Breaking News
0

Here's Why Hold Strategy Is Apt For MGIC Investment (MTG)

By Zacks Investment ResearchSep 16, 2019 11:04PM ET
www.investing.com/analysis/heres-why-hold-strategy-is-apt-for-mgic-investment-mtg-200465429
Here's Why Hold Strategy Is Apt For MGIC Investment (MTG)
By Zacks Investment Research   |  Sep 16, 2019 11:04PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

MGIC Investment (NYSE:MTG) is well-poised for growth based on sizable mortgage insurance in force, declining delinquency, lower levels of paid claims and solid capital position. Long-term earnings growth is pegged at 5%.

Its return on equity was 17.6% in the trailing 12-month period, higher than the industry average of 8.1%. Return on equity is a profitability measure that identifies a company’s efficiency in utilizing its shareholders’ funds. The company has seen its estimates for 2019 move up 2.4% in the past 60 days, indicating investor optimism on the stock.

The company has an impressive VGM Score of B. This style score helps to find the most attractive value, best growth, and most promising momentum stock.

Shares of MGIC Investment have rallied 24.5% year to date compared with the industry’s increase of 10.5% and the Zacks S&P 500 composite’s rise of 18.6%.


The company had $217.1 billion mortgage insurance in force, the main catalyst of long-term earnings growth, as of Aug 31, 2019. Given solid persistency and an increase in new mortgage insurance business, insurance in force should continue to increase. For 2019, MGIC Investment projects solid writings, given strong purchase market and potential share gain from Federal Housing Administration.

MGIC Investment has been witnessing decline in claim payments, banking on improving housing market and improved credit quality. The company recently reported that its MGIC Investment August primary delinquent inventory declined 10.3% year over year. This, in turn, has strengthened the company’s balance sheet and improved its financial profile.

Capital contribution, reinsurance transaction and improving leverage ratio are also contributing to the strength of its balance sheet. This Zacks Rank #3 (Hold) mortgage insurer has a $200 million buyback authorization, which was approved by the board in March 2019.

The company has a solid earnings surprise history, as it beat estimates in the last four quarters with the average being 17.39%.

Stocks to Consider

Some better-ranked multiline insurance stocks include Assurant (NYSE:AIZ) , Radian Group (NYSE:RDN) and MetLife (NYSE:MET) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Assurant provides risk management solutions for housing and lifestyle markets in North America, Latin America, Europe, and the Asia Pacific. The company delivered positive surprise of 9.86% in the last reported quarter.

Radian Group engages in the mortgage and real estate services business in the United States. The company delivered positive surprise of 14.29% in the last reported quarter.

Cigna (NYSE:CI) provides insurance and related products and services in the United States and internationally. The company delivered positive surprise of 15.28% in the last reported quarter.

5 Stocks Set to Double

Zacks experts released their picks to gain +100% or more in 2020. One is a famous cutting-edge food company that is “hiding in plain sight.” Swamped with competitors and ignored by Wall Street, its stock price floundered. Now, suddenly, it acquired a company that gives it an advantage none of its peers have.

Today, see all 5 stocks with extreme growth potential >>



Radian Group Inc. (RDN): Free Stock Analysis Report

MetLife, Inc. (MET): Free Stock Analysis Report

Assurant, Inc. (AIZ): Free Stock Analysis Report

MGIC Investment Corporation (MTG): Free Stock Analysis Report

Original post

Zacks Investment Research
Here's Why Hold Strategy Is Apt For MGIC Investment (MTG)
 
Here's Why Hold Strategy Is Apt For MGIC Investment (MTG)

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email