MGIC Investment (MTG) Gets a Buy Rating from B.Riley FBR

B.Riley FBR analyst Randy Binner reiterated a Buy rating on MGIC Investment (NYSE: MTG) yesterday and set a price target of $16. The company’s shares opened today at $12.95.

Binner wrote:

“MTG reported 3Q18 operating EPS of $0.49, ahead of our and consensus’ estimate of $0.36. The beat, versus our model, came primarily from the loss ratio: -0.6%, versus our 15% estimate. Losses included a ~$60M reserve release compared to ~$40M in 3Q17. Net premiums earned were $250M, a beat versus our $226M estimate. New insurance written of $14.5B was in-line with our expectation. The premium yield was above plan, at 49 bps versus our 45 bps. Expenses came in favorable at 18.7% compared to our 21.0% estimate. MTG also announced that they have increased its upstream dividend from $50M to $60M in 3Q18. Overall, we view this as a favorable result for MTG and expect this trend to continue to the other PMIs.”

According to TipRanks.com, Binner is a 5-star analyst with an average return of 14.9% and a 68.8% success rate. Binner covers the Financial sector, focusing on stocks such as Health Insurance Innovations, Prudential Financial Inc, and Lincoln National Corp.

The word on The Street in general, suggests a Strong Buy analyst consensus rating for MGIC Investment with a $15.88 average price target, implying a 22.6% upside from current levels. In a report released today, KBW also maintained a Buy rating on the stock with a $16.50 price target.

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MGIC Investment’s market cap is currently $4.7B and has a P/E ratio of 10.31. The company has a Price to Book ratio of 1.42.

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MGIC Investment Corp. is a private mortgage insurer that serves lenders throughout the United States, and Puerto Rico. It also provides lenders with underwriting and other services and products related to home mortgage lending through its subsidiaries, such as Mortgage Guaranty Insurance Corp. and MGIC Indemnity Corp.