MTG - MGIC Investment Corporation: Strong Buy At 84% Of Book Value

Summary

• MGIC Investment Corporation is one of the leading mortgage insurance companies in the United States.
• The stock trades at just 84% of book, pays a 3.14% dividend and is buying back stock strategically while reducing debt.
• Losses are likely to increase, but the company has conservatively reduced risk using reinsurance and should remain solidly profitable even during a recession.
• MTG has generated average ROEs in the teens over the last 6 years and should be able to continue that average over the business cycle.

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