Enact Holdings (ACT) AI Stock Analysis

• Market Cap: $5.57B
• Dividend Yield: 2.09%
• Average Volume (3M): 290.31K
• Price to Earnings (P/E): 8.6
• Beta (1Y): 0.56
• Revenue Growth: 3.15%
• EPS Growth: 5.70%
• Country: US
• Employees: 421
• Sector: Financial
• Sector Strength: 72
• Industry: Insurance - Specialty
• EPS (TTM): 1.15
• Shares Outstanding: 147,505,620
• 10 Day Avg. Volume: 245,211
• 30 Day Avg. Volume: 290,311
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.14
• Enterprise Value/Revenue: 5.21
• Enterprise Value/Gross Profit: 6.69
• Enterprise Value/Ebitda: 5.59
• 1Y Price Target: $41.00
• Price Target Upside: 8.75% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

• Rating: 84 Outperform
• Price Target: $44.00 ▲(16.71% Upside)

Enact Holdings receives a strong overall stock score of 84.3, driven primarily by its robust financial performance and attractive valuation. The company's solid balance sheet, zero debt reliance, and strong cash flows provide a stable foundation. Positive technical indicators and an optimistic earnings call further enhance the score, despite some challenges in the housing market and economic uncertainties.

Positive Factors

Credit Quality

Underwriting quality and credit quality of new business remains firmly in-check.

Reserve Management

ACT is seeing approximately 90% cure rates 12 months after default, which is driving reserve releases.

Valuation

Currently trading at approx. book value, the risk/reward for ACT is viewed as favorable.

Negative Factors

Market Challenges

Supply and affordability challenges remain, with the number of units for purchase transactions at 90’s levels highlighting the low level of transactions taking place.

Enact Holdings Business Overview & Revenue Model

Company Description

Enact Holdings, Inc. operates as a private mortgage insurance company in the United States. The company is involved in writing and assuming residential mortgage guaranty insurance. It offers private mortgage insurance products primarily insuring prime-based, individually underwritten residential mortgage loans; and contract underwriting services for mortgage lenders. The company was formerly known as Genworth Mortgage Holdings, Inc. and changed its name to Enact Holdings, Inc. in May 2021. Enact Holdings, Inc. was founded in 1981 and is headquartered in Raleigh, North Carolina. Enact Holdings, Inc. is a subsidiary of Genworth Holdings, Inc.

How the Company Makes Money

Enact Holdings generates revenue primarily through the sale of private mortgage insurance policies to mortgage lenders. These policies are typically required by lenders when borrowers are unable to make a down payment of at least 20% of the home's purchase price. The company earns premiums from these insurance policies, which constitute its primary revenue stream. Additionally, Enact Holdings may engage in reinsurance agreements to manage its risk exposure and optimize capital efficiency. Key factors contributing to its earnings include the volume of new insurance written, persistency of existing policies, and overall economic conditions affecting the housing and mortgage markets. The company also benefits from strategic partnerships with major lenders, which can enhance its distribution channels and market reach.

Enact Holdings Financial Statement Overview

Summary

Enact Holdings demonstrates strong financial performance with consistent revenue growth, high profit margins, zero reliance on debt, and substantial equity. The company's strong cash flows and financial stability position it well for future opportunities, despite the absence of EBITDA reporting.

Income Statement

Enact Holdings shows strong profitability with a consistent increase in Total Revenue from $1,156,686,000 in 2023 to $1,201,774,000 in 2024, representing a revenue growth of approximately 4.2%. The company maintains a high Gross Profit Margin of 100% due to zero cost of goods sold. Additionally, a Net Profit Margin of 57.2% in 2024 indicates robust profitability, supported by a consistent rise in EBIT Margin from 78.3% in 2023 to 82.2% in 2024. However, the absence of reported EBITDA figures could limit the comprehensive analysis of operational efficiency.

Balance Sheet

The balance sheet reflects a solid financial position with a Debt-to-Equity Ratio of 0 in 2024, demonstrating no reliance on debt financing. A Return on Equity (ROE) of 13.8% in 2024 underscores effective management in generating profits from shareholders’ equity. Additionally, an Equity Ratio of 76.6% suggests a strong equity base relative to total assets, which enhances financial stability and reduces financial risk.

Cash Flow

The cash flow statement indicates healthy cash generation with an Operating Cash Flow to Net Income Ratio of 1.0 in 2024, showing efficient conversion of net income into cash. A Free Cash Flow of $686,262,000 in 2024 demonstrates strong cash availability for reinvestment or shareholder returns. However, the Free Cash Flow Growth Rate is limited due to a high base effect from the prior year, indicating moderate growth potential in cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.22B	1.20B	1.15B	1.10B	1.12B	1.11B
Gross Profit	948.01M	943.06M	903.38M	949.75M	748.55M	1.11B
EBITDA	1.13B	929.22M	903.38M	949.92M	746.23M	490.66M
Net Income	692.86M	688.07M	665.51M	704.16M	546.68M	370.42M
Balance Sheet
Total Assets	6.72B	6.52B	6.19B	5.71B	5.87B	5.65B
Cash, Cash Equivalents and Short-Term Investments	6.45B	2.13B	5.90B	5.40B	5.69B	5.50B
Total Debt	743.40M	743.05M	745.42M	742.83M	740.42M	738.16M
Total Liabilities	1.60B	1.53B	1.56B	1.61B	1.76B	1.77B
Stockholders Equity	5.12B	5.00B	4.63B	4.10B	4.11B	3.88B
Cash Flow
Free Cash Flow	725.69M	686.26M	632.04M	567.13M	-113.53M	704.35M
Operating Cash Flow	725.69M	686.26M	632.04M	560.51M	572.12M	704.35M
Investing Cash Flow	-296.62M	-320.51M	-229.40M	-220.25M	-398.78M	-1.14B
Financing Cash Flow	-408.13M	-382.00M	-300.73M	-252.31M	-200.29M	300.30M

Enact Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 37.70
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ACT, the sentiment is Positive. The current price of 37.7 is above the 20-day moving average (MA) of 36.33, above the 50-day MA of 36.02, and above the 200-day MA of 34.29, indicating a bullish trend. The MACD of 0.64 indicates Negative momentum. The RSI at 62.60 is Neutral, neither overbought nor oversold. The STOCH value of 62.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ACT.

Enact Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ACT	84 Outperform	$5.57B	8.57	13.47%	2.09%	3.15%	5.70%
NMIH	83 Outperform	$3.04B	8.34	16.91%	―	9.99%	11.47%
ESNT	81 Outperform	$6.15B	9.11	12.94%	1.89%	4.79%	-0.76%
RDN	78 Outperform	$4.73B	8.78	13.07%	2.88%	0.24%	3.14%
MTG	75 Outperform	$6.33B	9.00	14.85%	1.96%	3.26%	12.70%
AGO	69 Neutral	$3.89B	8.89	8.38%	1.64%	5.89%	-27.45%
Sector *	64 Neutral	kr131.74B	8.59	6.07%	3.49%	9.27%	-30.01%

Enact Holdings Corporate Events

Enact Holdings Stockholders Approve Key Proposals

On May 14, 2025, Enact Holdings held its Annual Meeting of Stockholders where several key proposals were voted on. The election of directors to serve until the 2026 Annual Meeting saw all nominees receiving a majority of votes in favor, with Dominic J. Addesso and Michael A. Bless among those elected. Additionally, the advisory vote to approve Named Executive Officer compensation was passed with a significant majority, and the appointment of KPMG LLP as the independent registered public accounting firm for the 2025 fiscal year was ratified.