Radian Group Inc. RDN reported fourth-quarter 2024 adjusted operating income of $1.09 per share, which beat the Zacks Consensus Estimate by 14.7%. The bottom line increased 13.5% year over year.
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The results reflected higher premium, improved investment income, higher revenues across both the Mortgage and All Other segments as well as lower higher expenses.
Radian Group Inc. Price, Consensus and EPS Surprise
Radian Group Inc. Price, Consensus and EPS Surprise
Radian Group Inc. price-consensus-eps-surprise-chart | Radian Group Inc. Quote
Quarter in Detail
Operating revenues decreased 4% year over year to $316 million due to lower services revenues.
Net premiums earned were $238.5 million, which increased 2.5% year over year. Net investment income jumped 3.6% year over year to $71.3 million.
MI New Insurance Written increased 24% year over year to $13.2 billion.
Primary mortgage insurance in force increased 2% year over year to an all-time high of $275.1 billion as of Dec. 31, 2024.
Persistency — the percentage of mortgage insurance in force that remains in the company’s books after a 12-month period — was 84% as of Dec. 31, 2024, which remained unchanged year over year.
Primary delinquent loans were 24,055 as of Dec. 31, 2024, up 9.2% year over year.
Total expenses decreased 14.8% year over year to $126.7 million on account of lower other operating expenses and interest expense.
The expense ratio was 24.2, which improved 130 bps from the year-ago quarter.
Segmental Update
The Mortgage segment’s total revenues of $288.7 million increased 2.1% year over year. Net premiums earned by the segment were $235.2 million, up 2.1% year over year. Claims paid were $5 million, which increased 66.7% year over year. The loss ratio was 0% compared with 2% in the year-ago quarter.
The All Other segment’s revenues of $33.9 million increased 3.8% year over year. Net premiums earned by the segment were $3.3 million, which increased 44.8% year over year. Adjusted pre-tax operating loss was $6.3 million, slightly wider than the prior-year quarter’s loss of $6 million.
Full-Year Highlights
Adjusted operating income of $4.11 per share beat the Zacks Consensus Estimate by 2.7%. The bottom line increased 6% year over year.
Total revenues came in at $1.2 billion, up 4% year over year.
New insurance written of $51.9 billion declined 1.3% from 2023.
The loss ratio was negative 0.2 compared with negative 4.6 in 2023, while the expense ratio was 25.3, which improved from 70 bps in 2022.
Financial Update
As of Dec. 31, 2024, Radian Group had a solid cash balance of $38.8 million, which doubled from the 2023-end level.
The debt-to-capital ratio improved 570 bps to 18.7 from the 2024-end level. Book value per share, a measure of net worth, climbed 9.1% year over year to $31.33 as of Dec. 31, 2024.
In the fourth quarter, the adjusted net operating return on equity was 14.2%, which remains unchanged year over year.
As of Dec. 31, 2024, Radian Guaranty’s Available Assets under PMIERs totaled approximately $6 billion, resulting in PMIERs excess Available Assets of $2.2 billion.
Share Repurchase and Dividend Update
During the fourth quarter of 2024, Radian bought back 2.2 million shares worth $75 million. As of Dec. 31, 2024, purchase authority of up to $543 million remained available under the existing program. The board of directors paid a quarterly dividend of 24.5 cents per share in the fourth quarter of 2024.
Zacks Rank
Radian Group currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Multi-Line Insurers
The Hartford Financial Services Group, Inc. HIG reported fourth-quarter 2024 adjusted operating earnings of $2.94 per share, which beat the Zacks Consensus Estimate by 10.1%. However, the bottom line decreased 3.9% year over year. HIG's operating revenues amounted to $4.8 billion, which improved 11.1% year over year in the quarter under review. The top line beat the consensus mark by a whisker. Earned premiums of Hartford Financial rose 6.9% year over year to $5.8 billion in the fourth quarter but missed the Zacks Consensus Estimate by 0.7%. The metric was driven by a 9.6% and 0.6% year-over-year rise in P&C and Group Benefits’ earned premiums, respectively.
Pre-tax net investment income of $714 million grew 9.3% year over year and beat the consensus mark by 5.5%. Net investment income witnessed year-over-year growth in both the Property and Casualty and Group Benefits segments. Total benefits, losses and expenses increased 6.5% year over year to $5.8 billion in the quarter under review.
Everest Group, Ltd. EG reported fourth-quarter 2024 operating loss of $18.39 per share, wider than the Zacks Consensus Estimate of a loss of $16.65. EG had reported an operating income of $25.18 per share in the year-ago quarter. Everest Group’s total operating revenues of nearly $4.64 billion increased 26.7% year over year on higher premiums earned and net investment income. The top line beat the consensus mark by 4.4%. Gross written premiums improved 8% year over year to $4.7 billion. Our estimate was $5.1 billion.
Net investment income was $473 million, which increased 15.1% year over year. The upside was driven by a larger asset base as well as strong core fixed income investment returns. Our estimate was $419.5 million. The Zacks Consensus Estimate was pegged at $496 million. Total claims and expenses surged 59% to $5.4 billion.
MGIC Investment Corporation MTG reported fourth-quarter 2024 operating net income per share of 72 cents, which beat the Zacks Consensus Estimate by 10.8%. Moreover, the bottom line increased 10.2% year over year. MGIC Investment recorded total operating revenues of $303.1 million, which increased 6.4% year over year. The top line however missed the consensus mark by 1.1%. Insurance in force increased 0.6% from the prior-year quarter to $295.4 billion. The Zacks Consensus Estimate was $294 billion. Our estimate was $293.6 billion.
The insurer witnessed a 4.4% increase in primary delinquency to 26,791 loans. Net premiums written increased 5.9% year over year to $232.1 million. The figure was higher than our estimate of $231.1 million. Net investment income increased 6.1% year over year to $61.3 million. Our estimate was $66.9 million. The Zacks Consensus Estimate was pegged at $65 million. Persistency — the percentage of insurance remaining in force from one year prior — was 84.8% as of Dec. 30, 2024, down from 86.1% in the year-ago quarter.
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