Core Points - MGIC Investment Corporation plans to release its third quarter 2025 financial results on October 29, 2025, after market close [1] - A conference call/webcast is scheduled for October 30, 2025, at 10:00 a.m. Eastern Time to discuss the quarterly results [1][2] - The company encourages interested individuals to register for the call and join at least 10 minutes early [2] Company Overview - MGIC, the principal subsidiary of MGIC Investment Corporation, provides private mortgage insurance to lenders across the United States, facilitating affordable low-down-payment mortgages [3] - The company aims to help families achieve homeownership sooner through its services [3] Investor Communication - MGIC Investment Corporation releases important information via its corporate website and encourages investors to enroll for automatic email alerts and RSS feeds regarding new postings [4] - The company intends to continue this practice for future disclosures [4]

Company Overview - MGIC Investment (MTG) is a mortgage insurance company headquartered in Milwaukee, operating in the Finance sector [3] - The stock has experienced a price change of 19.15% since the beginning of the year [3] Dividend Information - MGIC Investment currently pays a dividend of $0.15 per share, resulting in a dividend yield of 2.12%, which is higher than the Insurance - Multi line industry's yield of 1.71% and the S&P 500's yield of 1.51% [3] - The company's annualized dividend of $0.60 has increased by 22.4% from the previous year [4] - Over the past 5 years, MGIC Investment has raised its dividend 4 times, averaging an annual increase of 20.17% [4] - The current payout ratio is 17%, indicating that the company pays out 17% of its trailing 12-month EPS as dividends [4] Earnings Growth Expectations - For the fiscal year, MTG anticipates solid earnings growth, with the Zacks Consensus Estimate for 2025 at $3.01 per share, reflecting a 3.44% increase from the previous year [5] Investment Considerations - MGIC Investment is viewed as a compelling investment opportunity due to its strong dividend profile and current Zacks Rank of 3 (Hold) [6] - The company is positioned well for income investors, especially in the context of rising interest rates, where high-yielding stocks may face challenges [6]

Core Insights - MGIC Investment Corporation (MTG) has reached a 52-week high of $28.67, closing at $27.83, with a year-to-date gain of 17.4%, outperforming its industry and the S&P 500 composite [2] - The company has a market capitalization of $6.41 billion, with an average trading volume of 2.1 million shares over the last three months [3] - MTG is trading above its 50-day and 200-day simple moving averages, indicating strong upward momentum [4] Financial Performance - MTG is expanding its insurance-in-force portfolio through robust new business and high annual persistency [7] - The company has a price-to-book value of 1.25X, significantly lower than the industry average of 2.48X, making it an attractive entry point for investors [8] - The return on invested capital (ROIC) has improved to 11.2%, well above the industry average of 2% [9] - Earnings have grown by 12% over the past five years, surpassing the industry average of 9.8% [11] Growth Projections - The Zacks Consensus Estimate projects a 3.4% year-over-year increase in earnings per share for 2025, with revenues expected to reach $1.23 billion, reflecting a 0.9% increase [10] - Analysts have raised their estimates for 2025 and 2026, with the consensus for 2025 earnings moving up by 4.1% [13] Market Dynamics - New business and solid annual persistency are expected to drive growth, supported by increased home sales and refinancing activity [16] - The company is witnessing a decline in claim filings, which will strengthen its financial profile [16] - MTG is enhancing its capital position through capital contributions and reinsurance transactions, with $742.2 million remaining in its authorization for share repurchases through December 2026 [17] Strategic Outlook - Higher premiums, excellent credit quality, and new business are anticipated to continue driving growth for MGIC Investment [18] - The company engages in share buybacks as part of wealth distribution to shareholders, reflecting its capital strength and financial performance [18] - Optimistic analyst sentiment and favorable ROIC are expected to benefit MGIC Investment in the long term [19]

Company Overview - MGIC Investment (MTG) is a mortgage insurance company headquartered in Milwaukee, with a price change of 11.6% so far this year [3] - The company currently pays a dividend of $0.13 per share, resulting in a dividend yield of 2.27%, which is higher than the Insurance - Multi line industry's yield of 1.92% and the S&P 500's yield of 1.51% [3] Dividend Performance - The current annualized dividend of MGIC Investment is $0.60, reflecting a 22.4% increase from the previous year [4] - Over the past 5 years, MGIC has increased its dividend 4 times year-over-year, achieving an average annual increase of 20.17% [4] - The company's current payout ratio is 17%, indicating that it paid out 17% of its trailing 12-month earnings per share as dividends [4] Earnings Growth - The Zacks Consensus Estimate for MGIC Investment's earnings in 2025 is $2.97 per share, representing a year-over-year earnings growth rate of 2.06% [5] - The company is viewed as an attractive dividend play and a compelling investment opportunity, currently holding a Zacks Rank of 2 (Buy) [6]

Core Viewpoint - MGIC Investment Corporation received upgrades from Moody's Ratings, reflecting its strong performance and financial stability [1][2]. Group 1: Ratings Upgrade - Moody's upgraded MGIC's senior unsecured debt rating to Baa2 from Baa3 [1]. - The insurance financial strength rating of MGIC's principal operating subsidiary, Mortgage Guaranty Insurance Corporation, was upgraded to A2 from A3 [1]. - The outlook for both ratings is stable [1]. Group 2: Rationale for Upgrade - The upgrades were based on MGIC's consistent performance, good net capital generation, and robust profitability and capital adequacy [2]. Group 3: Company Positioning - The CEO of MGIC expressed satisfaction with the upgrades, highlighting the company's market leadership and disciplined approach [3]. - MGIC aims to continue executing its business strategies and creating long-term value for stakeholders [3].

Core Viewpoint - MGIC Investment Corporation (MTG) reported strong second-quarter 2025 results, with operating net income per share of 82 cents, exceeding expectations and showing a year-over-year increase of 6.5% [1][7]. Financial Performance - Total operating revenues for MGIC Investment were $306 million, remaining flat year over year, and slightly missing the consensus estimate by 0.4% [2]. - The book value per share increased by 12.9% from the end of 2024 to $22.11 as of June 30, 2025 [5]. - Shareholder equity stood at $5.2 billion, a decrease of 0.3% from the end of 2024 [5]. - MGIC paid $400 million in dividends to the holding company and declared a dividend of 15 cents per share to be paid on August 21, 2025 [8]. Operational Metrics - Insurance in force rose by 1.9% year over year to $297 billion, falling short of the Zacks Consensus Estimate of $299 billion [3]. - Primary delinquency increased by 4.6% year over year to 24,444 loans [3][7]. - New insurance written reached $16.4 billion, marking a significant year-over-year increase of 21.5% [4][7]. - The loss ratio for the quarter was negative 1.2%, an improvement from negative 7.5% in the same quarter of the previous year [4]. Capital Management - MGIC repurchased 7.1 million shares for $180.7 million and has an additional share repurchase program authorized for up to $750 million [6]. - As of July 25, 2025, MGIC repurchased an additional 2.6 million shares for $68 million [6]. Industry Comparison - Other insurers like Prudential Financial, Everest Group, and Chubb Limited also reported positive results in Q2 2025, with adjusted operating incomes and total revenues beating consensus estimates [10][11][12].

Financial Data and Key Metrics Changes - The company recorded net income of $193 million and an annualized return on equity of 15% for the second quarter [5] - Adjusted net operating income was $0.82 per diluted share compared to $0.77 in the same period last year, while net income per diluted share increased to $0.81 from $0.77 [11] - Book value per share increased to $22.11, reflecting a 13% year-over-year growth [12] Business Line Data and Key Metrics Changes - The company wrote $16 billion of new insurance during the quarter, with insurance in force ending at $297 billion [5] - Annual persistency remained at 85%, with both insurance in force and annual persistency remaining relatively flat over the past two quarters [6] Market Data and Key Metrics Changes - The delinquency rate decreased by nine basis points to 2.21%, consistent with seasonal trends [13] - The company received 12,000 new delinquency notices, which is 5% higher than the second quarter of last year but 7% lower than 2019 [14] Company Strategy and Development Direction - The company focuses on maintaining financial strength and flexibility to navigate various economic scenarios, with a commitment to returning excess capital to shareholders through share repurchases and dividends [7][8] - The company has authorized a 15% increase in its quarterly common stock dividend to $0.15 per share, marking five consecutive years of dividend increases [9] Management Comments on Operating Environment and Future Outlook - The housing market faces challenges from elevated interest rates and affordability issues, but demographic trends and pent-up demand are expected to support long-term growth in mortgage insurance opportunities [9] - The company remains focused on disciplined risk management and strong underwriting standards to maintain a high-quality portfolio [6] Other Important Information - The company paid a quarterly common stock dividend of $0.13 per share, totaling $31 million, and repurchased 7.1 million shares for $181 million during the second quarter [7] - The unrealized loss position on the investment portfolio narrowed by $36 million due to a decrease in interest rates [17] Q&A Session Summary Question: Can you remind us how you are thinking about sizing the level of capital return? - The company has been paying dividends in the range of $300 to $400 million every six months, driven by excellent credit performance and financial results [24] Question: Could there be a case where you could increase the payout further? - The company is constrained by its contingency reserve balance, but as long as capital levels remain above targets, dividends at similar levels to previous years are expected [28][29] Question: Can you talk about your expectation for home prices? - National home prices are forecasted to be flat over the next several years, with different dynamics in various regions [33] Question: Does the OpEx guidance exclude the $4 million charge? - Yes, the $4 million charge is included in the Q2 number and the full-year guidance, with expectations for smaller charges in the future [37]

Financial Data and Key Metrics Changes - The company recorded net income of $193 million and an annualized return on equity of 15% for the second quarter [5] - Adjusted net operating income was $0.82 per diluted share compared to $0.77 in the same period last year, while net income per diluted share increased to $0.81 from $0.77 [12] - Book value per share increased to $22.11, reflecting a 13% year-over-year growth [12] Business Line Data and Key Metrics Changes - The company wrote $16 billion of new insurance during the quarter, with insurance in force ending at $297 billion [5] - Annual persistency remained at 85%, with both insurance in force and annual persistency remaining relatively flat over the past two quarters [6] Market Data and Key Metrics Changes - The housing market continues to face challenges from elevated interest rates and affordability issues, but demographic trends and pent-up demand are expected to support long-term growth in mortgage insurance opportunities [10] - Nationally, home price growth has moderated, with rising inventory in many markets, particularly in the South and West [10] Company Strategy and Development Direction - The company focuses on maintaining financial strength and flexibility to navigate various economic scenarios, with objectives including strong capital maintenance and a low to mid-teens debt to capital ratio [7] - The company is committed to returning excess capital to shareholders through share repurchases and dividends, with a 15% increase in quarterly common stock dividend to $0.15 per share [10] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the strong credit performance of the insurance portfolio, with disciplined risk management and strong underwriting standards being key drivers [6] - The company anticipates that if credit performance remains strong, capital levels will stay above targets, supporting elevated payout ratios [10] Other Important Information - The company has a remaining $734 million on its current share repurchase authorization and has repurchased 7.1 million shares for $181 million during the second quarter [9] - The unrealized loss position on the investment portfolio narrowed by $36 million, primarily due to a decrease in interest rates [19] Q&A Session Summary Question: How is the company sizing the level of capital return and the amount of Holdco liquidity? - Management indicated that dividends have been in the range of $300 to $400 million every six months, driven by excellent credit performance and financial results [26] Question: Could there be a case for increasing the payout further given strong capital generation? - Management noted that while there is enough statutory surplus to continue paying dividends, there is a natural limit to how much can be paid out over time [30] Question: What are the expectations for home prices and potential industry pricing adjustments? - Management expects national home prices to remain flat, with different dynamics in various regions, and emphasized the ability to price risk at a granular level [35][36] Question: Is the operating expense guidance inclusive of the $4 million pension charge? - Management confirmed that the $4 million charge is included in the operating expense guidance and that similar charges are expected in the future [39]

Risk in Force Composition - The original risk written in 2025 was $6.9 billion, with 98.1% remaining [6] - The original risk written in 2004 and prior was $181.5 billion, with only 0.2% remaining [6] - For loans originated in 2025, 50.6% had a FICO score of 760 and above [6] - Loans with an original LTV between 90.01% and 95.00% constitute 53.5% of the primary risk in force [6] Delinquency and Losses - The total number of delinquent loans is 24,444 [7] - Risk in force delinquent is 1.9% [7] - Ever-to-date claims paid for the 2005-2008 origination years reached $13.3913 billion [7] PMIERs and Risk Distribution - Total Primary Minimum Required Assets are $5.758 billion [9] - Of the $418 million required for 2025, $192 million is retained, $162 million is covered by Quota-Share Reinsurance (QSR), and $63 million by Excess-of-Loss (XOL), resulting in 54% ceded [9] - The company has a $2.5 billion Reinsurance Benefit [9] Financial Performance - Net losses incurred for Q2 2025 were $(3) million [11] - Direct primary loss reserves totaled $392 million in Q2 2025 [12]

Group 1 - MGIC Investment Corp (MTG) shares have gained 2% over the past year, indicating modest performance [1] - The stock has experienced a pullback in the last month due to increasing concerns about a slowing market [1] Group 2 - The article reflects a contrarian investment approach based on macro views and stock-specific turnaround stories [1]