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.
Why Should You Stay Invested in NMI Holdings (NMIH) Stock Now?
Read MoreHide Full Article
NMI Holdings’ (NMIH - Free Report) improving mortgage insurance portfolio, higher new insurance written volume, a comprehensive reinsurance program, solid capital position, effective capital deployment along with favorable growth estimates make it worth retaining in one’s portfolio.
NMIH has a solid track record of beating earnings estimates in the last 19 quarters. It has a VGM Score of A.
Zacks Rank & Price Performance
NMI Holdings currently carries a Zacks Rank #3 (Hold). Year to date, the stock has lost 14.9% against the industry’s increase of 4.4%.
Image Source: Zacks Investment Research
Growth Projections
The Zacks Consensus Estimate for NMI Holdings’ 2022 earnings is pegged at $3.20, indicating a 17.2% increase from the year-ago reported figure on 9.1% higher revenues of $529.2 million. The consensus estimate for 2023 earnings is pegged at $3.67, indicating a 14.5% increase from the year-ago reported figure on 7.4% higher revenues of $568.4 million.
Growth in monthly and single premium policy production tied to the increased penetration of existing customer accounts and new customer account activations as well as growth in the size of the total mortgage insurance market makes NMI Holdings well poised for growth. The mortgage insurer noted that increasing interest rates would impact refinancing activity but purchase origination volume should remain strong.
A strong mortgage origination market and increased private mortgage insurance penetration rates should benefit NMIH. The insurer anticipates the housing market to remain strong with continued demand, appreciation in house price, favorable mortgage insurance market, better pricing and solid new insurance written volume.
The insurer noted that new business opportunity has been fueling Private MI Industry IIF growth. Total Private MI industry IIF is estimated to grow to $2 trillion by 2024. NIW is expected to grow $500-600 billion annually to $2.9 trillion by 2024, attributable to millennial demand, driven by increased access and affordability among others.
NMI Holdings has a comprehensive reinsurance program in place for the entirety of the in-force portfolio. This, in turn, enhances its return profile, absorbs loss, provides efficient growth capital and mitigates the impact of credit volatility.
The insurer remains focused on efficiency and expense management, driving improved margins.
Also, NMIH has a $125 million worth share buyback program, effective through Dec 31, 2023 under its kitty.
All these together should help the insurer continue to generate solid mid-teens shareholders’ returns.
American Financial’s earnings surpassed estimates in each of the last four quarters, the average beat being 41.72%. In the past year, American Financial has rallied 3.5%.
The Zacks Consensus Estimate for AFG’s 2022 and 2023 earnings has moved 9.8% and 6.9% north, respectively, in the past 30 days.
W.R. Berkley’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 27.76%. In the past year, W.R. Berkley's stock has surged 38.7%.
The Zacks Consensus Estimate for WRB’s 2022 and 2023 earnings has moved 6.3% and 6.2% north, respectively, in the past 60 days.
The Zacks Consensus Estimate for HCI Group’s 2022 and 2023 earnings has moved 33.3% and 40% north, respectively, in the past 30 days. In the past year, HCI Group stock has lost 18%.
The Zacks Consensus Estimate for 2022 and 2023 earnings per share indicates year-over-year increases of 700% and 75%, respectively.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Why Should You Stay Invested in NMI Holdings (NMIH) Stock Now?
NMI Holdings’ (NMIH - Free Report) improving mortgage insurance portfolio, higher new insurance written volume, a comprehensive reinsurance program, solid capital position, effective capital deployment along with favorable growth estimates make it worth retaining in one’s portfolio.
NMIH has a solid track record of beating earnings estimates in the last 19 quarters. It has a VGM Score of A.
Zacks Rank & Price Performance
NMI Holdings currently carries a Zacks Rank #3 (Hold). Year to date, the stock has lost 14.9% against the industry’s increase of 4.4%.
Image Source: Zacks Investment Research
Growth Projections
The Zacks Consensus Estimate for NMI Holdings’ 2022 earnings is pegged at $3.20, indicating a 17.2% increase from the year-ago reported figure on 9.1% higher revenues of $529.2 million. The consensus estimate for 2023 earnings is pegged at $3.67, indicating a 14.5% increase from the year-ago reported figure on 7.4% higher revenues of $568.4 million.
It has a Growth Score of B.
Return on Equity
Return on equity was 16.5% in the trailing twelve months, better than the industry average of 5.7%.
Business Tailwinds
NMI Holdings superior primary insurance in-force (IIF) portfolio generates industry-leading growth.
Growth in monthly and single premium policy production tied to the increased penetration of existing customer accounts and new customer account activations as well as growth in the size of the total mortgage insurance market makes NMI Holdings well poised for growth. The mortgage insurer noted that increasing interest rates would impact refinancing activity but purchase origination volume should remain strong.
A strong mortgage origination market and increased private mortgage insurance penetration rates should benefit NMIH. The insurer anticipates the housing market to remain strong with continued demand, appreciation in house price, favorable mortgage insurance market, better pricing and solid new insurance written volume.
The insurer noted that new business opportunity has been fueling Private MI Industry IIF growth. Total Private MI industry IIF is estimated to grow to $2 trillion by 2024. NIW is expected to grow $500-600 billion annually to $2.9 trillion by 2024, attributable to millennial demand, driven by increased access and affordability among others.
NMI Holdings has a comprehensive reinsurance program in place for the entirety of the in-force portfolio. This, in turn, enhances its return profile, absorbs loss, provides efficient growth capital and mitigates the impact of credit volatility.
The insurer remains focused on efficiency and expense management, driving improved margins.
Also, NMIH has a $125 million worth share buyback program, effective through Dec 31, 2023 under its kitty.
All these together should help the insurer continue to generate solid mid-teens shareholders’ returns.
Stocks to Consider
Some better-ranked stocks from the insurance industry are American Financial Group, Inc. (AFG - Free Report) , W.R. Berkley Corporation (WRB - Free Report) and HCI Group, Inc. (HCI - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
American Financial’s earnings surpassed estimates in each of the last four quarters, the average beat being 41.72%. In the past year, American Financial has rallied 3.5%.
The Zacks Consensus Estimate for AFG’s 2022 and 2023 earnings has moved 9.8% and 6.9% north, respectively, in the past 30 days.
W.R. Berkley’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 27.76%. In the past year, W.R. Berkley's stock has surged 38.7%.
The Zacks Consensus Estimate for WRB’s 2022 and 2023 earnings has moved 6.3% and 6.2% north, respectively, in the past 60 days.
The Zacks Consensus Estimate for HCI Group’s 2022 and 2023 earnings has moved 33.3% and 40% north, respectively, in the past 30 days. In the past year, HCI Group stock has lost 18%.
The Zacks Consensus Estimate for 2022 and 2023 earnings per share indicates year-over-year increases of 700% and 75%, respectively.