MGIC Investment Corporation (MTG) Bundle
A Brief History of MGIC Investment Corporation
MGIC Investment Corporation, founded in 1957, has established itself as a leading provider of private mortgage insurance in the United States. As of 2024, the company has continued to adapt to changing market conditions while maintaining a solid financial foundation.
Financial Performance Overview
For the third quarter of 2024, MGIC reported a net income of $200 million, or $0.77 per diluted share, compared to $182.8 million, or $0.64 per diluted share, for the same period in 2023. This represents a 9% increase in net income year-over-year.
For the nine months ended September 30, 2024, net income totaled $578.3 million, reflecting an increase from $528.4 million in 2023. The diluted income per share rose to $2.17, marking a 19% increase compared to $1.83 in the prior year.
| Metric | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Net Income | $200 million | $182.8 million | 9% |
| Diluted Income per Share | $0.77 | $0.64 | 20% |
| Adjusted Net Operating Income | $200.7 million | $183.0 million | 10% |
Investment Income and Losses
MGIC's net investment income for the third quarter of 2024 was $62.1 million, an increase from $55.4 million in the previous year. Losses incurred, net for the same period were ($9.8 million), a significant decrease compared to ($0.1 million) in Q3 2023, illustrating a favorable development of loss reserves.
Capital Management
As of September 30, 2024, MGIC held $6.0 billion in available assets under the PMIERs, exceeding its minimum required assets by $2.5 billion. The company is in compliance with the PMIERs, positioning it well to insure loans.
During the nine months ended September 30, 2024, MGIC repurchased 17.5 million shares of its common stock for $373.2 million. The remaining authorization for share repurchases is $651 million.
| Year | Shares Repurchased (millions) | Total Cost ($ million) |
|---|---|---|
| 2024 (to Sept 30) | 17.5 | 373.2 |
| 2023 | 21.7 | 340.6 |
Dividends to Shareholders
In 2024, MGIC paid a total of $97.5 million in dividends to shareholders. The quarterly cash dividends were $0.115 per share for the first two quarters and $0.13 per share for the third quarter.
| Quarter | Dividend per Share ($) | Total Dividend Paid ($ million) |
|---|---|---|
| Q1 2024 | 0.115 | 63.3 |
| Q2 2024 | 0.115 | 63.3 |
| Q3 2024 | 0.13 | 34.2 |
Market Position and Future Outlook
As of September 30, 2024, MGIC reported new insurance written (NIW) of $17.2 billion for the quarter and $39.8 billion for the nine months. The company anticipates a stable market position moving forward as it continues to navigate the evolving mortgage insurance landscape.
MGIC's annual persistency rate stood at 85.3% as of September 30, 2024, reflecting a slight decrease from previous periods. This metric is crucial for understanding the company's retention of existing business amid market fluctuations.
A Who Owns MGIC Investment Corporation (MTG)
Major Shareholders
As of September 30, 2024, the following table illustrates the ownership distribution among major shareholders of MGIC Investment Corporation (MTG):
| Shareholder | Ownership Percentage | Number of Shares Owned |
|---|---|---|
| BlackRock, Inc. | 13.5% | 34,650,000 |
| The Vanguard Group, Inc. | 10.2% | 26,400,000 |
| State Street Corporation | 8.5% | 21,600,000 |
| Wellington Management Co. LLP | 5.8% | 14,800,000 |
| Invesco Ltd. | 4.6% | 11,800,000 |
| Other Institutional Investors | 30.0% | 77,000,000 |
| Retail Investors | 27.4% | 70,000,000 |
Stock Performance
As of September 30, 2024, MGIC Investment Corporation's stock performance is as follows:
- Current Stock Price: $28.50
- Market Capitalization: $7.3 billion
- 52-week Range: $22.00 - $30.00
- Dividend Yield: 1.8%
- Shares Outstanding: Approximately 256 million
Recent Financial Highlights
Key financial metrics for MGIC Investment Corporation for the nine months ended September 30, 2024:
| Metric | Q3 2024 Amount | Q3 2023 Amount |
|---|---|---|
| Net Income | $578.3 million | $528.4 million |
| Earnings Per Share (Diluted) | $2.17 | $1.83 |
| Net Premiums Earned | $729.5 million | $726.1 million |
| Investment Income, Net | $183.3 million | $156.9 million |
| Total Assets | $6.68 billion | $6.54 billion |
Share Repurchase and Dividend Policy
MGIC Investment Corporation's share repurchase and dividend activity for 2024 includes:
- Share Repurchases (YTD): 17.5 million shares for $373.2 million
- Dividends Paid: $97.5 million
- Quarterly Dividend Declared: $0.13 per share payable on November 21, 2024
Regulatory Considerations
MGIC's ability to pay dividends is regulated, with $64 million considered ordinary dividends without prior approval. In 2024, MGIC has paid $350 million in dividends to the holding company.
Conclusion on Ownership Dynamics
The ownership structure of MGIC Investment Corporation reflects a combination of institutional and retail investors, with significant stakes held by major asset management firms. The firm's strong financial performance and commitment to returning capital to shareholders through dividends and share repurchases indicate a robust operational framework.
MGIC Investment Corporation (MTG) Mission Statement
Overview of MGIC's Mission
MGIC Investment Corporation is dedicated to providing high-quality mortgage insurance and risk management solutions, aiming to enhance homeownership opportunities. The company's mission emphasizes the importance of supporting sustainable homeownership through its insurance products and services.
Core Values
- Integrity: Upholding the highest ethical standards in all business dealings.
- Customer Focus: Committed to understanding and meeting the needs of customers.
- Innovation: Continuously improving and adapting products to better serve the changing market.
- Collaboration: Working together with partners to foster a healthy housing market.
Financial Performance
As of September 30, 2024, MGIC reported robust financial results that reflect its commitment to its mission. Key financial metrics include:
| Financial Metric | 2024 (YTD) | 2023 (YTD) | Change |
|---|---|---|---|
| Net Income | $578.3 million | $528.4 million | +9.4% |
| Net Income per Diluted Share | $2.17 | $1.83 | +18.6% |
| Adjusted Net Operating Income | $584.0 million | $536.8 million | +8.8% |
| Net Investment Income | $183.3 million | $156.9 million | +16.8% |
| Losses Incurred, Net | ($23.6 million) | ($11.3 million) | +108.8% |
Market Position
MGIC's market position is strengthened by its adherence to the PMIERs (Private Mortgage Insurer Eligibility Requirements). As of September 30, 2024, MGIC's Available Assets totaled approximately $6.0 billion, exceeding its Minimum Required Assets by $2.5 billion, ensuring compliance and eligibility to insure loans purchased by GSEs (Government-Sponsored Enterprises).
Shareholder Returns
In 2024, MGIC demonstrated its commitment to returning value to shareholders through dividends and share repurchase programs:
| Action | Amount | Details |
|---|---|---|
| Dividends Paid | $97.5 million | Paid to shareholders YTD September 30, 2024 |
| Quarterly Dividend per Share | $0.13 | Declared on October 24, 2024 |
| Share Repurchases | $373.2 million | 17.5 million shares repurchased YTD September 30, 2024 |
Future Outlook
Looking ahead, MGIC remains focused on enhancing its service offerings and maintaining financial strength. The company expects its Net Insurance Written (NIW) to slightly increase in 2024, continuing to adapt to market conditions and customer needs.
Conclusion
Through its mission and operational strategies, MGIC Investment Corporation seeks to foster sustainable homeownership, ensuring that its financial health contributes positively to the housing market.
How MGIC Investment Corporation (MTG) Works
Company Overview
MGIC Investment Corporation, a leading provider of private mortgage insurance (PMI), operates primarily through its subsidiary, Mortgage Guaranty Insurance Corporation (MGIC). The company insures residential mortgage loans, enabling lenders to offer loans to borrowers who may not meet the standard down payment requirements.
Financial Performance
As of September 30, 2024, MGIC reported significant financial results:
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Income (in millions) | $200.0 | $182.8 | 9% |
| Diluted Earnings per Share | $0.77 | $0.64 | 20% |
| Adjusted Net Operating Income (in millions) | $583.9 | $536.8 | 9% |
| Net Premiums Earned (in millions) | $243.3 | $241.3 | 1% |
| Net Investment Income (in millions) | $62.1 | $55.4 | 12% |
| Losses Incurred, Net (in millions) | ($9.8) | ($0.1) | N/M |
Insurance Operations
MGIC provides mortgage insurance on residential loans, facilitating home ownership for borrowers with lower equity. The company assesses risks based on a variety of factors, including the borrower's credit profile and the loan-to-value (LTV) ratio.
The company's new insurance written (NIW) for the third quarter of 2024 was $17.2 billion, compared to $14.6 billion in the same period last year. For the nine months ended September 30, 2024, NIW totaled $39.8 billion, up from $35.2 billion in 2023.
Delinquency Management
As of September 30, 2024, MGIC reported the following delinquency metrics:
| Delinquency Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Delinquency Inventory at Beginning of Period | 23,370 | 23,823 |
| New Notices | 13,679 | 12,240 |
| Cures | (11,591) | (10,975) |
| Delinquency Inventory at End of Period | 25,089 | 24,720 |
Investment Portfolio
MGIC's investment portfolio was valued at approximately $6.0 billion as of September 30, 2024, reflecting a slight increase from $5.7 billion on December 31, 2023. The portfolio's average duration and investment yield as of September 30, 2024, are indicative of its risk management strategies.
| Investment Metrics | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Investments (in millions) | $5,980 | $5,739 |
| Cash and Cash Equivalents (in millions) | $288.6 | $363.7 |
| Accrued Investment Income (in millions) | $59.4 | $58.8 |
Shareholder Activities
In the nine months ended September 30, 2024, MGIC repurchased 17.5 million shares for $373.2 million. As of the same date, the company had $651 million of remaining authorization for share repurchases under a $750 million program approved in April 2024.
The company also declared a quarterly cash dividend of $0.13 per share on October 24, 2024, payable to shareholders of record on November 7, 2024.
| Dividend Payments | Q1 2024 | Q2 2024 | Q3 2024 |
|---|---|---|---|
| Cash Dividends Paid (in millions) | $63.3 | $63.3 | $34.2 |
Regulatory Compliance
As of September 30, 2024, MGIC's available assets totaled $6.0 billion, exceeding its minimum required assets by approximately $2.5 billion, ensuring compliance with the GSEs' PMIERs.
The company continues to manage its capital adequacy and risk-to-capital ratios effectively, maintaining eligibility to insure loans delivered to or purchased by GSEs.
Conclusion
MGIC Investment Corporation's financial performance and operational strategies reflect a robust approach to mortgage insurance, with a focus on managing risk and maximizing shareholder value.
How MGIC Investment Corporation (MTG) Makes Money
Revenue Sources
MGIC Investment Corporation primarily generates revenue through the following channels:
- Net Premiums Earned: For the nine months ended September 30, 2024, net premiums earned amounted to $729.5 million, a slight increase from $726.1 million in the same period of the previous year.
- Investment Income: Net investment income for the nine months ended September 30, 2024, was $183.3 million, compared to $156.9 million for the same period in 2023.
- Other Revenue: Other revenue totaled $1.7 million for the nine months ended September 30, 2024, up from $1.5 million in 2023.
| Revenue Source | Q3 2024 (in thousands) | Q3 2023 (in thousands) | Change (%) |
|---|---|---|---|
| Net Premiums Earned | $243,340 | $241,277 | 1% |
| Investment Income, Net of Expenses | $62,093 | $55,375 | 12% |
| Other Revenue | $633 | $548 | 16% |
| Total Revenues | $306,649 | $296,505 | 3% |
Mortgage Insurance Operations
MGIC primarily operates in the mortgage insurance sector, which involves providing insurance on residential mortgage loans. The new insurance written (NIW) for the third quarter of 2024 was $17.2 billion, up from $14.6 billion in Q3 2023. For the nine months ended September 30, 2024, NIW reached $39.8 billion, compared to $35.2 billion in the same period of 2023.
| Insurance Metrics | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| New Insurance Written (NIW) | $17.2 billion | $14.6 billion | $39.8 billion | $35.2 billion |
Losses Incurred and Reserves
For the nine months ended September 30, 2024, losses incurred were ($23.6 million), compared to ($11.3 million) for the same period in 2023. New delinquency notices added approximately $158.3 million in 2024, while favorable development from re-estimating loss reserves was about $181.9 million.
| Loss Metrics | Q3 2024 (in thousands) | Q3 2023 (in thousands) | YTD 2024 (in thousands) | YTD 2023 (in thousands) |
|---|---|---|---|---|
| Losses Incurred, Net | ($9,842) | ($77) | ($23,559) | ($11,322) |
| New Delinquency Notices | $55,764 | $48,061 | $158,317 | $137,626 |
| Favorable Development | $65,606 | $48,238 | $181,876 | $148,948 |
Expenses and Underwriting
Underwriting and other expenses for the nine months ended September 30, 2024, totaled $162.7 million, down from $174.2 million in the previous year. The decrease was primarily due to lower pension expenses and professional service fees.
| Expense Metrics | Q3 2024 (in thousands) | Q3 2023 (in thousands) | YTD 2024 (in thousands) | YTD 2023 (in thousands) |
|---|---|---|---|---|
| Underwriting and Other Expenses | $50,967 | $50,130 | $162,660 | $174,191 |
| Amortization of Deferred Policy Acquisition Costs | $2,323 | $2,802 | $6,482 | $7,889 |
Tax Provision and Net Income
For the nine months ended September 30, 2024, MGIC reported a net income of $578.3 million, or $2.17 per diluted share, an increase from $528.4 million, or $1.83 per diluted share in 2023.
| Net Income Metrics | Q3 2024 (in thousands) | Q3 2023 (in thousands) | YTD 2024 (in thousands) | YTD 2023 (in thousands) |
|---|---|---|---|---|
| Net Income | $199,969 | $182,844 | $578,294 | $528,445 |
| Provision for Income Taxes | $54,327 | $51,552 | $155,707 | $143,937 |
| Earnings Per Share (Diluted) | $0.77 | $0.64 | $2.17 | $1.83 |
Capital Management
As of September 30, 2024, MGIC reported total shareholders' equity of $5.3 billion, reflecting an increase from $4.9 billion at the end of 2023. The company successfully maintained compliance with PMIERs, with available assets totaling $6.0 billion, which is $2.5 billion above the minimum required assets.
| Capital Metrics | September 30, 2024 (in thousands) | December 31, 2023 (in thousands) | Change (%) |
|---|---|---|---|
| Total Shareholders' Equity | $5,294,076 | $4,854,705 | 9% |
| Available Assets | $6,000,000 | N/A | N/A |
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Updated on 16 Nov 2024
Resources:
- MGIC Investment Corporation (MTG) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of MGIC Investment Corporation (MTG)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View MGIC Investment Corporation (MTG)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.