MGIC Investment Corporation (NYSE:MTG) Receives Average Recommendation of "Reduce" from Brokerages

Key Points

• Brokerages have assigned MGIC Investment Corporation an average recommendation of "Reduce", with one sell rating and five hold ratings among six covering firms.
• The company recently increased its quarterly dividend to $0.15 per share, up from $0.13, representing an annualized yield of 2.2%.
• Insider trading activity includes several executives selling shares, with CEO Timothy J. Mattke selling 139,203 shares valued at approximately $3.69 million.

Shares of MGIC Investment Corporation (NYSE:MTG - Get Free Report) have been given an average recommendation of "Reduce" by the six ratings firms that are covering the company, MarketBeat reports. One equities research analyst has rated the stock with a sell recommendation and five have assigned a hold recommendation to the company. The average 1-year price target among analysts that have updated their coverage on the stock in the last year is $26.6667.

Several research analysts have commented on the company. Compass Point reaffirmed a "neutral" rating and set a $28.00 price target (up previously from $27.00) on shares of MGIC Investment in a research report on Friday, May 23rd. Barclays lifted their target price on shares of MGIC Investment from $26.00 to $27.00 and gave the company an "equal weight" rating in a report on Tuesday, July 8th. Finally, Keefe, Bruyette & Woods lifted their target price on shares of MGIC Investment from $26.00 to $27.00 and gave the company a "market perform" rating in a report on Monday, July 7th.

Insider Activity at MGIC Investment

In related news, EVP Paula C. Maggio sold 20,000 shares of the business's stock in a transaction dated Friday, May 30th. The stock was sold at an average price of $26.49, for a total value of $529,800.00. Following the transaction, the executive vice president owned 157,395 shares in the company, valued at $4,169,393.55. The trade was a 11.27% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available at the SEC website. Also, CEO Timothy J. Mattke sold 139,203 shares of the business's stock in a transaction that occurred on Thursday, August 7th. The shares were sold at an average price of $26.54, for a total value of $3,694,447.62. Following the completion of the transaction, the chief executive officer directly owned 1,100,994 shares in the company, valued at approximately $29,220,380.76. The trade was a 11.22% decrease in their position. The disclosure for this sale can be found here. Insiders have sold 189,203 shares of company stock worth $5,010,848 in the last quarter. Company insiders own 1.05% of the company's stock.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently bought and sold shares of MTG. True Wealth Design LLC grew its stake in shares of MGIC Investment by 262.5% during the 2nd quarter. True Wealth Design LLC now owns 1,004 shares of the insurance provider's stock worth $28,000 after purchasing an additional 727 shares during the period. WPG Advisers LLC acquired a new position in MGIC Investment during the first quarter worth about $26,000. Hantz Financial Services Inc. grew its position in MGIC Investment by 3,067.6% during the second quarter. Hantz Financial Services Inc. now owns 1,077 shares of the insurance provider's stock worth $30,000 after buying an additional 1,043 shares during the period. Employees Retirement System of Texas acquired a new position in MGIC Investment during the second quarter worth about $32,000. Finally, Mitsubishi UFJ Asset Management Co. Ltd. grew its position in MGIC Investment by 118.0% during the second quarter. Mitsubishi UFJ Asset Management Co. Ltd. now owns 1,308 shares of the insurance provider's stock worth $36,000 after buying an additional 708 shares during the period. Institutional investors and hedge funds own 95.58% of the company's stock.

MGIC Investment Price Performance

Shares of NYSE:MTG opened at $27.5250 on Friday. The company's fifty day moving average price is $26.76 and its 200 day moving average price is $25.48. MGIC Investment has a 12 month low of $21.94 and a 12 month high of $28.67. The company has a debt-to-equity ratio of 0.13, a current ratio of 1.46 and a quick ratio of 1.46. The firm has a market capitalization of $6.35 billion, a P/E ratio of 9.02, a P/E/G ratio of 1.99 and a beta of 0.90.

MGIC Investment (NYSE:MTG - Get Free Report) last posted its earnings results on Wednesday, July 30th. The insurance provider reported $0.82 EPS for the quarter, topping analysts' consensus estimates of $0.70 by $0.12. MGIC Investment had a return on equity of 14.73% and a net margin of 62.58%.The business had revenue of $304.25 million for the quarter, compared to analysts' expectations of $306.25 million. During the same quarter in the previous year, the firm earned $0.77 earnings per share. The business's revenue was down .3% compared to the same quarter last year. As a group, sell-side analysts predict that MGIC Investment will post 2.71 earnings per share for the current fiscal year.

MGIC Investment Increases Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Thursday, August 21st. Shareholders of record on Thursday, August 7th were paid a $0.15 dividend. This is a boost from MGIC Investment's previous quarterly dividend of $0.13. This represents a $0.60 dividend on an annualized basis and a yield of 2.2%. The ex-dividend date was Thursday, August 7th. MGIC Investment's dividend payout ratio (DPR) is presently 19.67%.

MGIC Investment declared that its board has approved a share repurchase plan on Thursday, April 24th that allows the company to repurchase $750.00 million in outstanding shares. This repurchase authorization allows the insurance provider to repurchase up to 12.5% of its stock through open market purchases. Stock repurchase plans are usually an indication that the company's board believes its stock is undervalued.

About MGIC Investment

MGIC Investment Corporation, through its subsidiaries, provides private mortgage insurance, other mortgage credit risk management solutions, and ancillary services to lenders and government sponsored entities in the United States, the District of Columbia, Puerto Rico, and Guam. The company offers primary mortgage insurance that provides mortgage default protection on individual loans, as well as covers unpaid loan principal, delinquent interest, and various expenses associated with the default and subsequent foreclosure.

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