Why Is MGIC (MTG) Down 3.7% Since Last Earnings Report?

It has been about a month since the last earnings report for MGIC Investment (MTG). Shares have lost about 3.7% 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 MGIC due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.

MGIC Q1 Earnings Beat, Revenues Miss Estimates, Premiums Down Y/Y

MGIC Investment Corporation reported first-quarter 2026 operating net income per share of 76 cents, which beat the Zacks Consensus Estimate by 4.1%. The bottom line also improved 1.3% year over year. Total operating revenues declined 3% year over year to $297 million, attributable to lower net premiums earned and other revenues. The top line missed the Zacks Consensus Estimate by 1.4%. The quarterly results reflected stable investment income, partially offset by lower net premiums earned and other revenues.

Operational Update

Insurance in force increased 3% year over year to $302.7 billion, exceeding the Zacks Consensus Estimate of $293.7 billion as well as our estimate of $295.6 billion. Meanwhile, primary delinquency rose 6.2% to 27,006 loans during the quarter. Net premiums earned declined 3.4% year over year to $235.4 million, surpassing our estimate of $234.3 million. Meanwhile, net investment income increased 0.5% year over year to $61.7 million, but came in below our estimate of $61.8 million and the Zacks Consensus Estimate of $62.4 million.

Persistency, the percentage of insurance remaining in force, was 84% as of March 31, 2026, and declined 70 basis points from the year-ago quarter’s level. Meanwhile, new insurance written increased 41.5% year over year to $14.4 billion. Underwriting and other expenses, net, declined 9.4% year over year to $48.1 million. However, underwriting performance weakened materially, with the loss ratio surging to 14.1% from 3.9% in the prior-year quarter.

Total losses and expenses increased 26.1% year over year to $90.2 million, attributable to a sharp rise in losses incurred, net, which nearly doubled from the year-ago period.

Financial Update

Book value per share, a measure of net worth, increased 10.4% year over year to $23.63 as of March 31, 2026. Shareholder equity was $5.3 billion as of March 31, 2026, down 2.1% from the 2025-end level. MGIC Investment's PMIERs Available Assets totaled $5.8 billion, or $2.9 billion above its Minimum Required Assets as of March 31, 2026. Total assets were $6.4 billion as of March 31, 2026, down 4.4% from the 2025-end level. Senior notes totaled $646.5 million as of March 31, 2026, reflecting a 0.1% increase from the 2025-end level.

Capital Deployment

The company repurchased 7.2 million shares of common stock for $192.6 million and paid a dividend of $400 million to the holding company. MGIC also paid a dividend of 15 cents per common share to shareholders. In January, the company executed an insurance-linked note transaction, that covers certain policies written between Jan. 1, 2022, and March 31, 2025.

MTG  bought back shares worth $47.4 million in April 2026. The board approved a dividend of 15 cents per common share payable in May 21 to shareholders of record on May 3, 2026. Concurrently, the board of directors also approved a share repurchase program, authorizing MTG to repurchase an additional $750 million of common stock through Dec. 31, 2028.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.

VGM Scores

At this time, MGIC has a poor Growth Score of F, a grade with the same score on the momentum front. However, the stock was allocated a score of B on the value side, putting it in the second quintile for this investment strategy.

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

MGIC has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

MGIC is part of the Zacks Insurance - Multi line industry. Over the past month, Principal Financial (PFG), a stock from the same industry, has gained 2.4%. The company reported its results for the quarter ended March 2026 more than a month ago.

Principal Financial reported revenues of $3.52 billion in the last reported quarter, representing a year-over-year change of -12.4%. EPS of $2.07 for the same period compares with $1.81 a year ago.

For the current quarter, Principal Financial is expected to post earnings of $2.33 per share, indicating a change of +7.9% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.4% over the last 30 days.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Principal Financial. Also, the stock has a VGM Score of C.

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This article originally published on Zacks Investment Research (zacks.com).

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