We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
NMI Holdings (NMIH) Continues to Gain From Solid Premiums
Read MoreHide Full Article
NMI Holdings Inc. (NMIH - Free Report) has been in investors’ good books, owing to growth in monthly and single premium policy production, growth in total investment portfolio and flexible liquidity.
Growth Projections
The Zacks Consensus Estimate for 2021 and 2022 earnings per share is pegged at $2.55 and $3.22, indicating year-over-year increase of 16.4% and 26.4%, respectively.
Estimate Revision
The Zacks Consensus Estimate for 2021 and 2022 has moved 7.1% and 7.7% north, respectively in the past 60 days. This should instill investors' confidence in the stock.
Earnings Surprise History
NMI Holdings has a decent earnings surprise history. It beat estimates in each of the last four quarters, with the average being 19.38%.
Zacks Rank & Price Performance
NMI Holdings currently carries a Zacks Rank #2 (Buy). In the past year, the stock has rallied 40.8% compared with the industry’s increase of 39.6%.
Image Source: Zacks Investment Research
Style Score
It has an impressive Value Score of B, which reflects an attractive valuation of the stock. Back-tested results show that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2 offer the best investment opportunities.
Return on Equity (ROE)
The company’s ROE for the trailing 12 months is 13.1%, better than the industry average of 5.6%, reflecting the company’s efficiency in utilizing shareholders’ fund.
Business Tailwinds
The mortgage insurer should continue to benefit from growth in monthly and single premium policy production tied to growth in the size of the total mortgage insurance market, as well as the increased penetration of existing customer accounts and new customer account activations, which contribute to new insurance written (NIW) growth.
Considering the growth in the size of total investment portfolio, investment income is expected to improve amid the current low interest rate environment. The metric witnessed a four-year CAGR (2016-2020) of 23.4%.
Such premium growth as well as improving investment income is driving the top line, which witnessed a four-year CAGR (2016-2020) of 36.8%. The Zacks Consensus Estimate for the company’s 2021 and 2022 revenues is pegged at $483.4 million and $549.3 million, indicating year-over-year increase of 11.5% and 13.6%, respectively.
NMI Holdings has a comprehensive reinsurance program, which enhances its return profile, absorbs loss, provides efficient growth capital and mitigates impact of credit volatility. It extended its reinsurance coverage across most recent production. In April, NMIC entered into a reinsurance agreement with (Oaktown Re VI) that provides for up to $367.2 million of aggregate excess-of-loss reinsurance coverage on risk that are originated primarily written between Oct 1, 2020 and Mar 31, 2021.
NMI Holdings boasts a strong balance sheet with significant financial flexibility. It has $400 million of outstanding senior notes, and also has access to $110 million of undrawn revolving credit facility (through the 2020 Revolving Credit Facility).
The bottom line of HCI Group surpassed estimates in three of the last four quarters and missed the mark in the remaining one, the average beat being 42.91%.
Cincinnati Financial’s earnings surpassed estimates in three of the last four quarters, missing the mark on a single occasion, the average surprise being 17.63%.
Alleghany’s earnings surpassed estimates in each of the last four quarters, the average being 128.63%.
Time to Invest in Legal Marijuana
If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.
After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%
You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.
Image: Bigstock
NMI Holdings (NMIH) Continues to Gain From Solid Premiums
NMI Holdings Inc. (NMIH - Free Report) has been in investors’ good books, owing to growth in monthly and single premium policy production, growth in total investment portfolio and flexible liquidity.
Growth Projections
The Zacks Consensus Estimate for 2021 and 2022 earnings per share is pegged at $2.55 and $3.22, indicating year-over-year increase of 16.4% and 26.4%, respectively.
Estimate Revision
The Zacks Consensus Estimate for 2021 and 2022 has moved 7.1% and 7.7% north, respectively in the past 60 days. This should instill investors' confidence in the stock.
Earnings Surprise History
NMI Holdings has a decent earnings surprise history. It beat estimates in each of the last four quarters, with the average being 19.38%.
Zacks Rank & Price Performance
NMI Holdings currently carries a Zacks Rank #2 (Buy). In the past year, the stock has rallied 40.8% compared with the industry’s increase of 39.6%.
Style Score
It has an impressive Value Score of B, which reflects an attractive valuation of the stock. Back-tested results show that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2 offer the best investment opportunities.
Return on Equity (ROE)
The company’s ROE for the trailing 12 months is 13.1%, better than the industry average of 5.6%, reflecting the company’s efficiency in utilizing shareholders’ fund.
Business Tailwinds
The mortgage insurer should continue to benefit from growth in monthly and single premium policy production tied to growth in the size of the total mortgage insurance market, as well as the increased penetration of existing customer accounts and new customer account activations, which contribute to new insurance written (NIW) growth.
Considering the growth in the size of total investment portfolio, investment income is expected to improve amid the current low interest rate environment. The metric witnessed a four-year CAGR (2016-2020) of 23.4%.
Such premium growth as well as improving investment income is driving the top line, which witnessed a four-year CAGR (2016-2020) of 36.8%. The Zacks Consensus Estimate for the company’s 2021 and 2022 revenues is pegged at $483.4 million and $549.3 million, indicating year-over-year increase of 11.5% and 13.6%, respectively.
NMI Holdings has a comprehensive reinsurance program, which enhances its return profile, absorbs loss, provides efficient growth capital and mitigates impact of credit volatility. It extended its reinsurance coverage across most recent production. In April, NMIC entered into a reinsurance agreement with (Oaktown Re VI) that provides for up to $367.2 million of aggregate excess-of-loss reinsurance coverage on risk that are originated primarily written between Oct 1, 2020 and Mar 31, 2021.
NMI Holdings boasts a strong balance sheet with significant financial flexibility. It has $400 million of outstanding senior notes, and also has access to $110 million of undrawn revolving credit facility (through the 2020 Revolving Credit Facility).
Other Stocks to Consider
Some other top-ranked stocks from the same space are HCI Group, Inc. (HCI - Free Report) , Cincinnati Financial Corporation (CINF - Free Report) and Alleghany Corporation , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The bottom line of HCI Group surpassed estimates in three of the last four quarters and missed the mark in the remaining one, the average beat being 42.91%.
Cincinnati Financial’s earnings surpassed estimates in three of the last four quarters, missing the mark on a single occasion, the average surprise being 17.63%.
Alleghany’s earnings surpassed estimates in each of the last four quarters, the average being 128.63%.
Time to Invest in Legal Marijuana
If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.
After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%
You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.
Today, Download Marijuana Moneymakers FREE >>