share in Q1 2024 [4]. - New insurance written (NIW) was $10.2 billion in Q1 2025, down from $15.9 billion in Q4 2024 and up from $9.1 billion in Q1 2024 [4][20]. - Net premiums earned were $243.7 million, slightly up from $241.3 million in Q4 2024 and $242.6 million in Q1 2024 [4]. - The annual persistency rate was 84.7%, a slight decrease from 84.8% in Q4 2024 and 85.7% in Q1 2024 [4]. Capital and Liquidity - As of March 31, 2025, PMIERs available assets were $5.9 billion, with PMIERs excess at $2.6 billion [4]. - The holding company liquidity was reported at $824 million, down from $1,076 million at the end of Q4 2024 [4]. Shareholder Actions - The company repurchased 9.2 million shares for $224.3 million and an additional 2.8 million shares for $65.8 million through April 25, 2025 [7]. - A dividend of $0.13 per common share was declared, payable on May 21, 2025 [7]. Delinquency and Loss Metrics - Primary delinquency inventory stood at 25,438, down from 26,791 in Q4 2024 [4][24]. - The primary IIF delinquency rate was 2.30%, a decrease from 2.40% in Q4 2024 [4][24]. - Losses incurred, net, were $9.6 million, compared to $8.7 million in Q4 2024 and $4.6 million in Q1 2024 [4]. Market Position and Strategy - The company maintains a strong market position with robust capital and liquidity, allowing it to continue executing its business strategies and supporting customers with innovative solutions [2][3].

Core Insights - MGIC Investment (MTG) has a strong history of beating earnings estimates and is well-positioned for continued success in upcoming reports [1][2] - The company has surpassed earnings estimates by an average of 12.85% over the last two quarters, with recent surprises of 10.77% and 14.93% [2] Earnings Performance - In the most recent quarter, MGIC reported earnings of $0.72 per share against an expectation of $0.65, resulting in a surprise of 10.77% [2] - For the previous quarter, the consensus estimate was $0.67 per share, while the actual earnings were $0.77, leading to a surprise of 14.93% [2] Earnings Estimates and Predictions - Recent estimates for MGIC have been increasing, with a positive Earnings ESP (Expected Surprise Prediction) indicating potential for another earnings beat [5][8] - The current Earnings ESP for MGIC is +7.04%, suggesting analysts are optimistic about the company's near-term earnings potential [8] Zacks Rank and Success Rate - MGIC holds a Zacks Rank of 2 (Buy), which, when combined with a positive Earnings ESP, indicates a high likelihood of beating earnings estimates [8] - Research indicates that stocks with a positive Earnings ESP and a Zacks Rank of 3 (Hold) or better have a nearly 70% success rate in beating consensus estimates [6]

Company Announcement - MGIC Investment Corporation plans to release its first quarter 2025 financial results after the market closes on April 30, 2025 [1] - A conference call/webcast is scheduled for May 1, 2025, at 10:00 a.m. Eastern Time to discuss the quarterly results [1] Participation Details - Individuals interested in joining the conference call must register to receive the dial-in number and unique PIN [2] - It is recommended to join the call at least 10 minutes early, and the call will also be available via webcast on the Company's Investor website [2] - A replay of the webcast will be accessible on the Company's website until June 2, 2025 [2] Company Overview - Mortgage Guaranty Insurance Corporation (MGIC) is the principal subsidiary of MGIC Investment Corporation, providing private mortgage insurance to lenders across the United States [3] - MGIC helps families achieve homeownership by making affordable low-down-payment mortgages possible [3] Information Dissemination - MGIC Investment Corporation releases important information through its corporate website and encourages investors to enroll for automatic email alerts and RSS feeds regarding new postings [4]

Group 1 - The core concept of momentum investing is to follow a stock's recent price trends, aiming to buy high and sell even higher, with the expectation that established trends will continue [1] - MGIC Investment (MTG) currently holds a Momentum Style Score of B, indicating a favorable position in the momentum investing framework [3] - The Zacks Rank for MGIC Investment is 2 (Buy), suggesting that stocks with this rating and a Style Score of A or B tend to outperform the market in the following month [4] Group 2 - Over the past week, MTG shares increased by 1.95%, outperforming the Zacks Insurance - Multi line industry, which rose by 0.58% [6] - In the last quarter, MTG shares rose by 4.34%, and over the past year, they increased by 11.79%, while the S&P 500 experienced declines of -5.11% and a modest gain of 11.13%, respectively [7] - The average 20-day trading volume for MTG is 3,407,273 shares, indicating a bullish sign when combined with rising stock prices [8] Group 3 - Recent earnings estimates for MTG have shown positive revisions, with two estimates moving higher for the full year, raising the consensus estimate from $2.71 to $2.74 [10] - For the next fiscal year, one estimate has increased, with no downward revisions noted, reflecting a positive earnings outlook for MTG [10] Group 4 - Given the favorable momentum indicators and earnings outlook, MGIC Investment is positioned as a strong candidate for near-term investment opportunities [12]

Core Viewpoint - MGIC Investment (MTG) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - Institutional investors often rely on earnings estimates to determine the fair value of a company's shares, leading to buying or selling actions that affect stock prices [4]. Company Performance and Outlook - The upgrade for MGIC reflects an improvement in the company's underlying business, suggesting that investors may push the stock price higher in response to rising earnings estimates [5][10]. - Analysts have raised their earnings estimates for MGIC, with the Zacks Consensus Estimate for the fiscal year ending December 2025 projected at $2.74 per share, representing a year-over-year decline of 5.8% [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have generated an average annual return of +25% since 1988 [7]. - The upgrade of MGIC to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [10].