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NMI Holdings (NMIH) Q2 Earnings Beat, Revenues Rise Y/Y

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NMI Holdings (NMIH - Free Report) reported second-quarter 2020 operating net income per share of 40 cents, which beat the Zacks Consensus Estimate by 25%. The bottom line declined 32.2% year over year.

The quarterly results reflect the impact of additional claims and claim expenses incurred on higher default experience in connection with the COVID-19 pandemic.

Operational Update

NMI Holdings recorded total operating revenues of $107 million, which increased 17.5% year over year on higher net premiums earned (up 18.9%) and other revenues (up nearly six fold). Revenues beat the Zacks Consensus Estimate by 0.8%.

Net investment income dropped 7.3% year over year to $7 million.

Primary insurance-in-force increased 21% to $98.9 billion.

New insurance written was $13.1 billion, up 8% year over year.

Net underwriting and operating expenses totaled $30.4 million, down 5.6% year over year. Insurance claims and claim expenses were $34.3 million, marking a nearly 12-fold increase and reflecting higher default experience attributable to the COVID-19 pandemic

Loss ratio was 34.7%, which deteriorated 3120 basis points year over year.

NMI Holdings Inc Price, Consensus and EPS Surprise

NMI Holdings Inc Price, Consensus and EPS Surprise

NMI Holdings Inc price-consensus-eps-surprise-chart | NMI Holdings Inc Quote

Financial Update

Book value per share, a measure of net worth, grew about 24% to $14.82 as of Jun 30, 2020 from year ago quarter end.

NMI Holdings had $1.9 billion in cash and investments, up 76% year over year.

Annualized adjusted return on equity was 10.7%

Total PMIERs available assets were $1.7 billion and net risk-based required assets totaled $1.0 billion at quarter end

Zacks Rank

NMI Holdings 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 P&C Insurers

Of the insurance industry players that have reported second-quarter results so far, The Progressive Corporation (PGR - Free Report) , Cincinnati Financial (CINF - Free Report) and RLI Corp. (RLI - Free Report) beat the respective Zacks Consensus Estimate for earnings.

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