It has been about a month since the last earnings report for NMI Holdings (NMIH). Shares have lost about 9.5% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is NMI Holdings due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for NMI Holdings Inc before we dive into how investors and analysts have reacted as of late.
NMI Holdings Q4 Earnings Beat, Primary Insurance in Force Rises Y/Y
NMI Holdings reported fourth-quarter 2025 operating net income per share of $1.20, which beat the Zacks Consensus Estimate by 2.6%. The bottom line increased 12.1% year over year.
The quarterly results reflected higher premiums earned, improved net investment income and consistent growth in the high-quality insured portfolio. These were offset by lower persistency.
Operational Update
NMI Holdings’ total operating revenues of $181 million increased 8.4% year over year on higher net premiums earned (up 6.3%) and net investment income (up 21%). Revenues beat the Zacks Consensus Estimate by about 1%.
Primary insurance in force increased 5.1% year over year to $221 billion. Our estimate was $213.4 billion while the consensus estimate was $218 billion.
Annual persistency was 83.4%, down 30 basis points (bps) year over year.
New insurance written was $14.2 billion, up 19.1% year over year.
Underwriting and operating expenses totaled $31.1 million, flat year over year.
Insurance claims and claim expenses were $21.2 million, which surged 22.5% year over year.
The loss ratio was 13.9, which deteriorated 190 bps. The adjusted expense ratio of 19.3 improved 100 bps year over year, while the adjusted combined ratio of 21.4 improved 130 bps.
Full-Year Highlights
Operating net income per share was $4.92, up 11.1% year over year. The bottom line beat the Zacks Consensus Estimate of $4.89.
Operating revenues were $706 million, up 8% year over year. The top line beat the Zacks Consensus Estimate of $704.7 million.
Combined ratio deteriorated 290 bps.
Financial Update
Book value per share, a measure of net worth, was up 20.4% year over year to $33.98 as of Dec. 31, 2025.
NMI Holdings had $43.9 million in cash and cash equivalents, down 19.1% from the 2024 end level.
The debt balance of $416.5 million increased 0.5% from the end of 2024.
The annualized adjusted return on equity was 14.7%, which contracted 90 bps year over year. Total PMIERs available assets were $3.5 billion.
Net risk-based required assets totaled $2.1 billion at the end of fourth-quarter 2025.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
VGM Scores
Currently, NMI Holdings has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. However, the stock has a score of B on the value side, putting it in the second quintile for value investors.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, NMI Holdings has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
NMI Holdings is part of the Zacks Insurance - Property and Casualty industry. Over the past month, Cincinnati Financial (CINF), a stock from the same industry, has gained 0.3%. The company reported its results for the quarter ended December 2025 more than a month ago.
Cincinnati Financial reported revenues of $2.91 billion in the last reported quarter, representing a year-over-year change of +9.6%. EPS of $3.37 for the same period compares with $3.14 a year ago.
For the current quarter, Cincinnati Financial is expected to post earnings of $1.96 per share, indicating a change of +916.7% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.7% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Cincinnati Financial. Also, the stock has a VGM Score of C.
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This article originally published on Zacks Investment Research (zacks.com).