MGIC INVESTMENT CORP (MTG) Stock Fundamental Analysis
NYSE:MTG - New York Stock Exchange, Inc. - US5528481030 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to MTG. MTG was compared to 101 industry peers in the Financial Services industry. MTG has only an average score on both its financial health and profitability. A decent growth rate in combination with a cheap valuation! Better keep an eye on MTG.
1. Profitability
1.1 Basic Checks
MTG had positive earnings in the past year.
In the past year MTG had a positive cash flow from operations.
Each year in the past 5 years MTG has been profitable.
MTG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
MTG has a Return On Assets of 11.66%. This is amongst the best in the industry. MTG outperforms 94.06% of its industry peers.
MTG has a better Return On Equity (14.79%) than 71.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.66% | ||
| ROE | 14.79% | ||
| ROIC | N/A |
ROA(3y)12.16%
ROA(5y)10.24%
ROE(3y)15.82%
ROE(5y)14%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
MTG has a Profit Margin of 62.58%. This is amongst the best in the industry. MTG outperforms 98.02% of its industry peers.
In the last couple of years the Profit Margin of MTG has grown nicely.
With an excellent Operating Margin value of 82.50%, MTG belongs to the best of the industry, outperforming 97.03% of the companies in the same industry.
MTG's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 82.5% | ||
| PM (TTM) | 62.58% | ||
| GM | N/A |
OM growth 3Y2.71%
OM growth 5Y2.31%
PM growth 3Y5.66%
PM growth 5Y2.62%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
MTG does not have a ROIC to compare to the WACC, probably because it is not profitable.
MTG has less shares outstanding than it did 1 year ago.
The number of shares outstanding for MTG has been reduced compared to 5 years ago.
Compared to 1 year ago, MTG has about the same debt to assets ratio.
2.2 Solvency
The Debt to FCF ratio of MTG is 0.84, which is an excellent value as it means it would take MTG, only 0.84 years of fcf income to pay off all of its debts.
MTG's Debt to FCF ratio of 0.84 is amongst the best of the industry. MTG outperforms 87.13% of its industry peers.
MTG has a Debt/Equity ratio of 0.13. This is a healthy value indicating a solid balance between debt and equity.
MTG has a better Debt to Equity ratio (0.13) than 73.27% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.84 | ||
| Altman-Z | N/A |
ROIC/WACCN/A
WACC8.44%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
MTG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.09%, which is quite good.
The Earnings Per Share has been growing by 9.48% on average over the past years. This is quite good.
The Revenue has been growing slightly by 3.26% in the past year.
Measured over the past years, MTG shows a decrease in Revenue. The Revenue has been decreasing by -0.10% on average per year.
EPS 1Y (TTM)12.09%
EPS 3Y14.47%
EPS 5Y9.48%
EPS Q2Q%6.49%
Revenue 1Y (TTM)3.26%
Revenue growth 3Y0.62%
Revenue growth 5Y-0.1%
Sales Q2Q%-0.34%
3.2 Future
MTG is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 4.02% yearly.
MTG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.70% yearly.
EPS Next Y1.3%
EPS Next 2Y2.62%
EPS Next 3Y4.02%
EPS Next 5YN/A
Revenue Next Year1.55%
Revenue Next 2Y2.3%
Revenue Next 3Y2.7%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
MTG is valuated reasonably with a Price/Earnings ratio of 8.88.
MTG's Price/Earnings ratio is a bit cheaper when compared to the industry. MTG is cheaper than 76.24% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.48, MTG is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 8.87, the valuation of MTG can be described as reasonable.
Based on the Price/Forward Earnings ratio, MTG is valued a bit cheaper than the industry average as 63.37% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 34.04, MTG is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.88 | ||
| Fwd PE | 8.87 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MTG is valued cheaper than 86.14% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of MTG indicates a rather cheap valuation: MTG is cheaper than 80.20% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.37 | ||
| EV/EBITDA | 6.52 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates MTG does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of MTG may justify a higher PE ratio.
PEG (NY)6.84
PEG (5Y)0.94
EPS Next 2Y2.62%
EPS Next 3Y4.02%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.22%, MTG has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 5.33, MTG pays a bit more dividend than its industry peers.
MTG's Dividend Yield is comparable with the S&P500 average which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.22% |
5.2 History
On average, the dividend of MTG grows each year by 33.24%, which is quite nice.
MTG has been paying a dividend for at least 10 years, so it has a reliable track record.
MTG has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)33.24%
Div Incr Years5
Div Non Decr Years5
5.3 Sustainability
17.21% of the earnings are spent on dividend by MTG. This is a low number and sustainable payout ratio.
MTG's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP17.21%
EPS Next 2Y2.62%
EPS Next 3Y4.02%
27.17
+0.71 (+2.68%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners99.59%
Inst Owner Change1.6%
Ins Owners1.79%
Ins Owner Change9.96%
Market Cap6.45B
Analysts51.43
Price Target27.88 (2.61%)
Short Float %2.45%
Short Ratio2.63
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.22% |
Yearly Dividend0.5
Dividend Growth(5Y)33.24%
DP17.21%
Div Incr Years5
Div Non Decr Years5
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.42%
Min EPS beat(2)8.29%
Max EPS beat(2)12.54%
EPS beat(4)4
Avg EPS beat(4)10.63%
Min EPS beat(4)6.93%
Max EPS beat(4)14.77%
EPS beat(8)8
Avg EPS beat(8)12.35%
EPS beat(12)12
Avg EPS beat(12)17.99%
EPS beat(16)16
Avg EPS beat(16)21.25%
Revenue beat(2)0
Avg Revenue beat(2)-1.19%
Min Revenue beat(2)-1.56%
Max Revenue beat(2)-0.82%
Revenue beat(4)0
Avg Revenue beat(4)-1.21%
Min Revenue beat(4)-1.67%
Max Revenue beat(4)-0.79%
Revenue beat(8)1
Avg Revenue beat(8)-1.54%
Revenue beat(12)1
Avg Revenue beat(12)-1.88%
Revenue beat(16)1
Avg Revenue beat(16)-1.61%
PT rev (1m)0%
PT rev (3m)1.88%
EPS NQ rev (1m)-0.6%
EPS NQ rev (3m)-0.2%
EPS NY rev (1m)-0.2%
EPS NY rev (3m)3.6%
Revenue NQ rev (1m)0.04%
Revenue NQ rev (3m)-0.45%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.88 | ||
| Fwd PE | 8.87 | ||
| P/S | 5.29 | ||
| P/FCF | 8.37 | ||
| P/OCF | 8.36 | ||
| P/B | 1.25 | ||
| P/tB | 1.25 | ||
| EV/EBITDA | 6.52 |
EPS(TTM)3.06
EY11.26%
EPS(NY)3.06
Fwd EY11.28%
FCF(TTM)3.25
FCFY11.95%
OCF(TTM)3.25
OCFY11.97%
SpS5.13
BVpS21.71
TBVpS21.71
PEG (NY)6.84
PEG (5Y)0.94
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.66% | ||
| ROE | 14.79% | ||
| ROCE | N/A | ||
| ROIC | N/A | ||
| ROICexc | N/A | ||
| ROICexgc | N/A | ||
| OM | 82.5% | ||
| PM (TTM) | 62.58% | ||
| GM | N/A | ||
| FCFM | 63.26% |
ROA(3y)12.16%
ROA(5y)10.24%
ROE(3y)15.82%
ROE(5y)14%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y2.71%
OM growth 5Y2.31%
PM growth 3Y5.66%
PM growth 5Y2.62%
GM growth 3YN/A
GM growth 5YN/A
F-Score8
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.84 | ||
| Debt/EBITDA | 0.63 | ||
| Cap/Depr | 8.19% | ||
| Cap/Sales | 0.09% | ||
| Interest Coverage | 29.48 | ||
| Cash Conversion | 75.82% | ||
| Profit Quality | 101.08% | ||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z | N/A |
F-Score8
WACC8.44%
ROIC/WACCN/A
Cap/Depr(3y)6.04%
Cap/Depr(5y)6.01%
Cap/Sales(3y)0.18%
Cap/Sales(5y)0.23%
Profit Quality(3y)89.78%
Profit Quality(5y)108.35%
High Growth Momentum
Growth
EPS 1Y (TTM)12.09%
EPS 3Y14.47%
EPS 5Y9.48%
EPS Q2Q%6.49%
EPS Next Y1.3%
EPS Next 2Y2.62%
EPS Next 3Y4.02%
EPS Next 5YN/A
Revenue 1Y (TTM)3.26%
Revenue growth 3Y0.62%
Revenue growth 5Y-0.1%
Sales Q2Q%-0.34%
Revenue Next Year1.55%
Revenue Next 2Y2.3%
Revenue Next 3Y2.7%
Revenue Next 5YN/A
EBIT growth 1Y2.59%
EBIT growth 3Y3.34%
EBIT growth 5Y2.2%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y19.83%
FCF growth 3Y1.5%
FCF growth 5Y3.69%
OCF growth 1Y19.64%
OCF growth 3Y1.36%
OCF growth 5Y3.53%