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MGIC Investment (MTG) Q1 Earnings Top, Revenues Fall Y/Y
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MGIC Investment Corporation (MTG - Free Report) reported first-quarter 2022 operating net income per share of 60 cents, which beat the Zacks Consensus Estimate by 3.4%. The reported figure increased 42.8% year over year.
The insurer witnessed higher premiums and net investment income, offset by higher expenses.
MGIC Investment Corporation Price, Consensus and EPS Surprise
Insurance in force increased 10.2% from the prior-year quarter to $277.3 billion.
The insurer witnessed a 42.3% decrease in primary delinquency to 30,462 loans.
MGIC Investment recorded total operating revenues of $294.6 million, which decreased 1.1% year over year due to a change in net realized investment gains and losses related to the investment portfolio.
Net premiums written increased 0.5% year over year to $242.7 million. The increase in net premiums written was due to an increase in insurance in force and a decrease in ceded premiums from its quota share reinsurance transactions. It was partially offset by lower new insurance written and a decrease in premium yield.
Net investment income increased 0.9% year over year to $38.3 million. Persistency — the percentage of insurance remaining in force from one year prior — was 66.9% as of Mar 31, 2022, up 1070 basis points (bps) year over year.
New insurance written was $19.6 billion, down 36.4% year over year due to a decrease in the refinance market.
Net underwriting and other expenses totaled $57.5 million, up 13.4% year over year, due to increases in expenses related to investments in technology and data and analytics infrastructure.
For the quarter under review, the loss ratio was (7.6%) compared with 15.5% for the first quarter of 2021.
Financial Update
Book value per share, a measure of net worth, declined 2.8% from 2021-end to $14.75 as of Mar 31, 2022.
MGIC Investment had $409 million in cash, cash equivalents and investments, down 38.3% from the 2021-end level.
Total assets were $6.8 billion, down 6.6% from the 2021-end level.
Capital Deployment
MGIC Investment paid out dividends of $400 million to its holding company and paid 8 cents in dividend per common share to shareholders during first-quarter 2022.
As of Mar 31, 2022, MTG had shares worth $372 million remaining under the share buyback authorization.
Of the insurance industry players that have reported first-quarter results so far, Prudential Financial, Inc. (PRU - Free Report) , Assurant, Inc. (AIZ - Free Report) and American International Group, Inc. (AIG - Free Report) beat the respective Zacks Consensus Estimate.
Prudential Financial’s first-quarter 2022 operating net income of $3.17 per share beat the Zacks Consensus Estimate by 18.7%. The bottom line decreased 20.6% year over year.
Total revenues of $13.6 billion were down 0.7% year over year due to lower policy charges and fee income, asset management fees, commissions and other income. The top line missed the Zacks Consensus Estimate by about 3.7%. Total benefits and expenses of $12.1 billion were up 3.2% year over year for the quarter.
Assurant reported first-quarter 2022 net operating income of $3.75 per share, which beat the Zacks Consensus Estimate by 31%. The bottom line increased 51.8% from the year-ago quarter.
Total revenues increased 4.6% year over year to $2.5 billion due to higher net earned premiums, fees and other income and net investment income. The top line however missed the Zacks Consensus Estimate by 2.3%. Net investment income was up 13.1% year over year to $86.3 million.
American International posted first-quarter 2022 adjusted operating earnings of $1.30 per share, which beat the Zacks Consensus Estimate by 4.8%. AIG’s bottom line climbed 23.8% year over year.
Total operating revenues of AIG amounted to $11 billion, which improved 3.5% year over year in the first quarter on the back of higher premiums. However, the top line missed the consensus mark by 1.6%. Total net investment income of $3.2 billion tumbled 11% year over year in the quarter under review.
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MGIC Investment (MTG) Q1 Earnings Top, Revenues Fall Y/Y
MGIC Investment Corporation (MTG - Free Report) reported first-quarter 2022 operating net income per share of 60 cents, which beat the Zacks Consensus Estimate by 3.4%. The reported figure increased 42.8% year over year.
The insurer witnessed higher premiums and net investment income, offset by higher expenses.
MGIC Investment Corporation Price, Consensus and EPS Surprise
MGIC Investment Corporation price-consensus-eps-surprise-chart | MGIC Investment Corporation Quote
Operational Update
Insurance in force increased 10.2% from the prior-year quarter to $277.3 billion.
The insurer witnessed a 42.3% decrease in primary delinquency to 30,462 loans.
MGIC Investment recorded total operating revenues of $294.6 million, which decreased 1.1% year over year due to a change in net realized investment gains and losses related to the investment portfolio.
Net premiums written increased 0.5% year over year to $242.7 million. The increase in net premiums written was due to an increase in insurance in force and a decrease in ceded premiums from its quota share reinsurance transactions. It was partially offset by lower new insurance written and a decrease in premium yield.
Net investment income increased 0.9% year over year to $38.3 million.
Persistency — the percentage of insurance remaining in force from one year prior — was 66.9% as of Mar 31, 2022, up 1070 basis points (bps) year over year.
New insurance written was $19.6 billion, down 36.4% year over year due to a decrease in the refinance market.
Net underwriting and other expenses totaled $57.5 million, up 13.4% year over year, due to increases in expenses related to investments in technology and data and analytics infrastructure.
For the quarter under review, the loss ratio was (7.6%) compared with 15.5% for the first quarter of 2021.
Financial Update
Book value per share, a measure of net worth, declined 2.8% from 2021-end to $14.75 as of Mar 31, 2022.
MGIC Investment had $409 million in cash, cash equivalents and investments, down 38.3% from the 2021-end level.
Total assets were $6.8 billion, down 6.6% from the 2021-end level.
Capital Deployment
MGIC Investment paid out dividends of $400 million to its holding company and paid 8 cents in dividend per common share to shareholders during first-quarter 2022.
As of Mar 31, 2022, MTG had shares worth $372 million remaining under the share buyback authorization.
Zacks Rank
MGIC Investment currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Some Other Multi-line Insurers
Of the insurance industry players that have reported first-quarter results so far, Prudential Financial, Inc. (PRU - Free Report) , Assurant, Inc. (AIZ - Free Report) and American International Group, Inc. (AIG - Free Report) beat the respective Zacks Consensus Estimate.
Prudential Financial’s first-quarter 2022 operating net income of $3.17 per share beat the Zacks Consensus Estimate by 18.7%. The bottom line decreased 20.6% year over year.
Total revenues of $13.6 billion were down 0.7% year over year due to lower policy charges and fee income, asset management fees, commissions and other income. The top line missed the Zacks Consensus Estimate by about 3.7%. Total benefits and expenses of $12.1 billion were up 3.2% year over year for the quarter.
Assurant reported first-quarter 2022 net operating income of $3.75 per share, which beat the Zacks Consensus Estimate by 31%. The bottom line increased 51.8% from the year-ago quarter.
Total revenues increased 4.6% year over year to $2.5 billion due to higher net earned premiums, fees and other income and net investment income. The top line however missed the Zacks Consensus Estimate by 2.3%. Net investment income was up 13.1% year over year to $86.3 million.
American International posted first-quarter 2022 adjusted operating earnings of $1.30 per share, which beat the Zacks Consensus Estimate by 4.8%. AIG’s bottom line climbed 23.8% year over year.
Total operating revenues of AIG amounted to $11 billion, which improved 3.5% year over year in the first quarter on the back of higher premiums. However, the top line missed the consensus mark by 1.6%. Total net investment income of $3.2 billion tumbled 11% year over year in the quarter under review.