Buy Radian And Its Peers, The Capital-Light Strategy Is Paying Benefits

Jan. 21, 2023 4:53 AM ETRadian Group Inc. (RDN)ESNT, MTG, NMIH6 Comments
Gary J. Gordon profile picture
Gary J. Gordon


  • Radian just issued a press release detailing substantial cash flow heading investors' way.
  • Radian's capital-light operating strategy is behind this press release.
  • Why I am confident that mortgage defaults will remain low even in the expected coming recession.
  • Radian and its peers sell at less than 40% of the market multiple despite their substantial cash flow capacity.

Balancing home and savings

PM Images

Radian's January 18th big news

I'll quote from its press release, then put in my two cents:

"Radian Guaranty has not paid an ordinary dividend to Radian Group since the start of the financial crisis in 2007, due

Housing vacancy rates

The Census Bureau

Mortgage lending standard index

Mortgage Bankers Association

Mortgage payments as a % of household income

Federal Reserve

Number of job openings (JOLT survey)


This article was written by

Gary J. Gordon profile picture
Gary Gordon’s career was on Wall Street, where he was a stock analyst covering the housing, mortgage and consumer finance industries. He also served as a U.S. investment strategist and as a portfolio manager. The bulk of his work career was at PaineWebber and UBS. He is now retired. Mr. Gordon is an adjunct professor at Mercy College in New York. He teaches economics on campus and math at prisons (Sing Sing and Taconic in New York). He also presents financial literacy seminars to adults and students. He is on the Board of Hudson Link (college education for incarcerated men and women) and the Baron de Hirsch Fund. Mr. Gordon is married with two young adult children. He has degrees from Colgate University (BA '74, philosophy) and The Wharton School (MBA '77, finance).

Disclosure: I/we have a beneficial long position in the shares of RDN MTG NMIH ESNT either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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