- A loud profit number thanks to the DTA reversal and a big jump in new insurance written make for good headlines from MGIC Investment's (MTG +3.4%) earnings results this morning, says BTIG's Mark Palmer, but both had been expected.
- The real story, he says, is the continuation in credit improvement - a 15.1% sequential decrease in losses to $76.5M, and a 19 basis point drop in the delinquency rate to 5.29%.
- Over time, the next catalyst will be NIW growth as Uncle Sam cedes more of the mortgage insurance market to private insurers.
- He reiterates his Buy rating, with $12 price target 20% above the current level.
- Up in concert with MGIC is Radian (RDN +1%).
- Previously: MGIC Investment up big after strong quarter (Oct. 15)
- Previously: MGIC Investment beats by $0.08, beats on revenue (Oct. 15)
MGIC bull: Credit improvement is the story
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MTG | - | - |
MGIC Investment Corporation |