MTG Hits 52-Week High: Time to Add the Stock for Better Returns?

Core Insights - MGIC Investment Corporation (MTG) has reached a 52-week high of $28.28, closing at $28.10, with an 18.5% year-to-date gain, outperforming its industry and the S&P 500 composite [2] - The company has a market capitalization of $6.67 billion, with an average trading volume of 1.9 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 [6] - The company has a price-to-book value of 1.3X, which is lower than the industry average of 2.68X, providing a favorable entry point for investors [7] - Return on invested capital (ROIC) has improved to 11.4%, significantly higher than the industry average of 2% [8] Growth Projections - The Zacks Consensus Estimate projects a 0.3% year-over-year increase in earnings per share for 2025, with revenues expected to reach $1.24 billion, reflecting a 1.8% improvement [9] - Earnings have grown by 12% over the past five years, surpassing the industry average of 10.1% [9] - MTG has consistently exceeded earnings estimates in the last four quarters, with an average surprise of 15.88% [10] Analyst Sentiment - Analysts have raised their earnings estimates for MTG for 2025 and 2026, with increases of 6.2% and 5.9%, respectively, over the past 60 days [14] - The company has a VGM Score of B, indicating potential upside and strong investor confidence [19] Market Dynamics - Factors driving MTG's growth include increased new business, solid persistency, and a favorable environment for home sales and refinancing [16] - The company is experiencing a decline in claim filings, which is expected to enhance its financial profile [16] - MTG has a solid capital position, with $232.9 million remaining in its share repurchase authorization through December 2026 [17] Conclusion - Higher premiums, excellent credit quality, and new business are anticipated to drive growth for MGIC Investment [18] - The company's share buyback activities reflect its strong capital position and commitment to generating long-term value for shareholders [18]