NMI Holdings Inc

NMI Holdings said its insurance in force has grown 49% over the past four years, far outpacing the 13% growth of the broader private mortgage insurance industry. In the second quarter of 2026, primary insurance in force rose 5.8% year over year to $227.1 billion, while new insurance written climbed 29% to $16.1 billion, helping push net premiums earned up 5.7% to $157.5 million. Underwriting held firm as the second-quarter 2026 loss ratio improved to 8.3% from 9%, and adjusted earnings per share rose 14% year over year to $1.38. Among peers, MGIC Investment Corporation reported second-quarter 2026 new insurance written of $17.8 billion, up 8.5%, with insurance in force up 2.6% to $304.8 billion, while Radian Group's primary insurance in force reached roughly $284 billion, up about 3%. The Zacks Consensus Estimate projects NMI Holdings' 2026 earnings per share will rise 6.7% year over year on revenues of $752.4 million, up 6.5%, with 2027 earnings per share and revenues seen increasing 4.7% and 2.3%, respectively.

NMI Holdings shares have gained 20.9% in the past three months, outperforming the industry's 5.5% growth and closing at $45.66 per share on Wednesday, near its 52-week high of $46.74. The stock's performance was supported by rapid insurance in force growth, strong new business generation, higher premiums, lower claims, and solid return on equity, along with record second-quarter earnings, a strong capital position, and ongoing share repurchases. Analysts' average price target of $48.86 suggests a potential 7% upside, while the stock trades at a trailing 12-month price-to-book value of 1.27X, below the industry average of 1.42X. The Zacks Consensus Estimate for 2026 earnings per share indicates a year-over-year increase of 6.7%, with revenues pegged at $752.36 million, implying a 6.5% improvement, and the expected long-term earnings growth rate is 7.1%. New insurance written rose to $16.1 billion in the second quarter of 2026 from $12.5 billion a year ago, primary insurance in force increased 5.8% year over year to $227.1 billion, and net premiums earned increased to $157.5 million from $149.1 million, while the loss ratio improved 70 basis points to 8.3% and the default rate remained low at 1.16%. At June 30, 2026, total PMIERs available assets were $3.7 billion against $2.1 billion of net risk-based required assets, and the company repurchased $31.4 million of shares in the second quarter, with book value per share excluding unrealized investment gains up 15% year over year to $36.88.

Kinsale Capital Group reported second-quarter revenues of $548.5 million, up 16.8% year on year and 14.9% above analyst expectations, making it the biggest estimate beat among the 32 property and casualty insurance stocks tracked. The group as a whole beat revenue consensus by 2.3% and guided next quarter 0.9% above estimates, with share prices holding steady on average. Essent Group posted revenues of $362.7 million, up 13.6% and 9.7% above expectations, while Radian Group's revenues of $580.7 million, up 90.8%, were in line but accompanied by a significant EPS miss. NMI Holdings and Selective Insurance Group also reported beats, with revenues of $187.9 million and $1.39 billion respectively.

NMI Holdings may be undervalued by about 8% following its record second-quarter 2026 results, according to a Simply Wall St analysis. The most widely followed narrative points to a fair value of $48 per share, compared with the last close at $44.30. The company reported higher revenue, net income, and earnings per share, along with growth in insurance volume and ongoing share repurchases. The valuation view rests on steady revenue growth, resilient margins, and ongoing capital returns to shareholders, though risks include mortgage cycle exposure and potential regulatory changes.

NMI Holdings beat Wall Street's revenue and profit expectations for the second quarter of 2026. Revenue rose 8.1% year on year to $187.9 million, exceeding analyst estimates of $185.2 million, while adjusted earnings per share of $1.38 came in 7.6% above the consensus of $1.28. The mortgage insurer grew its primary insurance in force to $227.1 billion, driven by $16 billion of new insurance written during the quarter. Default rates remained low at 1.16%, supported by strong employment and rising home prices, and the company repurchased $31.4 million in stock, bringing total buybacks since 2022 to $408 million. Management cautioned that seasonal headwinds and macroeconomic uncertainties could affect credit performance in the second half of the year.

MGIC Investment Corporation's core mortgage insurance business generates recurring premium income from its large insurance-in-force portfolio, with policies typically remaining in force until borrowers refinance, sell their homes, or accumulate sufficient equity. The company benefits from growth in purchase mortgage originations, expanding insurance-in-force, and sustained demand for private mortgage insurance as an alternative to government-backed programs. Strong underwriting discipline, high-quality new insurance written, favorable home price appreciation, and healthy employment conditions contribute to low claim frequencies and strong underwriting profitability. MGIC also earns investment income by investing premium collections before claims are paid, and combined with prudent capital management, reinsurance programs, and disciplined risk management, maintains a resilient balance sheet while optimizing capital efficiency. Overall, the mortgage insurance segment provides a scalable, capital-light business model that generates consistent earnings and strong cash flow across housing cycles.

NMI Holdings operates as a pure-play private mortgage insurer through its primary subsidiary, National Mortgage Insurance Corporation, generating virtually all of its revenue from mortgage insurance. The business benefits from growth in purchase mortgage originations, higher insurance-in-force, and increased adoption of private mortgage insurance relative to government-backed programs. Recurring premium revenues provide predictable cash flows, while disciplined underwriting and risk-based pricing have historically maintained low claim rates and favorable loss ratios. Favorable housing market trends, including strong home purchase activity and rising first-time homebuyer demand, further support expanding insurance-in-force and improved profitability. The stock has gained 1% year-to-date, outperforming its industry, and carries a Value Score of A with a forward price-to-book of 1.19X, below the industry average of 1.44X.