On July 31, 2024, MGIC Investment Corp (MTG, Financial) released its 8-K filing detailing the financial results for the second quarter of 2024. MGIC Investment Corp provides private mortgage insurance, other mortgage credit risk management solutions, and ancillary services. The company operates across all 50 states of the United States and in Puerto Rico, with significant exposure in states like California, Florida, and Texas.
Performance Overview
MGIC Investment Corp (MTG, Financial) reported a net income of $204.2 million or $0.77 per diluted share for Q2 2024, surpassing the analyst estimate of $0.62 per share. The adjusted net operating income was $204.9 million or $0.77 per diluted share, also exceeding expectations. The company's revenue for the quarter stood at $305.3 million, outperforming the estimated $301.03 million.
Key Financial Achievements
MGIC Investment Corp's financial achievements in Q2 2024 highlight its strong market position and effective risk management strategies. The company reported net premiums earned of $243.5 million, consistent with the previous quarter. Investment income increased to $61.5 million from $52.3 million in Q2 2023, reflecting a robust investment strategy.
Income Statement Highlights
| Metric | Q2 2024 | Q1 2024 | Q2 2023 |
|---|---|---|---|
| Net Income ($ millions) | 204.2 | 174.1 | 191.1 |
| Net Income per Diluted Share ($) | 0.77 | 0.64 | 0.66 |
| Adjusted Net Operating Income ($ millions) | 204.9 | 178.4 | 196.0 |
| Adjusted Net Operating Income per Diluted Share ($) | 0.77 | 0.65 | 0.68 |
| New Insurance Written (NIW) ($ billions) | 13.5 | 9.1 | 12.4 |
| Net Premiums Earned ($ millions) | 243.5 | 242.6 | 242.8 |
Balance Sheet and Cash Flow Highlights
MGIC Investment Corp reported a book value per common share of $19.58, up from $18.97 in Q1 2024. The company's tangible book value per share also increased to $20.85 from $20.18 in the previous quarter. The holding company liquidity stood at $990 million, reflecting a strong liquidity position.
Operational Highlights
During Q2 2024, MGIC Investment Corp paid a dividend of $0.115 per common share and repurchased 7.6 million shares of common stock using $157.0 million of holding company cash. Additionally, MGIC paid a $350 million dividend to the holding company. The company also executed a traditional excess of loss reinsurance transaction effective April 1, 2024, providing up to $187.2 million of reinsurance coverage on eligible NIW in 2024.
Commentary
"I am pleased to report we again delivered a solid quarter of financial results. We continue to benefit from favorable credit trends, a disciplined market approach, focus on through the cycle performance, and the strength of our business model. We remain committed to creating long-term value for all of our stakeholders." - Tim Mattke, CEO of MGIC Investment Corp.
Analysis
MGIC Investment Corp's strong financial performance in Q2 2024, marked by higher-than-expected earnings and revenue, underscores the company's effective risk management and strategic initiatives. The increase in net income and adjusted net operating income highlights the company's ability to navigate market dynamics and capitalize on favorable credit trends. The robust liquidity position and strategic share repurchases further strengthen the company's financial stability and shareholder value.
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Explore the complete 8-K earnings release (here) from MGIC Investment Corp for further details.
