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]

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]

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]

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]

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]

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]

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]

Risk in Force Composition - The original risk written in 2025 was $2.6 billion, with 99.4% remaining [6] - The original risk written in 2004 & Prior was $181.5 billion, with only 0.2% remaining [6] - Loans with an original LTV (loan-to-value) of 85% or less accounted for 3.7% of the primary risk in force as of March 31, 2025 [6] - Loans with an original LTV between 90.01% and 95.00% accounted for 53.3% of the primary risk in force as of March 31, 2025 [6] - Loans with FICO scores of 760 and greater represent 44.0% of the primary risk in force [6] Delinquency and Losses - The delinquency rate (based on loan count) was 2.3% [7] - Ever-to-date claims paid for the 2005-2008 origination year reached $13,388.3 million [7] - New notices previously delinquent accounted for 66.8% [7] Financial Performance - Net losses incurred for Q1 2025 were $10 million, after considering prior period development [12] - Direct primary loss reserves totaled $404 million as of March 31, 2025 [13] Capital and Risk Management - Total PMIERs (Primary Mortgage Insurer Eligibility Requirements) Primary Minimum Required Assets were $5,749 million, with $3,310 million retained [11] - The company ceded 42% of its risk through various reinsurance arrangements [11] - Scheduled Contingency Reserve Releases for 2025 totaled $457 million [39], with $112 million released as of March 31, 2025 [40]

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]