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MGIC (MTG) Upgraded to Strong Buy: Here's Why
ZACKS· 2025-05-26 17:05
Core Viewpoint - MGIC Investment (MTG) has been upgraded to a Zacks Rank 1 (Strong Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the importance of changing earnings estimates in determining near-term stock price movements, making it a valuable tool for investors [2][4]. - The upgrade for MGIC reflects a positive outlook on its earnings, which could lead to increased buying pressure and a rise in stock price [3][5]. Earnings Estimate Revisions - Empirical research indicates a strong correlation between earnings estimate revisions and stock price movements, highlighting the importance of tracking these revisions for investment decisions [6]. - The Zacks Rank system classifies stocks based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. Current Earnings Estimates for MGIC - MGIC is projected to earn $2.90 per share for the fiscal year ending December 2025, reflecting a year-over-year change of -0.3% [8]. - Over the past three months, the Zacks Consensus Estimate for MGIC has increased by 7.1%, indicating a positive trend in earnings estimates [8]. Zacks Rating System Overview - The Zacks rating system maintains a balanced distribution of 'buy' and 'sell' ratings across its universe of over 4000 stocks, with only the top 5% receiving a 'Strong Buy' rating [9]. - The upgrade of MGIC to a Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].
MGIC Investment (MTG) Now Trades Above Golden Cross: Time to Buy?
ZACKS· 2025-05-26 14:55
Group 1 - MGIC Investment Corporation (MTG) has reached a significant support level and is considered a good pick for investors from a technical perspective due to a recent "golden cross" formation [1] - The golden cross occurs when a stock's short-term moving average (50-day) breaks above its long-term moving average (200-day), indicating a bullish breakout [1][2] - MTG has experienced a rally of 7.3% over the past four weeks and currently holds a 1 (Strong Buy) rating on the Zacks Rank, suggesting potential for further gains [3] Group 2 - The positive earnings outlook for MTG is reinforced by the fact that no earnings estimates have been cut for the current quarter, with three revisions higher in the past 60 days [3] - The Zacks Consensus Estimate for MTG has also increased, further supporting the bullish case for the stock [3][5] - Given the positive technical factors and the movement in earnings estimates, investors are encouraged to monitor MTG for potential gains in the near future [5]
Best Momentum Stocks to Buy for May 22nd
ZACKS· 2025-05-22 15:01
Group 1 - Fortis Inc. (FTS) is a Canadian electric and gas utility company with a Zacks Rank 1, and its current year earnings estimate increased by 4.2% over the last 60 days [1] - Fortis' shares have gained 9.5% over the last three months, while the S&P 500 declined by 1%, indicating strong performance [1] - The company has a Momentum Score of A, reflecting its strong momentum characteristics [1] Group 2 - MGIC Investment Corporation (MTG) is a mortgage insurance company with a Zacks Rank 1, and its current year earnings estimate increased by 1.8% over the last 60 days [2] - MGIC's shares have gained 8.9% over the last three months, compared to the S&P 500's decline of 1%, showcasing solid performance [2] - The company possesses a Momentum Score of B, indicating good momentum characteristics [2]
MTG Near 52-Week High: Time to Buy the Stock for Solid Returns?
ZACKS· 2025-05-21 13:15
Core Viewpoint - MGIC Investment Corporation (MTG) is experiencing strong investor confidence, with its stock price near a 52-week high, indicating potential for further price appreciation [1] Stock Performance - MTG shares closed at $26.61, close to its 52-week high of $26.92, and are trading above the 50-day and 200-day simple moving averages of $24.57 and $24.68, respectively, suggesting solid upward momentum [1] - The stock has gained 28% over the past year, outperforming the Finance sector and the Zacks S&P 500 composite, which grew by 18.6% and 12.1%, respectively [5][6] Market Capitalization and Trading Volume - The market capitalization of MGIC Investment is $6.31 billion, with an average trading volume of 2.45 million shares over the last three months [2] Valuation Metrics - MTG shares are trading at a price to forward 12-month earnings ratio of 1.23X, which is lower than the industry average of 2.45X, indicating a better entry point for investors [9] - The company has a Value Score of B, suggesting it is attractively priced compared to other insurers [9] Financial Performance - Return on invested capital (ROIC) has been increasing, currently at 11.4%, significantly higher than the industry average of 2% [10] - Earnings have grown by 12% over the past five years, surpassing the industry average growth of 10.3% [11] Growth Projections - The Zacks Consensus Estimate for 2025 revenues is $1.25 billion, reflecting a year-over-year improvement of 2.9% [11] - Analysts have raised estimates for 2025 and 2026, with the consensus moving up by 1.4% and 2.4%, respectively, in the last 30 days [13] Business Drivers - New business and solid annual persistency are expected to drive growth in the insurance-in-force portfolio, supported by higher home sales and improved refinance activity [14] - A decline in claim filings is strengthening the balance sheet and improving the financial profile of MGIC Investment [14] Capital Position and Shareholder Returns - The company is improving its capital position through capital contributions and reinsurance transactions, with $232.9 million remaining in its authorization for share repurchases through December 2026 [15] - Higher premiums and outstanding credit quality are anticipated to continue driving growth, with share buybacks reflecting capital strength and attractive share price levels [17][18]
Here's Why MGIC Investment (MTG) is a Great Momentum Stock to Buy
ZACKS· 2025-05-06 17:05
Core Viewpoint - Momentum investing focuses on following a stock's recent price trends, aiming to buy high and sell higher, with the expectation that established trends will continue [1] Company Overview: MGIC Investment (MTG) - MGIC Investment currently holds a Momentum Style Score of B, indicating a positive momentum outlook [2] - The company has a Zacks Rank of 2 (Buy), suggesting strong potential for outperformance in the market [3] Performance Metrics - MTG shares have increased by 7.76% over the past week, outperforming the Zacks Insurance - Multi line industry, which rose by 2.89% [5] - Over the past month, MTG's price change is 15.63%, compared to the industry's 12.15% [5] - In the last quarter, MTG shares rose by 4.12%, and over the past year, they gained 24.3%, while the S&P 500 saw movements of -6.46% and 11.69%, respectively [6] Trading Volume - The average 20-day trading volume for MTG is 1,973,910 shares, which serves as a bullish indicator when combined with rising stock prices [7] Earnings Outlook - In the past two months, two earnings estimates for MTG have increased, raising the consensus estimate from $2.73 to $2.79 [9] - For the next fiscal year, two estimates have also moved upwards, with no downward revisions noted [9] Conclusion - Given the positive momentum indicators and earnings outlook, MTG is positioned as a strong buy candidate for investors seeking short-term opportunities [11]
MGIC Investment: Solid Results Appear To Be In The Price
Seeking Alpha· 2025-05-04 02:09
Group 1 - MGIC Investment Corporation (NYSE: MTG) shares have increased by 27% over the past year and are close to their 52-week high [1] - The company has no direct exposure to tariffs, which positions it favorably in the current economic environment [1] - Elevated home prices contribute positively to the company's business outlook [1]
MGIC Investment Q1 Earnings Top, Insurance in Force Rises
ZACKS· 2025-05-01 20:20
Core Viewpoint - MGIC Investment Corporation reported strong first-quarter 2025 results with operating net income per share of 75 cents, exceeding estimates and showing a year-over-year increase of 15.4% [1] Financial Performance - Total operating revenues reached $305 million, a 0.7% increase year over year, but fell short of consensus estimates by 1.5% [2] - Book value per share increased by 2.8% year over year to $21.40 as of March 31, 2025 [6] - Shareholder equity was $5.1 billion, down 0.6% from the end of 2024 [6] Operational Metrics - Insurance in force rose by 1% year over year to $293.8 billion, below the Zacks Consensus Estimate of $297 billion [3] - New insurance written was $10.2 billion, reflecting a 12.1% year-over-year increase [3] - Primary delinquency increased by 5.3% to 25,438 loans [4] Investment Income and Premiums - Net premiums written increased by 0.7% year over year to $235 million, which was lower than the estimate of $238.4 million [4] - Net investment income rose by 2.8% year over year to $61.4 million, also below the estimate of $64.3 million [4] Capital Management - The company repurchased 9.2 million shares for $224.3 million in the first quarter and an additional 2.8 million shares for $65.8 million in April [7] - An additional share repurchase program was approved, allowing for the purchase of up to $750 million of common stock by December 31, 2027 [7] Dividend Information - MGIC Investment paid $400 million in dividends to the holding company and declared a dividend of 13 cents per share for shareholders [8]
MGIC Investment (MTG) - 2025 Q1 - Earnings Call Transcript
2025-05-01 14:00
Financial Data and Key Metrics Changes - The company reported net income of $186 million for Q1 2025, with an annualized return on equity of 14.3% [5] - Adjusted net operating income was $0.75 per diluted share, compared to $0.64 per diluted share in the previous year [14] - The in-force insurance ended the quarter at $294 billion, with annual persistency at 85%, remaining relatively flat over the past several quarters [6][11] Business Line Data and Key Metrics Changes - The company wrote $10 billion of new insurance during the quarter, maintaining strong underwriting standards [6] - The in-force premium yield was 38.4 basis points, remaining flat sequentially and year-over-year [18] Market Data and Key Metrics Changes - The delinquency rate decreased by 10 basis points to 2.3%, consistent with seasonal trends [16] - The number of new delinquency notices received was 13,000, down from 14,200 in the previous quarter [16] Company Strategy and Development Direction - The company focuses on maintaining financial strength and flexibility, with a capital management strategy that includes share repurchases and dividends [7][10] - An additional $750 million share repurchase program was approved, reflecting the company's commitment to returning capital to shareholders [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the fundamentals of the housing market, citing demographic trends and increasing housing inventory as positive factors [11] - The company anticipates that uncertainties in the economic environment may persist, but remains optimistic about its ability to navigate these challenges [11] Other Important Information - The company returned $828 million of capital to shareholders through share repurchases and dividends over the past year [19] - The unrealized loss position on the investment portfolio decreased by $66 million, primarily due to a decrease in interest rates [20] Q&A Session Summary Question: Adjustments to pricing or underwriting due to macro uncertainties - Management indicated that they consider a wide range of economic scenarios in their pricing strategy, but no specific changes were made due to tariffs [26][27] Question: Claim rate assumptions and unemployment considerations - The 7.5% new notice claim rate is used for various economic outcomes, and reserves are set to be sufficient across a wide range of scenarios without targeting specific unemployment rates [29][30] Question: Market share volatility and volume - Management acknowledged some volatility in market share but emphasized that it is a competitive industry and fluctuations are expected [35][36]
Compared to Estimates, MGIC (MTG) Q1 Earnings: A Look at Key Metrics
ZACKS· 2025-04-30 23:35
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].
MGIC Investment (MTG) Q1 Earnings Surpass Estimates
ZACKS· 2025-04-30 22:56
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]