MGIC Investment Corporation
MGIC Investment Corporation Fundamental Analysis
MGIC Investment Corporation (MTG) shows moderate financial fundamentals with a PE ratio of 7.72, profit margin of 59.63%, and ROE of 14.00%. The company generates $1.2B in annual revenue with weak year-over-year growth of 0.49%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 63.1/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze MTG's fundamental strength across five key dimensions:
Efficiency Score
ExcellentMTG demonstrates superior asset utilization.
Valuation Score
ExcellentMTG trades at attractive valuation levels.
Growth Score
WeakMTG faces weak or negative growth trends.
Financial Health Score
ExcellentMTG maintains a strong and stable balance sheet.
Profitability Score
ModerateMTG maintains healthy but balanced margins.
Key Financial Metrics
Is MTG Expensive or Cheap?
P/E Ratio
MTG trades at 7.72 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, MTG's PEG of 1.95 indicates fair valuation.
Price to Book
The market values MGIC Investment Corporation at 1.10 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 5.34 times EBITDA. This is generally considered low.
How Well Does MTG Make Money?
Net Profit Margin
For every $100 in sales, MGIC Investment Corporation keeps $59.63 as profit after all expenses.
Operating Margin
Core operations generate 75.42 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $14.00 in profit for every $100 of shareholder equity.
ROA
MGIC Investment Corporation generates $11.19 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
MGIC Investment Corporation generates strong operating cash flow of $690.87M, reflecting robust business health.
Free Cash Flow
MGIC Investment Corporation generates strong free cash flow of $689.81M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $3.26 in free cash annually.
FCF Yield
MTG converts 12.93% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
7.72
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
1.95
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.10
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.51
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.13
vs 25 benchmark
Current Ratio
Current assets to current liabilities
10.40
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.14
vs 25 benchmark
ROA
Return on assets percentage
0.11
vs 25 benchmark
ROCE
Return on capital employed
0.16
vs 25 benchmark
How MTG Stacks Against Its Sector Peers
| Metric | MTG Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 7.72 | 18.91 | Better (Cheaper) |
| ROE | 14.00% | 810.00% | Weak |
| Net Margin | 59.63% | 1736.00% | Weak |
| Debt/Equity | 0.13 | 0.98 | Strong (Low Leverage) |
| Current Ratio | 10.40 | 621.89 | Strong Liquidity |
| ROA | 11.19% | -23442.00% (disorted) | Strong |
MTG outperforms its industry in 4 out of 6 key metrics, particularly excelling in ROA, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews MGIC Investment Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
52.43%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
149.26%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
75.38%
Industry Style: Value, Dividend, Cyclical
High Growth