NMIH Outperforms Industry, Trades Near 52-Week High: Time to Hold?

Core Insights - NMI Holdings Inc. (NMIH) shares have increased by 15.1% over the past year, outperforming the industry growth of 7.8% [1] - The company has a market capitalization of $3.19 billion, with an average trading volume of 0.4 million shares over the last three months [2] - NMIH's stock closed at $41.21, close to its 52-week high of $43.20, indicating strong investor confidence and potential for further price appreciation [3] - Earnings for NMIH have grown by 15.7% over the last five years, with a solid track record of beating earnings estimates [4] - NMIH shares are trading at a forward price-to-book value of 1.26X, lower than the industry average of 1.48X, indicating attractive valuation [5] Growth Projections - NMIH is positioned to benefit from growth in the mortgage insurance sector, supported by a robust reinsurance strategy [9] - The Zacks Consensus Estimate for NMIH's 2025 earnings per share indicates an 8.6% year-over-year increase, with revenues expected to reach $704.54 million, reflecting a 7.9% improvement [10] - The average price target from analysts for NMIH is $44.71 per share, suggesting a potential upside of 10.1% from the last closing price [11] Financial Performance - NMIH's return on equity (ROE) for the trailing 12 months was 16.08%, significantly higher than the industry's 8.04%, indicating efficient use of shareholders' funds [13] - The company is focused on enhancing its return profile and managing expenses, with a new $250 million share repurchase program authorized through December 31, 2027 [16] - NMIH is expected to generate solid mid-teens returns for shareholders [17] Strategic Positioning - NMIH is well-positioned for growth with new primary insurance written and a comprehensive reinsurance program [18] - The company is expected to benefit from favorable growth estimates and the affordability of its shares, making it a stock to hold [19]