NYSE$RDN

Radian Group Inc · Q1 2020 earnings

Q1 2020 earnings · · Investor relations

Briefing

Radian reported strong operating results with increased book value and net income.

Radian Group Inc. reported a net income of $140.5 million, or $0.70 per diluted share, for the quarter ended March 31, 2020. Adjusted diluted net operating income per share increased 10% year-over-year to $0.80, and book value per share grew 16% year-over-year to $20.30.

  • Net income was $140.5 million, or $0.70 per diluted share.
  • Adjusted diluted net operating income per share increased 10% year-over-year to $0.80.
  • Book value per share grew 16% year-over-year to $20.30.
  • PMIERs Available Assets increased to $4.1 billion, with a $1.1 billion excess over Minimum Required Assets.

Headline financials

Total Revenue

$329M

Previous: $364M-9.5%
EPS (adj)

$0.80

Previous: $0.73+9.6%
Net premiums earned

$275M

Previous: $262M+5.0%
Holding company liquidity

$648M

Previous: $723M-10.4%
New defaults

10.0K

Previous: 10.2K-2.5%
Capital Expenditures

-$4.95M

Previous: -$6.66M+25.7%
Free Cash Flow

$136M

Previous: $164M-17.5%
Net Income

$140M

Previous: $171M-17.8%
Operating Income

$138M

Previous: $186M-25.9%
Gross Profit

$286M

Previous: $339M-15.8%
Cash & Equivalents

$54.1M

Previous: $119M-54.4%
Total Assets

$6.69B

Previous: $6.6B+1.4%

Revenue & EPS history

Radian · Revenue · Quarterly

$329M

Q1 2020-9.5%vs Q1 2019
Beat estimate in 12 of 16 quarters(75%)
ActualEstimate

Revenue by segment

Radian · $315M total across 1 segment · Q1 2020

  • Mortgage Insurance
    $315M+4.2%

Forward guidance

Radian anticipates that the COVID-19 pandemic will negatively impact its business and financial results in the second quarter of 2020 and in future periods.

Tailwinds

  • Successfully activated business continuity plans to transition to a virtual work environment.
  • Connected with employees and customers through phone and web-based meetings versus in-person.
  • Increased the company’s risk-based pricing and made adjustments to underwriting guidelines to account for the increased risk and uncertainty in the market while supporting customers with competitive rates.
  • Aligned its businesses with the temporary underwriting and servicing guidelines announced by the GSEs.
  • Supported Radian’s communities through increased matching gift levels and charitable contributions focused on first responders and healthcare workers.

Headwinds

  • The COVID-19 pandemic has significantly impacted the global economy.
  • The pandemic has disrupted global supply chains.
  • The pandemic has lowered equity market valuations.
  • The pandemic has created significant volatility and disruption in financial markets.
  • The pandemic has disrupted the housing finance system and real estate markets and increased unemployment levels.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2020

Historical avgQ1 2020

+0.0%

Avg return

Earnings day

+0.4%

Avg return

5 days after

+0.8%

Avg return

30 days after

48%

31 / 65 earnings

Positive

+19.2%

Q2 2011

Best reaction

-18.8%

Q3 2010

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-4.0%-2.6%-10.2%
Q4 2025+1.6%+6.3%+0.5%
Q3 2025-0.7%+3.0%+1.2%
Q1 2025+1.9%+5.1%+6.9%
Q4 2024-1.8%-4.8%-6.3%
Q3 2024+4.6%+5.8%+7.0%
Q2 2024-4.2%-8.7%-2.7%
Q1 2024+2.9%+4.8%+4.6%
Q4 2023-4.5%-2.1%+3.2%
Q3 2023+4.6%+6.6%+1.9%
Q2 2023+2.0%+4.0%+1.1%
Q1 2023+2.1%+5.9%+11.3%
Q4 2022-1.7%-1.1%-5.4%
Q3 2022-1.7%-0.8%-8.8%
Q2 2022+0.8%+0.0%-5.6%
Q1 2022+3.9%+0.1%-1.2%
Q4 2021+2.1%+2.4%-2.4%
Q3 2021-7.6%-6.8%-14.0%
Q2 2021-2.1%+2.5%+4.3%
Q1 2021-4.8%-4.5%-7.3%
Q4 2020-1.2%-1.0%+6.9%
Q3 2020-5.1%-2.6%+5.7%
Q2 2020+3.8%+4.7%+5.1%
Q1 2020+8.8%+6.0%+31.4%
Q4 2019-1.1%-3.0%-11.7%
Q3 2019+1.0%+1.0%+4.0%
Q2 2019-3.4%-7.0%-3.8%
Q1 2019+1.6%+2.4%-3.7%
Q4 2018-1.2%+1.3%+2.9%
Q3 2018+5.3%+3.8%+0.3%
Q2 2018+4.8%+8.2%+15.0%
Q1 2018-0.6%+3.5%+7.6%
Q4 2017+1.7%-2.0%-6.3%
Q3 2017+4.4%+3.3%+3.0%
Q2 2017+1.5%+0.9%+0.5%
Q1 2017-12.7%-14.3%-14.4%
Q4 2016-1.7%-0.3%+1.0%
Q3 2016-4.5%-7.8%+1.3%
Q2 2016+4.6%+1.5%+10.3%
Q1 2016+3.8%
Q4 2015+3.1%
Q3 2015-11.5%
Q2 2015-1.0%
Q1 2015-2.7%
Q4 2014-3.6%
Q3 2014+8.8%
Q2 2014+5.3%
Q1 2014+3.7%
Q4 2013+6.1%
Q3 2013-10.5%
Q2 2013+1.7%
Q1 2013-0.5%
Q4 2012+2.7%
Q3 2012+14.7%
Q2 2012+4.7%
Q1 2012+0.0%
Q4 2011-1.9%
Q4 2009-1.9%
Q3 2011-18.8%
Q3 2010-18.8%
Q2 2011+19.2%
Q2 2010-0.2%
Q1 2010-0.2%
Q4 2010-0.2%
Q1 2011-0.2%

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