Essent Group Ltd. (ESNT) on Q4 2023 Results - Earnings Call Transcript
Operator: Thank you for standing by. My name is Eric, and I will be your conference operator today. At this time, I would like to welcome everyone to the Essent Group Limited Fourth Quarter 2023 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. I would now like to turn the call over to Phil Stefano, Investor Relations. Please go ahead. Phil Stefano: Thank you, Eric. Good morning, everyone, and welcome to our call. Joining me today are Mark Casale, Chairman and CEO; and David Weinstock, Chief Financial Officer. Also on hand for the Q&A portion of the call is Chris Curran, President of Essent Guaranty. Our press release, which contains Essent’s financial results for the fourth quarter and full year 2023, was issued earlier today and is available on our website at essentgroup.com. Our press release includes non-GAAP financial measures that may be discussed during today’s call. A complete description of these measures and the reconciliation to GAAP may be found in Exhibit O of our press release. Prior to getting started, I would like to remind participants that today’s discussions are being recorded and will include the use of forward-looking statements. These statements are based on current expectations, estimates, projections and assumptions that are subject to risks and uncertainties, which may cause actual results to differ materially. For a discussion of these risks and uncertainties, please review the cautionary language regarding forward-looking statements in today’s press release, the risk factors included in our Form 10-K filed with the SEC on February 17, 2023, and any other reports and registration statements filed with the SEC, which are also available on our website. Now let me turn the call over to Mark. Mark Casale: Thanks, Phil, and good morning, everyone. Earlier today, we released our fourth quarter and full year 2023 financial results. Strong credit quality and resilience in the housing and labor markets continue to drive favorable credit performance, while higher interest rates drove investment income growth and elevated persistency during the year. Heading into 2024, we remain constructive on a long-term outlook for housing as the supply and demand imbalance and favorable demographic trends should provide foundational support to home prices. Even though sentiment has improved for a soft landing on the back of strong employment and consumer spending, we continue to manage our business for a range of economic scenarios. Given the strength of our balance sheet and our Buy, Manage and Distribute operating model, we believe Essent is well positioned. And now for our results. For the fourth quarter of 2023, we reported net income of $175 million, compared to $147 million a year ago. On a diluted per share basis, we earned $1.64 for the fourth quarter, compared to $1.37 a year ago. For the full year, we earned $696 million or $6.50 per diluted share, while our return on average equity was 15%. As of December 31st, our book value per share was $47.87, an increase of 16% from a year ago. As of December 31st, our mortgage -- U.S. Mortgage Insurance In-Force was $239 billion, a 5% increase versus a year ago. Our 12-month persistency on December 31st was 87%, and nearly 75% of our In-Force portfolio has a note rate of 5.5% or lower. Despite the recent shift lower in rates, we expect persistency will remain elevated in 2024. The credit quality of our Insurance In-Force remains strong, with a weighted average FICO of 746 and a weighted average original LTV of 93%. Regulatory guardrails implemented after the global financial crisis have significantly improved industry credit quality and performance, while embedded home equity in our insurance portfolio should mitigate potential claims. During 2023, in light of higher mortgage rates and lower mortgage origination volume, we continue to focus on supporting our customers while expanding our franchise. Despite the challenging environment, we successfully activated 108 new customers and continue to leverage EssentEDGE to optimize our unit economics and deliver our best rates to borrowers. Our Bermuda-based reinsurance entity, Essent Re, had another strong year of performance, writing high credit -- high-quality GSE risk share business and expanding its fee-based MGA services. Essent Re ended the year with annual third-party revenues of approximately $80 million, while our third-party Risk In-Force was $2.2 billion. Our title operations incurred a pre-tax loss of approximately $4 million in the fourth quarter, similar to last quarter. We remain focused on integrating title while implementing risk controls and improving operational efficiency. The Essent Ventures team continues to invest in funds, gaining insights to improve our core business while enhancing financial returns. As of December 31st, the carrying value of other invested assets is $277 million and ever to date these investments have created $74 million of value. Cash and investments as of December 31st were $5.7 billion and our new money yield in the fourth quarter remained over 5%. For the full year of 2023, our investment yield was 3.5%, compared to 2.6% in 2022. Net investment income was $186 million in 2023, up approximately 50% from 2022. New money yields in our investment portfolio continue to run ahead of our book yields, which should contribute to future revenue growth. As of December 31st, we are in a position of strength with $5.1 billion in GAAP equity, access to $1.4 billion in excess of loss reinsurance and over $1 billion of available holding company liquidity. With a full year 2023 operating cash flow of $763 million and a mortgage insurance underrating margin of 77%, our franchise remains well-positioned from an earnings, cash flow and balance sheet perspective. As evidence of this, in January, S&P upgraded the financial strength ratings of our two primary operating entities, Essent Guaranty and Essent Re to single A-minus. With this upgrade, we reached a milestone of single A-minus or higher financial strength ratings by all rating agencies that cover Essent Guaranty and Essent Re. During the year, we continue to execute our diversified and programmatic reinsurance strategy while retiring the majority of two-season Radnor Re ILN deals that no longer provided economic or regulatory capital credit. In the fourth quarter, we closed an excess of loss reinsurance transaction covering our 2023 NIW. At year-end 2023, approximately 93% of our portfolio is reinsured. Our strong financial performance and capital position enable us to take a measured approach between capital retention, investment and distribution. In 2023, we repurchased approximately 1.5 million shares for $66 million. Further, I’m pleased to announce that our Board has approved a 12% increase in our quarterly dividend at $0.28 per share. Looking forward, we will continue to review our common dividend annually. We believe paying a dividend is a meaningful demonstration of the confidence we have and the stability of our cash flows and the strength of our operating model. Now, let me turn the call over to Dave. David Weinstock: Thanks, Mark, and good morning, everyone. Let me review our results for the quarter in a little more detail. For the fourth quarter, we earned $1.64 per diluted share, compared to $1.66 last quarter and $1.37 in the fourth quarter a year ago. Our U.S. Mortgage Insurance Portfolio ended 2023 with Insurance In-Force of $239.1 billion, an increase of $417 million from September 30th, and an increase of $12 billion or 5% compared to $227.1 billion at December 31, 2022. Persistency at December 31, 2023 increased to 86.9%, compared to 86.6% at the end of the third quarter. The net premium yield for fourth quarter 2023, excuse me, net premiums earned for fourth quarter 2023 was $246 million and included $17.2 million of premiums earned by Essent Re on our third-party business and $17.4 million of premiums earned by the title operations. The average base premium rate for the U.S. Mortgage Insurance Portfolio for the fourth quarter was 40 basis points and the net average premium rate was 35 basis points in fourth quarter of 2023, with both consistent to last quarter. We expect that the average base premium rate for the full year 2024 will be largely unchanged from the fourth quarter rate of 40 basis points. Net income increased $3.5 million or 7% in the fourth quarter of 2023 compared to last quarter, due primarily to an increase in yields on new investments and higher yields on cash and equivalents. Other income in the fourth quarter was $6.4 million, compared to $5.6 million last quarter. The largest component of the increase was the change in fair value of embedded derivatives in certain of our third-party reinsurance agreements. In the fourth quarter, we recorded a $412,000 increase in the fair value of these embedded derivatives, compared to an $898,000 decrease recorded last quarter. The provision for loss and loss adjustment expenses was $19.6 million in the fourth quarter of 2023, compared to $10.8 million in the third quarter of 2023 and $4.1 million in the fourth quarter a year ago. At December 31st, the default rate on the U.S. Mortgage Insurance Portfolio was 1.8%, up 18 basis points from 1.62% at September 30, 2023. For the full year 2023, we’ve recorded a net provision of approximately $32 million as the increase in new defaults was materially offset by favorable reserve development from strong cure activity. Other underwriting and operating expenses in the fourth quarter were $55.2 million and include $11.6 million of title expenses. Expenses for the fourth quarter also include title premiums retained by agents of $11.5 million, which are reported separately on our consolidated income statement. Our consolidated expense ratio was 27% this quarter. Our consolidated expense ratio excluding title, which is a non-GAAP measure was 19% this quarter. A description of our consolidated expense ratio excluding title and the reconciliation to GAAP may be found in Exhibit O of our press release. We estimate that other underwriting and operating expenses excluding title operations will be approximately $180 million for the full year 2024. The effective tax rate for full year 2023 was 15.4%. Income tax expense for the fourth quarter includes a $2.7 million net benefit associated with the recognition of a deferred tax asset for unrealized losses on investment -- on the investment portfolios of Essent Group and Essent Re upon the enactment of the Bermuda Corporate Income Tax. For 2024, we estimate that the annual effective tax rate will be approximately 15.5%, excluding the impact of any discreet items. As Mark noted, our holding company liquidity remains strong and includes $400 million of undrawn revolver capacity under our committed credit facility. At December 31st, we had $425 million of term loan outstanding with a weighted average interest rate of 7.11%, up from 7.07% at September 30th. At December 31st, 2023, our debt-to-capital ratio was 8%. At December 31st, Essent Guaranty’s PMIERs sufficiency ratio was strong at 170%, with $1.4 billion in excess available assets. Excluding the 0.3 COVID factor, the PMIERs sufficiency ratio remains strong at 165%, with $1.3 billion in excess available assets. At quarter end, the combined U.S. Mortgage Insurance business statutory capital was $3.4 billion, with a risk-to-capital ratio of 10.2 to 1. Note that statutory capital includes $2.3 billion of contingency reserves at December 31st. Over the last 12 months, the U.S. Mortgage Insurance business has grown statutory capital by $198 million. During the fourth quarter and full year 2023, Essent Guaranty paid dividends of $55 million and $295 million, respectively, to its U.S. holding company. For 2024, the U.S. Mortgage Insurance companies can pay ordinary dividends of $304 million. During the fourth quarter, Essent Re paid a dividend of $60 million to Essent Group. Also in the quarter, Essent Group paid cash dividends totaling $26.4 million to shareholders and we repurchased 302,000 shares for $15 million under the authorization approved by our Board in May 2022. Now let me turn the call back over to Mark. Mark Casale: Thanks, Dave. In closing, we are pleased with our fourth quarter and full year 2023 financial results, which continue to reflect the strength of our operating model. Our high credit quality portfolio, combined with resilience in housing and employment, continues to translate to strong credit performance, while our franchise benefited from the impact of higher rates on investment income and persistency. Our strong operating performance continues to generate excess capital, which we will approach in a measured manner between retention, investment and distribution to our shareholders. We believe this approach is in the best long-term interest of Essent and our stakeholders, while Essent continues to play an integral role in supporting affordable and sustainable home ownership. Now let’s get to your questions. Operator? Operator: [Operator Instructions] Your first question comes from the line of Rick Shane with JPMorgan. Please go ahead. Rick Shane: Hey, Mark. Thanks for taking my questions and I appreciate your enthusiasm for taking the questions this morning. I suspect it’s from my peers, not from me, that you’re so excited that you want to hear the questions. Mark Casale: You were first on the list. Got us excited. Rick Shane: Oh! There you go. That’s a rough day, Mark. So it’s a kind of a high level question. I was on a call yesterday where the theme of the call was rates higher for longer and we’re clearly at a crossroads, and I don’t think anybody really knows what’s going to happen. One of the things that I’m really wrestling with is when I think of Essent and when I think of the sector, what are the scenarios that you think are the best and what are the scenarios that you think are the worst? I mean, it can’t be a heads I win, tails I win scenario. What do you worry about and what’s the ideal path forward from here? Mark Casale: Well, remember, Rick, I mean, taking a step back, right, rates get all of the press, but really credit is what drives our performance longer term. So if you just think through and forecast out our business over the next three years to five years, the real expenses are we manage them well and you can kind of see where the Insurance In-Force is going to grow relative to the industry. Investment income, that’ll ebb and flow depending on kind of where rates are. It’s the provision that really has the most volatility in it. So when I think of kind of 2024, it’s hard to tell with rates in terms of the markets going. I’m not sure it’s, everyone said it was higher for longer until the Fed spoke in December, then it became rates are going lower. I think from an Essent perspective, right? I think, we’re well positioned in that, we’re probably levered a bit positively to rates going down. If they don’t, and the reason why is 45% of our book, Rick, is still in that 2021 vintage, which is, it’s a little bit over 3%. So it’s not really going anywhere. So if rates go down, NIW increases, I’m not sure the persistency goes down in tandem the way kind of a normal hedge, just because of the unusual kind of lock-in effect of that portfolio. If rates stay higher for longer, yields stay high, cash continue -- the persistency in the book stays higher. We continue to generate cash flow. And the important thing for investors is we continue to grow book value per share, right? So I’ve heard a lot of things around growth. We’re growing book value per share. And if you just think about investment income for a second, Rick, we grew that $60 million year-over-year. If you were to equate that to Insurance In-Force, it’s close to like a $20 billion increase in Insurance In-Force. Just say $20 billion at 40 basis points, so base yield at a 35% combined ratio, which again, just shows you there’s different avenues for us to grow at Essent versus just kind of looking at the Insurance In-Force. So I’m not going to say there’s a hedge we win, tails we win scenario. I would just say from a, what are we concerned about? It’s still credit. It’s always credit. I’m not too worried about rates because I think, again, a lot of this is going to balance out. Credit is what we have our eye on, and I think there, as long as employment stays strong, I think, we’re in relatively good shape going into 2024. Rick Shane: Got it. Okay. Very helpful. Thanks, Mark. Mark Casale: Sure. Operator: Your next question comes from the line of Bose George with KBW. Please go ahead. Unidentified Analyst: Hey. Good morning, everyone. This is actually Alex [ph] on for Bose. Firstly, just wanted to get a little more color surrounding why the cure rate of 28% was lower this quarter. Looked like it -- it looked like it had been trending down from 90% in the fourth quarter of last year to 62% in 3Q. Is there anything specific that led that to decline sharply this quarter? Mark Casale: No, Alex. And again, I would caution investors to dig too far into new default rates, cure rates, percentage growth. We’ve seen -- we have heard a lot of the questions. And just big picture, Alex, we’re at 14,000 defaults on 820,000 policies and we’ve been relatively consistent around defaults. There’s a lot of noise in the defaults and the claims, more on the default side, because of the effect of forbearance, right? So take a look at forbearance. Really, the frictionless forbearance just ended a month ago. So what you’re seeing is you’re seeing defaults come in. There’s certain strategic defaulters that they’re getting a year extra on forbearance and then they’re curing. So there’s a lot of noise between the cure rates and the default rates, is -- what it really is is noise and now that there is more of a friction with forbearance in terms of what borrowers have to show, I would expect that to normalize in the coming 12-ish months to 18 months, it remains to be seen. But I think the message for investors is defaults are still the absolute level of defaults and even the default rate is pretty low. I think it’s 1.8 at the end of the fourth quarter. It was 1.6 something the quarter before, but still relatively good and I think that the credit performance continues to be strong. Unidentified Analyst: Got it. That makes sense. And then maybe just one more. I’m wondering if you could provide any updated color on pricing in the industry. I know you mentioned earlier that you all expect the base premium to be stable over the course of the year. But in the event, the economy does have a soft landing and remains strong. Is there any chance we see some downside pressure on premiums or not really? Mark Casale: No. I wouldn’t expect that. I think, again, given the flexibility of the pricing engines, it really has given the entire industry, again, I think, I mentioned this last quarter, a lot of the pricing power per se has moved to the industry versus the lenders, right? In the old rate cards, the lender had a lot of control, whether it was bidding things out or allocating based on other services. Now, it’s really the best rate for each borrower. All the MIs have picked their spots. And given where some of the pricing engines and data that we get in the industry, we can see a lot of the movements and the percentages and I think everyone else can too. So we all have a pretty good beat on it. And I think we price for unit economics and the industry kind of reached a pretty low point in early 2022. Pricing came up and we generally look at 12%-ish to 15% returns on unit economic basis. I would say they’re probably closer to the upper end now. It’s pretty good. But I think it’s well-priced and given kind of the nature of the risk. So I wouldn’t, in a small market -- that relatively smaller market, we see pretty consistent pricing. I’m not sure as the industry starts to -- if there is a soft landing and the market starts to grow, I wouldn’t see a lot of change in pricing. In fact, it’s rarely a discussion point anymore, even at the lender level, because it’s -- and that used to be all about pricing because they saw it. They don’t really see it. They’re focusing on other things. And like I said, it really allows the Essent and the rest of the industry to price on risk, delivering our best rates to borrowers and it’s kind of removed that a little bit from the equation around from our standpoint. Unidentified Analyst: Great. Thanks for taking the questions, Mark. Appreciate it. Mark Casale: Sure. Operator: [Operator Instructions] The next question comes from the line of Doug Harter with UBS. Please go ahead. Doug Harter: Thanks, Mark. Kind of hearing what you said about the risk of reading too much into kind of one quarter, but can you talk about how kind of the recent vintages are performing and how delinquencies and those trends are performing versus kind of more historical vintages? Mark Casale: Well, again, I think, there’s a lot of noise, Doug, with kind of the forbearance. We don’t see -- I’ll give you -- I’ll tell you one thing that we see, early payment defaults, right? Early payment defaults post-COVID are higher than they were pre-COVID. We assign most of that to forbearance, because a lot of those, they’re all curing and they’re not going to claim. So it’s back to what I said earlier about that frictionless cost or ease of forbearance is really creating some noise in the numbers. But again, step back, Doug. Our Insurance In-Force average FICO is 746. I mean and I know you cover a lot of different businesses, specialty finance, 746 is a pretty strong credit score. And also I would like to point out just in the context of time, right? If you think about when the GSEs really start -- the modern day GSEs started in right around the early 90s, right? That’s when DU and LP started the process and you had the standardization of the mortgage business. So if you go back from say 1990 to 2023, 33 years, Doug, and you look at losses on GSE mortgages, generally outside of the 2005 to 2007 vintage, they’re less than 100 basis points. So in the context of time and this is what we ensure every day. And then remember post-crisis, you had the advent of QM, you had the strengthening of the models, you had stronger QC, you had forbearance, you brought on PMIERs, which is good capital standards for the MI industry. We ensure boring GSE mortgages. It’s --and it’s a boring business and it’s great and we like it that way. But that’s why when people are looking at these type of quarter-to-quarter or trends, it is a little bit more of a specialty finance type approach to the business in terms of the questions and I would argue that we’re more like a specialty insurer. Our specialty happens to be mortgage and that’s our expertise, but we’re really a portfolio business, it’s driven by the portfolio, and again, just when you think about the topline that’s being driven off the business and just the stability of the credit, and I forgot to add that we’ve hedged a lot of the credit out too. So there’s that added layer of protection. Again, bigger picture of these, I think, we said it in the script, over $700 million of operating cash flow. The issue for the MI industry the next few years, isn’t going to be the performance of the portfolio or growth or any of those sorts of things, it’s really going to be allocation of capital. There’s a lot of capital being generated by Essent and others, and certain MI’s will allocate it one way and certain MI’s will do it the other way, but that’s really going to be the differentiator in the business, longer term from an investor perspective. So hopefully that gives you some color. Doug Harter: I appreciate it, Mark. Thank you. Operator: I’ll now turn the call back over to management for closing remarks. Please go ahead. Mark Casale: Yeah. Thank you everyone for your time today and have a great weekend. Operator: Ladies and gentlemen, that concludes today’s call. Thank you all for joining and you may now disconnect.
Essent Group Ltd. (NYSE:ESNT) Surpasses Earnings and Revenue Estimates
- Essent Group Ltd. (NYSE:ESNT) reported an EPS of $1.69, beating the Zacks Consensus Estimate.
- The company's revenue reached approximately $317.6 million, surpassing estimates and indicating a year-over-year increase.
- Essent Group's financial health is highlighted by a low debt-to-equity ratio of 0.088 and a current ratio of 1.06.
Essent Group Ltd. (NYSE:ESNT) is a prominent player in the insurance sector, specifically within the property and casualty industry. The company provides private mortgage insurance and reinsurance for mortgage loans. Essent Group competes with other insurance firms, striving to offer competitive rates and services. The company has recently reported its financial results for the first quarter of 2025, showcasing its performance in the market.
On May 9, 2025, Essent Group reported earnings per share (EPS) of $1.69, surpassing the Zacks Consensus Estimate of $1.66. This earnings surprise of 1.81% highlights the company's ability to exceed market expectations. However, it's worth noting that this figure represents a slight decrease from the $1.70 EPS reported in the same quarter last year. Despite this, Essent Group has managed to exceed consensus EPS estimates twice over the past four quarters.
In terms of revenue, Essent Group generated approximately $317.6 million for the quarter ending March 2025, surpassing the estimated $315.7 million. This revenue figure marks a 2.03% increase over the Zacks Consensus Estimate and a significant rise from the $298.36 million reported in the same period last year. The company has consistently exceeded consensus revenue estimates in three recent quarters, demonstrating its strong market position.
Essent Group's financial metrics provide further insight into its market valuation. The company has a price-to-earnings (P/E) ratio of 8.37, indicating how the market values its earnings. Additionally, the price-to-sales ratio stands at 4.75, reflecting the market's valuation of its revenue. The enterprise value to sales ratio is 5.03, suggesting how the company's total value compares to its sales. These metrics highlight Essent Group's financial health and market standing.
The company's financial stability is further supported by its low debt-to-equity ratio of 0.088, indicating a conservative approach to leveraging. With a current ratio of 1.06, Essent Group demonstrates its ability to cover short-term liabilities with short-term assets. The enterprise value to operating cash flow ratio of 7.40 shows how its cash flow is valued relative to its enterprise value. Additionally, an earnings yield of 11.94% indicates a strong return on investment for shareholders.
Essent Group Ltd. (NYSE:ESNT) Surpasses Earnings and Revenue Estimates
- Essent Group Ltd. (NYSE:ESNT) reported an EPS of $1.69, beating the Zacks Consensus Estimate.
- The company's revenue reached approximately $317.6 million, surpassing estimates and indicating a year-over-year increase.
- Essent Group's financial health is highlighted by a low debt-to-equity ratio of 0.088 and a current ratio of 1.06.
Essent Group Ltd. (NYSE:ESNT) is a prominent player in the insurance sector, specifically within the property and casualty industry. The company provides private mortgage insurance and reinsurance for mortgage loans. Essent Group competes with other insurance firms, striving to offer competitive rates and services. The company has recently reported its financial results for the first quarter of 2025, showcasing its performance in the market.
On May 9, 2025, Essent Group reported earnings per share (EPS) of $1.69, surpassing the Zacks Consensus Estimate of $1.66. This earnings surprise of 1.81% highlights the company's ability to exceed market expectations. However, it's worth noting that this figure represents a slight decrease from the $1.70 EPS reported in the same quarter last year. Despite this, Essent Group has managed to exceed consensus EPS estimates twice over the past four quarters.
In terms of revenue, Essent Group generated approximately $317.6 million for the quarter ending March 2025, surpassing the estimated $315.7 million. This revenue figure marks a 2.03% increase over the Zacks Consensus Estimate and a significant rise from the $298.36 million reported in the same period last year. The company has consistently exceeded consensus revenue estimates in three recent quarters, demonstrating its strong market position.
Essent Group's financial metrics provide further insight into its market valuation. The company has a price-to-earnings (P/E) ratio of 8.37, indicating how the market values its earnings. Additionally, the price-to-sales ratio stands at 4.75, reflecting the market's valuation of its revenue. The enterprise value to sales ratio is 5.03, suggesting how the company's total value compares to its sales. These metrics highlight Essent Group's financial health and market standing.
The company's financial stability is further supported by its low debt-to-equity ratio of 0.088, indicating a conservative approach to leveraging. With a current ratio of 1.06, Essent Group demonstrates its ability to cover short-term liabilities with short-term assets. The enterprise value to operating cash flow ratio of 7.40 shows how its cash flow is valued relative to its enterprise value. Additionally, an earnings yield of 11.94% indicates a strong return on investment for shareholders.
Essent Group Ltd. (NYSE:ESNT) Stock Update and Earnings Forecast
- Essent Group Ltd. (NYSE:ESNT) is anticipated to report first-quarter earnings of $1.65 per share, with revenue projected at $310.79 million.
- The company's stock price stands at $58.72, reflecting investor confidence despite previous weaker-than-expected earnings.
- Essent Group competes in the mortgage insurance industry and is rated "Outperform" by RBC Capital.
Essent Group Ltd. (NYSE:ESNT), headquartered in Hamilton, Bermuda, is a prominent player in the mortgage insurance industry. The company provides private mortgage insurance and reinsurance for mortgages secured by residential properties. Essent Group competes with other industry players like MGIC Investment Corporation and Radian Group. On May 9, 2025, RBC Capital updated its rating for Essent Group to "Outperform," with the stock priced at $58.72.
Essent Group is set to release its first-quarter earnings results on May 9, 2025. Analysts expect earnings of $1.65 per share, slightly down from $1.70 per share in the same period last year. Despite this, the company anticipates an increase in quarterly revenue, projected at $310.79 million, up from $298.36 million a year earlier. This revenue growth indicates a positive outlook for the company's financial health.
Previously, on February 14, Essent Group reported weaker-than-expected earnings for the fourth quarter. Despite this, the stock experienced a modest rise of 0.6%, closing at $58.72. This resilience in stock performance suggests investor confidence in the company's long-term prospects, even amid short-term earnings challenges.
The stock, currently priced at $58.72, reflects a change of $0.33, or an increase of approximately 0.57%. During the trading day, the stock fluctuated between a low of $58.59 and a high of $59.39. Over the past year, the stock has reached a high of $65.33 and a low of $51.61. Essent Group's market capitalization stands at approximately $6.07 billion, with a trading volume of 775,314 shares.
Essent Group Ltd. (NYSE:ESNT) Stock Update and Earnings Forecast
- Essent Group Ltd. (NYSE:ESNT) is anticipated to report first-quarter earnings of $1.65 per share, with revenue projected at $310.79 million.
- The company's stock price stands at $58.72, reflecting investor confidence despite previous weaker-than-expected earnings.
- Essent Group competes in the mortgage insurance industry and is rated "Outperform" by RBC Capital.
Essent Group Ltd. (NYSE:ESNT), headquartered in Hamilton, Bermuda, is a prominent player in the mortgage insurance industry. The company provides private mortgage insurance and reinsurance for mortgages secured by residential properties. Essent Group competes with other industry players like MGIC Investment Corporation and Radian Group. On May 9, 2025, RBC Capital updated its rating for Essent Group to "Outperform," with the stock priced at $58.72.
Essent Group is set to release its first-quarter earnings results on May 9, 2025. Analysts expect earnings of $1.65 per share, slightly down from $1.70 per share in the same period last year. Despite this, the company anticipates an increase in quarterly revenue, projected at $310.79 million, up from $298.36 million a year earlier. This revenue growth indicates a positive outlook for the company's financial health.
Previously, on February 14, Essent Group reported weaker-than-expected earnings for the fourth quarter. Despite this, the stock experienced a modest rise of 0.6%, closing at $58.72. This resilience in stock performance suggests investor confidence in the company's long-term prospects, even amid short-term earnings challenges.
The stock, currently priced at $58.72, reflects a change of $0.33, or an increase of approximately 0.57%. During the trading day, the stock fluctuated between a low of $58.59 and a high of $59.39. Over the past year, the stock has reached a high of $65.33 and a low of $51.61. Essent Group's market capitalization stands at approximately $6.07 billion, with a trading volume of 775,314 shares.
Essent Group Ltd. (NYSE:ESNT) Q1 2024 Earnings Conference Highlights
Essent Group Ltd. (NYSE:ESNT) Q1 2024 Earnings Conference Highlights
Essent Group Ltd. (NYSE:ESNT) recently held its Q1 2024 Earnings Conference Call, drawing significant attention from investors and analysts alike. The call, detailed by Seeking Alpha, featured discussions led by key company figures, aiming to shed light on Essent Group's financial performance and strategic outlook for the first quarter of 2024. This event was particularly noteworthy as it came at a time when Essent Group is showing promising signs of a strong earnings season ahead.
Analysts have adjusted their earnings estimates upwards, with the Most Accurate Estimate for the current quarter now standing at $1.58 per share, surpassing the Zacks Consensus Estimate of $1.56 per share. This positive adjustment has led to a Zacks Earnings ESP of +1.28% for Essent Group, hinting at the company's potential to exceed expectations in its forthcoming earnings report.
The importance of a positive Zacks Earnings ESP cannot be overstated, especially when combined with Essent Group's current Zacks Rank #3 (Hold). Historical data reveals that stocks with a positive Earnings ESP and at least a Zacks Rank #3 have a strong track record of beating earnings estimates nearly 70% of the time, while also delivering impressive average annual returns of over 28%. This statistical backdrop provides a solid foundation for the optimism surrounding Essent Group's performance, suggesting that the company is on a promising trajectory for its earnings announcement.
Adding to the anticipation, Essent Group's stock performance has been noteworthy. The company's shares saw an increase of $0.26, marking a change of approximately 0.48%, with trading activity fluctuating between $53.05 and $55.05 throughout the day. Over the past year, ESNT's stock has experienced a range between $41.38 and $59.9, reflecting the market's varying perceptions of the company's value. Currently, Essent Group boasts a market capitalization of approximately $5.83 billion, with a trading volume of 458,950 shares. This financial profile underscores the company's substantial presence in the market and highlights the keen interest from the investment community.
The recent adjustments in earnings estimates, coupled with Essent Group's solid market performance, paint a picture of a company that is potentially on the cusp of delivering a strong earnings report. Investors and analysts, having witnessed the company's stock price movement and considering the latest, most accurate earnings estimates, are poised with anticipation. The combination of a favorable Zacks Earnings ESP, a Zacks Rank #3, and positive market dynamics suggests that Essent Group Ltd. may indeed surpass expectations, reinforcing the optimism surrounding its financial health and strategic direction as it moves forward into 2024.
Essent Reports Better Than Expected Q1 Earnings Results
Essent Group (NYSE:ESNT) reported its Q1 earnings results on Friday, with EPS coming in at $1.59, above the Street estimate of $1.46. Revenue was $256.25 million, beating the Street estimate of $250.26 million.
The company’s quarterly results built on its 2022 performance as it turned in strong margins, healthy IIF growth, and resumed repurchases. The balance sheet remains robust and industry pricing is continuing to move in the company's favor.
Analysts at RBC Capital reiterated their expectation for premium growth in H2/23. While near-term the analysts expect performance to be bumpy as macro conditions remain volatile, they see the current valuation as an attractive entry point and remain Outperform.
Essent Reports Better Than Expected Q1 Earnings Results
Essent Group (NYSE:ESNT) reported its Q1 earnings results on Friday, with EPS coming in at $1.59, above the Street estimate of $1.46. Revenue was $256.25 million, beating the Street estimate of $250.26 million.
The company’s quarterly results built on its 2022 performance as it turned in strong margins, healthy IIF growth, and resumed repurchases. The balance sheet remains robust and industry pricing is continuing to move in the company's favor.
Analysts at RBC Capital reiterated their expectation for premium growth in H2/23. While near-term the analysts expect performance to be bumpy as macro conditions remain volatile, they see the current valuation as an attractive entry point and remain Outperform.
