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MGIC Investment's (MTG) May Insurance in Force Impressive

Zacks Equity Research

MGIC Investment Corp. MTG recently announced its May 2019 operating business statistics. Insurance in force was $213.3 billion, up 7% year over year. Delinquency loans (loans that failed to pay back) at MGIC Investment declined on a year-over-year basis. Delinquent inventory decreased 20.2% year over year to 29,737.

New delinquency notices increased 4% year over year to 4,382 in the month.

Improving housing market fundamentals such as household formation and home sales and current capital status have been aiding the company’s performance over the past several quarters.

Strengthening purchase mortgage market and mortgage insurer’s solid market share (measured by new insurance written) have been driving new business written. MGIC Investment expects to have 19-20% of market share in the industry in which it operates. This company is one of the six private mortgage insurers operating in the competitive industry and currently holds 18% market share.

Given the strong purchase market and potential share gain from FHA, the company anticipates strong writing in 2019 on the back of new business and strong persistency. MGIC Investment is well poised to benefit from improving housing market fundamentals.

Also, decline in loss and claims will strengthen the company’s balance sheet and improve its financial profile.

Shares of MGIC Investment have rallied 34.8% year to date outperforming the industry’s increase of 11.1%. Improving housing market, solid insurance in force and fall in delinquency should help the stock retain the bull run.

MGIC Investment sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks to Consider

Investors interested in multiline industry can look at American International Group, Inc. AIG, MetLife, Inc. MET, and Radian Group, Inc. RDN.

AIG provides insurance products for commercial, institutional, and individual customers in North America and internationally. The company delivered positive surprise of 47.66% in the last reported quarter. The stock sports a Zacks Rank #1.

MetLife engages in the insurance, annuities, employee benefits, and asset management businesses. The company delivered positive surprise of 13.85% in the last reported quarter. The stock sports a Zacks Rank #2 (Buy).

Radian Group provides mortgage and real estate products and services in the United States. The company delivered positive surprise of 7.35% in the last reported quarter. The stock carries a Zacks Rank #2.

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Radian Group Inc. (RDN) : Free Stock Analysis Report
 
American International Group, Inc. (AIG) : Free Stock Analysis Report
 
MetLife, Inc. (MET) : Free Stock Analysis Report
 
MGIC Investment Corporation (MTG) : Free Stock Analysis Report
 
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Zacks Investment Research