Radian Group (RDN) AI Stock Analysis

• Market Cap: $4.81B
• Dividend Yield: 2.84%
• Average Volume (3M): 822.75K
• Price to Earnings (P/E): 8.8
• Beta (1Y): 0.78
• Revenue Growth: 0.24%
• EPS Growth: 3.14%
• Country: US
• Employees: 1,000
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Specialty
• EPS (TTM): 1.01
• Shares Outstanding: 135,450,440
• 10 Day Avg. Volume: 682,990
• 30 Day Avg. Volume: 822,745
• PEG Ratio: 2.03
• Price to Book (P/B): 1.05
• Price to Sales (P/S): 3.75
• P/FCF Ratio: -7.25
• Enterprise Value/Market Cap: 1.42
• Enterprise Value/Revenue: 5.33
• Enterprise Value/Gross Profit: 5.59
• Enterprise Value/Ebitda: 9.66
• 1Y Price Target: $37.00
• Price Target Upside: 4.20% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

• Rating: 78 Outperform
• Price Target: ―

Radian Group's robust financial performance and attractive valuation metrics are key strengths. The technical indicators suggest a stable but cautious outlook, while strategic corporate actions and a positive earnings call contribute to the stock's overall positive potential. However, market volatility and challenges in new insurance origination warrant careful monitoring.

Positive Factors

Strong Financial Performance

Strong financial performance with high return on equity indicates effective management and profitability, supporting long-term growth.

Innovative Reinsurance Structure

Innovative reinsurance structures enhance risk management and financial stability, providing a competitive edge in the insurance market.

Leadership Transition

The leadership transition to a prepared and experienced executive ensures continuity and strategic focus, bolstering long-term business stability.

Negative Factors

Challenges in New Insurance Written

A decline in new insurance written reflects challenges in market demand, potentially impacting future revenue growth and market share.

Decline in Investment Income

Reduced investment income can limit financial flexibility and profitability, affecting the company's ability to reinvest in growth opportunities.

Market Volatility Concerns

Market volatility poses risks to financial stability and strategic planning, potentially affecting long-term performance and investor confidence.

Radian Group Business Overview & Revenue Model

Company Description

Radian Group Inc., together with its subsidiaries, engages in the mortgage and real estate services business in the United States. Its Mortgage segment offers credit-related insurance coverage primarily through private mortgage insurance on residential first-lien mortgage loans, as well as other credit risk management, contract underwriting, and fulfillment solutions. This segment primarily serves mortgage originators, such as mortgage banks, commercial banks, savings institutions, credit unions, and community banks. The company's Homegenius segment offers title services, including a suite of insurance and non-insurance title, tax and title data, centralized recording, document retrieval and default curative title services, and deed and property reports, as well as closing and settlement services comprising electronic execution and traditional signing services; real estate valuation products and services; and asset management services, as well as a suite of real estate technology products and services to facilitate real estate transactions, such as software as a service solutions. This segment serves consumers, mortgage lenders, mortgage and real estate investors, government-sponsored enterprises, and real estate brokers and agents. The company was founded in 1977 and is headquartered in Wayne, Pennsylvania.

How the Company Makes Money

Radian Group generates revenue primarily through its mortgage insurance segment. The company earns premiums from providing private mortgage insurance to lenders, which is paid on a monthly or upfront basis by the borrower or the lender. This insurance protects lenders from potential losses if a borrower defaults on a loan. Additionally, Radian earns revenue from its Services segment, which includes real estate and title services, and flood insurance. These services cater to lenders, investors, and government-sponsored enterprises, and provide a diverse revenue stream beyond traditional mortgage insurance. The company's earnings are influenced by factors such as the volume of new insurance written, the performance of insured loans, and the overall health of the housing market. Strategic partnerships with financial institutions and participation in government programs also play a role in Radian's revenue generation.

Radian Group Financial Statement Overview

Summary

Radian Group is financially solid, with strengths in profitability and cash management. While revenue and profit growth are positive, the lack of detailed operational performance metrics suggests potential areas for transparency improvement. The balance sheet is stable, albeit with potential for more efficient asset utilization.

Income Statement

Radian Group shows a strong gross profit margin with consistent revenue growth over the years. However, the absence of EBIT and EBITDA figures in the latest year reduces visibility into operational efficiency. The net profit margin is healthy, indicating effective cost management.

Balance Sheet

The company maintains a solid equity base with a moderate debt-to-equity ratio, indicative of prudent financial leverage. However, there is room for improvement in terms of asset utilization efficiency, as evidenced by a stable return on equity.

Cash Flow

Radian Group demonstrates robust cash flow generation with positive operating cash flow and free cash flow. The free cash flow to net income ratio is strong, reflecting effective cash management practices. However, the decline in operating cash flow compared to previous years is a point of concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.29B	1.29B	1.24B	1.19B	1.33B	1.44B
Gross Profit	1.22B	1.27B	854.52M	727.22M	902.53M	1.07B
EBITDA	708.51M	953.78M	0.00	0.00	0.00	0.00
Net Income	586.54M	604.44M	603.12M	742.93M	600.67M	393.63M
Balance Sheet
Total Assets	9.54B	8.66B	7.59B	7.06B	7.84B	7.95B
Cash, Cash Equivalents and Short-Term Investments	22.09M	5.64B	5.87B	5.48B	6.22B	6.43B
Total Debt	1.83B	2.34B	1.58B	1.57B	1.56B	1.58B
Total Liabilities	5.09B	4.04B	3.20B	3.14B	3.58B	3.66B
Stockholders Equity	4.49B	4.62B	4.40B	3.92B	4.26B	4.28B
Cash Flow
Free Cash Flow	-758.92M	-666.75M	513.15M	370.63M	544.51M	641.42M
Operating Cash Flow	-1.15B	-663.57M	529.43M	388.30M	557.11M	658.43M
Investing Cash Flow	633.49M	327.75M	-300.84M	-5.17M	-1.86M	-883.18M
Financing Cash Flow	525.78M	357.23M	-265.09M	-479.18M	-496.78M	222.62M

Radian Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 35.51
• 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 RDN, the sentiment is Positive. The current price of 35.51 is above the 20-day moving average (MA) of 34.85, above the 50-day MA of 34.28, and above the 200-day MA of 33.01, indicating a bullish trend. The MACD of 0.30 indicates Negative momentum. The RSI at 60.38 is Neutral, neither overbought nor oversold. The STOCH value of 51.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RDN.

Radian Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ACT	84 Outperform	$5.79B	8.79	13.47%	2.01%	3.15%	5.70%
NMIH	83 Outperform	$3.13B	8.56	16.91%	―	9.99%	11.47%
ESNT	81 Outperform	$6.24B	9.24	12.94%	1.91%	4.79%	-0.76%
RDN	78 Outperform	$4.81B	8.79	13.07%	2.84%	0.24%	3.14%
MTG	77 Outperform	$6.54B	9.30	14.85%	1.87%	3.26%	12.70%
AGO	72 Outperform	$3.96B	8.90	8.38%	1.60%	5.89%	-27.45%
Sector *	68 Neutral	$18.10B	11.52	9.93%	3.73%	9.70%	1.14%

Radian Group Corporate Events

Radian Group Announces Leadership Transition in 2025

Derek V. Brummer, President of Mortgage Insurance at Radian Group Inc., announced his retirement effective April 21, 2025, earlier than the previously planned date of July 3, 2025. Sumita Pandit, the current Senior Executive Vice President and Chief Financial Officer, will assume the role of President and CFO, overseeing the company’s mortgage insurance business from April 21, 2025. This transition is a result of successful preparation and not due to any disagreements within the company.

Radian Group Expands Board with Reinsurance Expert

On February 10, 2025, Radian Group expanded its Board of Directors from eleven to twelve members by appointing Jed Rhoads, a seasoned reinsurance executive with over 40 years of experience, including senior roles at Markel Group. Rhoads’ extensive background in reinsurance aligns with Radian’s strategic goals, and his expertise is expected to enhance the Board’s capability to guide the company in transforming risk into opportunity.