Core Insights - NMI Holdings Inc. (NMIH) reported third-quarter 2025 operating net income per share of $1.21, matching the Zacks Consensus Estimate, with a year-over-year increase of 5.2% [1][7] - The quarterly results were driven by higher premiums earned, improved net investment income, and consistent growth in the high-quality insured portfolio, although this was offset by lower persistency [1] Operational Update - Total operating revenues for NMI Holdings reached $179 million, reflecting a 7.8% year-over-year increase, driven by a 5.5% rise in net premiums earned and a 19.1% increase in net investment income, surpassing the Zacks Consensus Estimate by 2.3% [2] - Primary insurance in force grew by 5.2% to $218.4 billion, while annual persistency decreased to 83.9%, down 160 basis points year over year [2] - New insurance written amounted to $13 billion, marking a 6.4% increase year over year [2] Underwriting and Operating Expenses - Underwriting and operating expenses totaled $29.2 million, showing a slight decrease of 0.01% year over year [3] - Insurance claims and claim expenses surged by 80.5% year over year to $18.6 million, resulting in a loss ratio of 12.3, which deteriorated by 510 basis points [3] - The adjusted expense ratio improved by 100 basis points to 19.3, while the adjusted combined ratio worsened by 400 basis points to 31.5 [3] Financial Update - Book value per share increased by 17.8% year over year to $32.62 as of September 30, 2025 [4] - Cash and cash equivalents stood at $130.4 million, more than doubling from the end of 2024, while the debt balance rose by 0.3% to $416.5 million [4] - The annualized adjusted return on equity contracted by 200 basis points to 15.5% year over year [4] PMIERs and Risk-Based Assets - Total PMIERs available assets were reported at $3.4 billion, with net risk-based required assets totaling $2 billion at the end of the third quarter of 2025 [5]

分组1 - NMI Holdings reported quarterly earnings of $1.21 per share, matching the Zacks Consensus Estimate, and showing an increase from $1.15 per share a year ago [1] - The company posted revenues of $178.68 million for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 2.28% and up from $166.09 million year-over-year [2] - NMI Holdings has surpassed consensus EPS estimates two times in the last four quarters and topped consensus revenue estimates three times in the same period [2][3] 分组2 - The stock has added about 0.1% since the beginning of the year, underperforming the S&P 500, which gained 16.5% [3] - The current consensus EPS estimate for the upcoming quarter is $1.22 on revenues of $176.73 million, and for the current fiscal year, it is $4.92 on revenues of $698.45 million [7] - The Zacks Industry Rank for Insurance - Property and Casualty is in the top 27% of over 250 Zacks industries, indicating a favorable outlook for the sector [8]

Financial Data and Key Metrics Changes - In Q3 2025, the company achieved record total revenue of $178.7 million, with GAAP net income of $96 million, translating to $1.22 per diluted share and a return on equity of 15.6% [10][12] - The company generated $13 billion of new insurance written (NIW) and ended the period with a record $218.4 billion of primary insurance in force, reflecting a 2% increase from Q2 and a 5% increase compared to Q3 2024 [10][12] - The expense ratio reached a record low of 19.3%, indicating significant operating leverage and efficient cost management [11][12] Business Line Data and Key Metrics Changes - The company reported net premiums earned of $151.3 million in Q3, up from $149.1 million in Q2 and $143.3 million in Q3 2024 [11] - Investment income for the quarter was $26.8 million, compared to $24.9 million in Q2 and $22.5 million in Q3 2024 [11] Market Data and Key Metrics Changes - The company noted a 12-month persistency rate of 83.9% in Q3, slightly down from 84.1% in Q2 [10] - The default rate at quarter end was 1.05%, with 7,093 defaults reported, an increase from 6,709 at the end of Q2 [11] Company Strategy and Development Direction - The company emphasized its commitment to providing low-cost down payment support and maintaining a high-quality insured portfolio, positioning itself to capitalize on long-term trends in the housing market [4][8] - The management highlighted the importance of maintaining a robust balance sheet and disciplined expense management to drive growth and shareholder value [7][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the macro environment and housing market, despite potential risks, and noted that the company is well-positioned for continued outperformance [6][8] - The management acknowledged the challenges of new market entrants but emphasized the strength and capacity of the existing players in the private mortgage insurance market [20][22] Other Important Information - The company repurchased $24.6 million of common stock during the quarter, retiring 628,000 shares at an average price of $39.13, with a total repurchase capacity of $256 million remaining [12][13] - Total cash and investments at quarter end were reported at $3.1 billion, with shareholders' equity at $2.5 billion and book value per share at $32.62, reflecting a 4% increase from Q2 and a 16% increase from Q3 2024 [12] Q&A Session Summary Question: Credit performance and new defaults - Management noted that new defaults increased by only 5% year-over-year, indicating a more stable credit environment, and attributed some of the increase to seasonal factors and portfolio seasoning [17][18] Question: Competitive environment and potential new entrants - Management acknowledged awareness of new market entrants but emphasized the challenges of establishing a private mortgage insurance business, suggesting that the current market is well-served by existing players [19][20][22] Question: Consumer strength and housing market observations - Management reported broad economic resilience, with low unemployment and cooling inflation, while noting potential weaknesses in certain housing markets, particularly in Florida and Texas [25][26][28] Question: Reinsurance market dynamics - Management indicated that the reinsurance market remains robust, with favorable pricing achieved, and discussed a preference for traditional reinsurance due to its forward coverage capabilities [29][31] Question: Core yield stability and persistency impacts - Management confirmed that core yield has remained stable at 34 basis points, with expectations for continued stability, while acknowledging potential impacts from refinancing activity [35][36] Question: Proactive strategies for capturing MI on refinanced loans - Management emphasized the importance of maintaining strong relationships with lenders and being present in the market to capture refinancing opportunities, rather than relying on specific strategies [42][43]

Financial Performance - Net premiums earned for the three months ended September 30, 2025, were $151,323 thousand, a 5.9% increase from $143,343 thousand in the same period of 2024[21]. - Net income for the three months ended September 30, 2025, was $95,999 thousand, a 3.3% increase from $92,810 thousand in the same period of 2024[21]. - Earnings per share (EPS) for the three months ended September 30, 2025, were $1.24, up from $1.17 in 2024, reflecting a growth of 6.0%[21]. - Total revenues for the nine months ended September 30, 2025, reached $525,704 thousand, up 8.5% from $484,467 thousand in 2024[21]. - Net income for the nine months ended September 30, 2025, was $294.709 million, compared to $273.939 million for the same period in 2024, reflecting an increase of approximately 7.4%[28]. - Adjusted net income for Q3 2025 was $95,745,000, a 3% increase compared to $92,818,000 in Q3 2024[213]. - Basic earnings per share increased by 6% to $1.24 in Q3 2025 from $1.17 in Q3 2024[197]. - Adjusted diluted EPS for Q3 2025 was $1.21, a 5% increase from $1.15 in Q3 2024[213]. Asset and Liability Management - Total assets increased to $3,727,193 thousand as of September 30, 2025, up from $3,349,973 thousand at December 31, 2024, representing a growth of approximately 11.3%[18]. - Total liabilities increased to $1,212,322 thousand as of September 30, 2025, compared to $1,132,541 thousand at December 31, 2024, an increase of approximately 7.0%[18]. - Shareholders' equity rose to $2,514,871 thousand as of September 30, 2025, compared to $2,217,432 thousand at December 31, 2024, indicating a growth of 13.4%[18]. - The company reported a comprehensive income of $115,102 thousand for the three months ended September 30, 2025, compared to $162,190 thousand in the same period of 2024[21]. Investment Performance - Net investment income rose to $26,773 thousand for the three months ended September 30, 2025, compared to $22,474 thousand in 2024, marking an increase of 19.5%[21]. - The company’s investment income for the nine months ended September 30, 2025, was $76.43 million, an increase of 20.5% from $63.42 million in the same period of 2024[46]. - The investment portfolio had gross unrealized losses of $158.6 million as of December 31, 2024, indicating a decrease in unrealized losses by 39.7% year-over-year[41]. - The amortized cost of total bonds as of September 30, 2025, was $2,960.24 million, with a fair value of $2,897.50 million, indicating a fair value decline of approximately 2.1%[36]. Reinsurance and Risk Management - The company has entered into eight quota share reinsurance treaties to manage risk and support business growth[66]. - Each third-party reinsurance provider involved in the quota share transactions has a financial strength rating of A- or better[69]. - NMIC's reinsurance counterparties are required to maintain an insurer financial strength rating of A- or better, ensuring robust financial backing for the reinsurance agreements[83]. - NMIC ceded aggregate premiums to the Oaktown Re Vehicles of $3.0 million and $9.6 million during the three and nine months ended September 30, 2025, respectively, compared to $4.3 million and $16.1 million during the same periods in 2024[90]. Claims and Default Management - The default rate in NMIC's primary insured portfolio was 1.05% as of September 30, 2025, with 7,093 loans in default out of 677,010 total policies in-force[101]. - The total amount paid for claims during the nine months ended September 30, 2025, was $16.1 million, compared to $5.7 million in 2024, indicating a significant increase of 182%[182]. - Total claims and claim expenses incurred for the three months ended September 30, 2025, were $18.6 million, up from $10.3 million in 2024, representing an increase of 80%[174]. - The beginning balance of gross reserves for insurance claims was $163.0 million as of September 30, 2025, compared to $125.4 million for the same period in 2024, reflecting a 30% increase[174]. Market Conditions and Future Outlook - Macroeconomic factors such as persistent inflation and elevated interest rates could negatively impact future new insurance written (NIW) volume and increase default and claim experiences[134]. - The company anticipates that macroeconomic factors such as housing prices and unemployment rates will significantly influence future claims experience[171]. - The company expects to continue evaluating reinsurance opportunities to manage risk and support business growth[141].

Financial Performance - Net income for Q3 2025 was $96.0 million, or $1.22 per diluted share, compared to $96.2 million, or $1.21 per diluted share in Q2 2025, and $92.8 million, or $1.15 per diluted share in Q3 2024[2]. - Total revenue for Q3 2025 was $178.7 million, compared to $173.8 million in Q2 2025 and $166.1 million in Q3 2024[3]. - Adjusted net income for Q3 2025 was $95.7 million, down 1% from $96.5 million in Q2 2025 but up 3% from $92.8 million in Q3 2024[4]. - Net income for Q3 2025 was $95,999,000, representing a 3.3% increase from $92,810,000 in Q3 2024[20]. - Diluted earnings per share (EPS) for Q3 2025 was $1.22, compared to $1.15 in Q3 2024, reflecting a 6.1% increase[20]. - Total revenues for the nine months ended September 30, 2025, reached $525,704,000, up 8.5% from $484,467,000 in the same period of 2024[20]. Insurance Metrics - Primary insurance-in-force at the end of Q3 2025 was $218.4 billion, up 2% from $214.7 billion in Q2 2025 and 5% from $207.5 billion in Q3 2024[4]. - Net premiums earned were $151.3 million in Q3 2025, a 2% increase from $149.1 million in Q2 2025 and a 6% increase from $143.3 million in Q3 2024[4]. - New insurance written (NIW) for Q3 2025 was $13,012,000, an increase from $12,464,000 in Q2 2025[29]. - The total primary Insurance in Force (IIF) as of September 30, 2025, reached $218,376 million, compared to $214,653 million as of June 30, 2025[41]. - The primary Risk in Force (RIF) as of September 30, 2025, was $58,538 million, an increase from $57,496 million in the previous quarter[41]. Claims and Expenses - Insurance claims and claim expenses rose to $18.6 million in Q3 2025, an increase of 38% from $13.4 million in Q2 2025 and 80% from $10.3 million in Q3 2024[4]. - The loss ratio for Q3 2025 was 12.3%, compared to 9.0% in Q2 2025 and 7.2% in Q3 2024[4]. - The beginning reserve balance for insurance claims and claim expenses was $163,033,000 for Q3 2025, compared to $125,443,000 for Q3 2024, reflecting a 30% increase year-over-year[49]. - Total claims paid for the nine months ended September 30, 2025, amounted to $16,101,000, compared to $5,714,000 in 2024, representing a 182% increase[54]. - The average amount paid per claim for Q3 2025 was $58, compared to $40 in Q3 2024, representing a 45% increase[54]. Asset and Liability Overview - Total assets as of September 30, 2025, were $3,727,193,000, an increase from $3,349,973,000 as of December 31, 2024[22]. - Total liabilities increased to $1,212,322,000 as of September 30, 2025, compared to $1,132,541,000 at the end of 2024[22]. - Available assets as of September 30, 2025, were $3,369,950,000, an increase from $3,006,892,000 in 2024, reflecting a 12% growth[56]. - Net risk-based required assets increased to $2,003,410,000 as of September 30, 2025, from $1,735,790,000 in 2024, indicating a 15% rise[56]. Performance Ratios - The combined ratio for Q3 2025 was 31.5%, up from 27.5% in Q3 2024, indicating a decline in underwriting performance[20][21]. - Annualized return on equity for Q3 2025 was 15.6%, compared to 16.2% in Q2 2025 and 17.5% in Q3 2024[4]. - The loss ratio for Q3 2025 was 12.3%, significantly higher than 7.2% in Q3 2024, indicating increased claims relative to premiums earned[20][21]. Loan and Default Metrics - The default rate for loans increased to 1.05% in Q3 2025 from 1.00% in Q2 2025[29]. - The number of loans in default at the end of Q3 2025 was 7,093, up from 5,712 in Q3 2024, marking a 24% increase[54]. - The average loan size increased to $323,000 in Q3 2025 from $321,000 in Q2 2025[29]. - The cumulative default rate for the book year 2025 was reported at 0.1% as of September 30, 2025[47].

Core Insights - NMI Holdings, Inc. reported a net income of $96.0 million, or $1.22 per diluted share, for Q3 2025, showing slight changes compared to Q2 2025 and Q3 2024 [1][4]. Financial Performance - Net premiums earned increased to $151.3 million in Q3 2025 from $149.1 million in Q2 2025 and $143.3 million in Q3 2024, reflecting a 2% quarter-over-quarter (Q/Q) growth and a 6% year-over-year (Y/Y) growth [3][4]. - Total revenue for Q3 2025 was $178.7 million, up from $173.8 million in Q2 2025 and $166.1 million in Q3 2024 [4]. - Adjusted net income was $95.7 million, slightly down from $96.5 million in Q2 2025 but up from $92.8 million in Q3 2024 [4][3]. - The company’s book value per share (excluding net unrealized gains and losses) rose to $33.32, a 4% increase from Q2 2025 and a 16% increase from Q3 2024 [4][3]. Insurance Metrics - Primary insurance-in-force reached $218.4 billion, up 2% Q/Q and 5% Y/Y [3][4]. - New insurance written (NIW) was $13.0 billion, a 4% increase from Q2 2025 and a 6% increase from Q3 2024 [3][4]. - The loss ratio for Q3 2025 was 12.3%, compared to 9.0% in Q2 2025 and 7.2% in Q3 2024, indicating an increase in claims relative to premiums earned [4][3]. - The expense ratio improved to 19.3% from 19.8% in Q2 2025 and 20.3% in Q3 2024 [4][3]. Operational Highlights - The company maintains a robust balance sheet with total shareholders' equity of $2.5 billion at the end of Q3 2025 [4]. - Annualized return on equity for the quarter was 15.6%, down from 16.2% in Q2 2025 and 17.5% in Q3 2024 [4][3]. - The company’s CEO emphasized the importance of their products and services in the current market, highlighting strong operating performance and growth in their insured portfolio [2].

Core Points - NMI Holdings, Inc. will report its third quarter results for the period ending September 30, 2025, after market close on November 4, 2025 [1] - A conference call and live webcast will be held on the same day at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time [2] - The webcast will be accessible on the company's website, and a replay along with the earnings press release and supplemental information will also be available [2] Company Overview - NMI Holdings, Inc. is the parent company of National Mortgage Insurance Corporation, a private mortgage insurance company in the U.S. [3] - The company enables low-down-payment borrowers to achieve home ownership while providing protection to lenders and investors against losses from borrower defaults [3]

Core Viewpoint - NMI Holdings (NMIH) has faced significant selling pressure, resulting in an 8.8% decline over the past four weeks, but analysts anticipate improved earnings in the near future [1] Group 1: Technical Analysis - The Relative Strength Index (RSI) indicates that NMIH is currently in oversold territory with a reading of 29.42, suggesting a potential reversal in stock price [2][5] - RSI is a momentum oscillator that helps identify overbought or oversold conditions, with values below 30 typically indicating oversold status [2][3] Group 2: Fundamental Analysis - Analysts have raised earnings estimates for NMIH, with a consensus EPS estimate increase of 0.2% over the last 30 days, which often correlates with price appreciation [7] - NMIH holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, indicating strong potential for a turnaround [8]

Core Insights - NMI Holdings, Inc. (NMIH) shares are trading at a discount compared to the Zacks Insurance - Property and Casualty industry, with a price-to-book value of 1.26X versus the industry average of 1.56X [1] - The company has a market capitalization of $3.1 billion and has experienced a year-to-date share price decline of 6.8%, underperforming the Finance sector and the Zacks S&P 500 Composite, which grew by 14.4% and 14.2% respectively [3] Financial Performance - The Zacks Consensus Estimate for NMIH's 2025 earnings per share indicates a year-over-year increase of 9.3%, with revenues projected at $698.5 billion [5] - The expected long-term earnings growth rate for NMIH is 7.1% [9] - Return on equity (ROE) for the trailing 12 months was 14%, significantly higher than the industry's 6.1%, indicating efficient use of shareholders' funds [13] Market Position and Strategy - NMIH benefits from a strong housing market and an increasing reliance on mortgage insurance, expanding its customer base and partnerships [8][14] - The company is focused on disciplined portfolio growth and operational efficiency, which supports profitability and capital strength [17] - NMIH's average price target from analysts suggests an 8.8% upside from the last closing price, indicating potential for future growth [11] Challenges and Risks - Rising defaults and increased claim costs due to a larger policy base could pressure margins and profitability [18][20] - Competitive pressures from repricing and portfolio adjustments may impact revenues and increase operating costs [19] - The company's debt burden of $416 million as of June 30, 2025, poses a risk to financial flexibility and credit profile [20]

Core Insights - Gary Gordon has extensive experience as a stock analyst in the housing, mortgage, and consumer finance industries, primarily at PaineWebber and UBS [1] - He is now retired and serves as an adjunct professor teaching economics and math, including financial literacy seminars [1] Company and Industry Summary - Gordon's career included roles as a U.S. investment strategist and portfolio manager, indicating a strong background in investment analysis [1] - His educational contributions extend to teaching in prisons, highlighting a commitment to financial education and literacy [1] - Gordon holds degrees in philosophy and finance, which may influence his analytical approach in the finance sector [1]