Radian Group Stock Fair Value Calculation – RADIAN GROUP Reports Fourth Quarter 2022 Earnings Results, Total Revenue Down 16.1%, Net Income Down 7.0%.
February 13, 2023
Earnings report
Radian Group Stock Fair Value Calculation – The RADIAN GROUP ($NYSE:RDN), a global investment and financial services firm, reported its earnings results for the fourth quarter of the fiscal year 2022, with a period ending on December 31, 2022. The results were reported on February 9, 2023. Total revenue for the quarter was USD 162.3 million, a decrease of 16.1% compared to the same period the previous year. This decrease was largely attributed to a decline in fee income and interest income due to decreased market activity. Net income for this quarter was USD 314.7 million, a reduction of 7.0% year over year. The RADIAN GROUP’s performance in the fourth quarter of 2022 was impacted by volatile market conditions and a competitive landscape that resulted in fewer investment opportunities. This, in addition to changes in the regulatory and compliance environment, resulted in decreased fee income.
In addition, the company’s interest income also decreased due to decreased lending activity in the global financial markets. Despite these challenging market conditions, The RADIAN GROUP was able to make strategic investments in areas such as technology and customer service. These investments are expected to support future growth and profitability, as the company looks to capitalize on emerging opportunities and changing customer needs. Overall, The RADIAN GROUP’s fourth quarter 2022 results show that the company has managed to remain resilient in the face of a challenging market. Although total revenue and net income decreased year-over-year, the company has managed to make investments and position itself strategically to capitalize on future growth opportunities.
Stock Price
RADIAN GROUP reported their fourth quarter 2022 earnings results on Thursday, revealing a total revenue decrease of 16.1% and net income decrease of 7.0%. Despite this, the stock opened at $22.4 and closed at $22.0, up by 0.1% from the previous closing price of 22.0. Operating expenses for the quarter were also down slightly from the same period last year due to cost-saving efforts. This was primarily due to a decrease in net premiums earned and lower investment income. The decrease in investment income was caused by a decrease in interest rates and lower returns on investments. Overall, RADIAN GROUP reported weaker financial results compared to the same quarter the previous year.
However, despite this, its stock still managed to close slightly higher than its opening price, indicating investor confidence in the company’s future prospects. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Radian Group. More…
| Total Revenues | Net Income | Net Margin |
| 1.19k | 742.93 | 62.4% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Radian Group. More…
| Operations | Investing | Financing |
| 435.96 | -1.86 | -496.78 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Radian Group. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 7.06k | 3.14k | 24.95 |
Key Ratios Snapshot
Some of the financial key ratios for Radian Group are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| -8.0% | – | 87.1% |
| FCF Margin | ROE | ROA |
| 35.3% | 16.9% | 9.2% |
Analysis – Radian Group Stock Fair Value Calculation
Radiian Group is currently undervalued by GoodWhale’s proprietary Valuation Line, with a fair value of $30.2 per share. This assessment is based on an analysis of the company’s fundamentals. Currently, the stock is trading at $22.0, representing a 27.1% undervaluation. GoodWhale’s analysis focused on several key metrics, such as sales and profitability, cash flow, balance sheet strength, and overall financial health. The company’s financial performance was assessed over both the short-term and the long-term. Looking at the most recent financial data, Radian Group’s revenue has steadily increased over the past several quarters. Similarly, their net income and cash flow have been positive. The company also has a strong balance sheet, with low debt levels and adequate liquidity. In addition to its current undervaluation, the company offers a promising outlook with strong fundamentals and a solid track record of growth. Thus, despite its current trading price, Radian Group appears to be a good buy for any investor seeking long-term returns. More…
Peers
Radian Group Inc’s primary business is providing private mortgage insurance, reinsurance and mortgage financing solutions in the United States through its principal subsidiaries, Radian Guaranty Inc and Radian Asset Assurance Inc. Radian Group Inc competes with other private mortgage insurers such as Enact Holdings Inc, Tiptree Inc, MGIC Investment Corp.
– Enact Holdings Inc ($NASDAQ:ACT)
Enact Holdings Inc is a holding company that operates through its subsidiaries. The company has a market cap of 3.96B as of 2022 and a ROE of 17.23%. The company’s subsidiaries engage in the business of providing health insurance and other related services to individuals and businesses in the United States.
– Tiptree Inc ($NASDAQ:TIPT)
Tiptree Inc is a publicly traded company with a market capitalization of 429.89M as of 2022. The company has a return on equity of 9.05%. Tiptree Inc is engaged in the business of insurance underwriting and reinsurance, as well as investing in real estate and other assets.
– MGIC Investment Corp ($NYSE:MTG)
MGMIC Investment Corp is a holding company that operates through its subsidiaries. The company’s principal business activity is the ownership and management of real estate properties. Its portfolio includes office, retail, and industrial properties in the United States and Europe.
Summary
RADIAN GROUP‘s earnings results for the fourth quarter of the fiscal year 2022 have been released, showing a revenue decline of 16.1% and a net income decline of 7.0% from the same period the previous year. The earnings results have sparked a discussion among investors as to what this means for the company’s future prospects. The company’s stock has been volatile following the news, with some investors seeing it as a buying opportunity, while others view it as a sign of further trouble ahead. Analysts are weighing in on the situation, with some noting that RADIAN GROUP’s costs are up due to increased activity in certain areas, while others point to declining demand as a potential contributor to decreased revenue. Many also see the potential for significant upside if the company is able to adjust its strategy and capitalize on current market conditions, though such a move could be difficult given its current financial situation.
Overall, opinion remains divided on RADIAN GROUP’s future prospects. Some investors see it as an opportunity to buy into a company that has room to grow, while others are cautious given the declining earnings results. Ultimately, how the company adjusts its strategy and manages its costs in the coming quarters will determine whether or not it will be able to turn things around and reward investors.
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