NasdaqGM:NMIH

Stock Analysis Report

Executive Summary

NMI Holdings, Inc., through its subsidiaries, provides private mortgage guaranty insurance services in the United States.

Rewards

Trading at 46.6% below its fair value

Earnings are forecast to grow 21.82% per year

Earnings grew by 122.7% over the past year

Risk Analysis

Shareholders have been diluted in the past year



Snowflake Analysis

Solid track record with high growth potential.


Similar Companies

Share Price & News

How has NMI Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NMIH has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.4%

NMIH

-0.5%

US Mortgage

0.8%

US Market


1 Year Return

81.7%

NMIH

22.4%

US Mortgage

17.8%

US Market

Return vs Industry: NMIH exceeded the US Mortgage industry which returned 22.4% over the past year.

Return vs Market: NMIH exceeded the US Market which returned 17.8% over the past year.


Shareholder returns

NMIHIndustryMarket
7 Day2.4%-0.5%0.8%
30 Day0.4%-1.1%1.8%
90 Day27.7%3.8%4.1%
1 Year81.7%81.7%25.1%22.4%20.4%17.8%
3 Year237.3%237.3%25.7%16.9%45.9%36.4%
5 Year276.9%276.9%71.8%53.2%68.1%49.6%

Price Volatility Vs. Market

How volatile is NMI Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is NMI Holdings undervalued compared to its fair value and its price relative to the market?

46.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: NMIH ($33.73) is trading below our estimate of fair value ($63.18)

Significantly Below Fair Value: NMIH is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: NMIH is poor value based on its PE Ratio (14.4x) compared to the Mortgage industry average (14.4x).

PE vs Market: NMIH is good value based on its PE Ratio (14.4x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: NMIH is good value based on its PEG Ratio (0.7x)


Price to Book Ratio

PB vs Industry: NMIH is overvalued based on its PB Ratio (2.6x) compared to the US Mortgage industry average (1.1x).


Next Steps

Future Growth

How is NMI Holdings forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

21.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NMIH's forecast earnings growth (21.8% per year) is above the savings rate (1.7%).

Earnings vs Market: NMIH's earnings (21.8% per year) are forecast to grow faster than the US market (14.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: NMIH's revenue (17.9% per year) is forecast to grow faster than the US market (7.4% per year).

High Growth Revenue: NMIH's revenue (17.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NMIH's Return on Equity is forecast to be high in 3 years time (20%)


Next Steps

Past Performance

How has NMI Holdings performed over the past 5 years?

64.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NMIH has high quality earnings.

Growing Profit Margin: NMIH's current net profit margins (44.9%) are higher than last year (27.9%).


Past Earnings Growth Analysis

Earnings Trend: NMIH has become profitable over the past 5 years, growing earnings by 64.8% per year.

Accelerating Growth: NMIH's earnings growth over the past year (122.7%) exceeds its 5-year average (64.8% per year).

Earnings vs Industry: NMIH earnings growth over the past year (122.7%) exceeded the Mortgage industry 23.1%.


Return on Equity

High ROE: NMIH's Return on Equity (18%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is NMI Holdings's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: NMIH has a low level of unsold assets or inventory.

Debt Coverage by Assets: NMIH's debt is covered by short term assets (assets are 1.2x debt).


Financial Institutions Analysis

Asset Level: NMIH's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if NMIH has a sufficient allowance for bad loans.

Low Risk Liabilities: NMIH reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if NMIH has an acceptable proportion of non-loan assets held.

Low Risk Deposits: NMIH has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if NMIH has an appropriate level of bad loans.


Next Steps

Dividend

What is NMI Holdings's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage2.7%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate NMIH's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate NMIH's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if NMIH's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if NMIH's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of NMIH's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of NMI Holdings's salary, the management and board of directors tenure and is there insider trading?

2.2yrs

Average management tenure


CEO

Claudia Merkle (60yo)

0.9yrs

Tenure

US$2,248,411

Compensation

Ms. Claudia J. Merkle is Chief Executive Officer and Director of NMI Holdings, Inc since January 1, 2019. Ms. Merkle served as President of NMI Holdings, Inc since May 10, 2018 until 2018. Ms. Merkle has b ...


CEO Compensation Analysis

Compensation vs Market: Claudia's total compensation ($USD2.25M) is below average for companies of similar size in the US market ($USD3.87M).

Compensation vs Earnings: Claudia's compensation has increased by more than 20% in the past year.


Management Age and Tenure

2.2yrs

Average Tenure

58.5yo

Average Age

Experienced Management: NMIH's management team is considered experienced (2.2 years average tenure).


Board Age and Tenure

7.4yrs

Average Tenure

64yo

Average Age

Experienced Board: NMIH's board of directors are considered experienced (7.4 years average tenure).


Insider Trading

Insider Buying: NMIH insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$169,06302 Dec 19
James Ozanne
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,000
Max PriceUS$33.81
SellUS$257,03926 Nov 19
William Leatherberry
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares7,674
Max PriceUS$33.49
SellUS$333,80320 Nov 19
Michael Embler
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares10,000
Max PriceUS$33.38
SellUS$1,697,12018 Nov 19
Bradley Shuster
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares50,000
Max PriceUS$33.94
SellUS$102,92818 Nov 19
Robert Smith
EntityIndividual
Role
Senior Key Executive
Executive VP & Chief Risk Officer
Shares3,000
Max PriceUS$34.31
SellUS$133,54914 Nov 19
James Jones
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares4,000
Max PriceUS$33.40
SellUS$592,50814 Nov 19
Adam Pollitzer
EntityIndividual
Role
Chief Financial Officer
CFO & Executive VP
Shares17,724
Max PriceUS$33.73
SellUS$426,93012 Nov 19
William Leatherberry
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares12,685
Max PriceUS$33.66
SellUS$139,40723 Sep 19
Greenrange Partners
EntityCompany
Shares5,000
Max PriceUS$27.88
SellUS$137,81723 Sep 19
James Ozanne
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,000
Max PriceUS$27.56
SellUS$135,06609 Sep 19
Adam Pollitzer
EntityIndividual
Role
Chief Financial Officer
CFO & Executive VP
Shares4,821
Max PriceUS$28.02
SellUS$347,18909 Sep 19
Bradley Shuster
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares12,500
Max PriceUS$27.78
SellUS$278,63229 Aug 19
James Ozanne
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares10,000
Max PriceUS$27.86
SellUS$349,67420 Aug 19
Bradley Shuster
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares12,500
Max PriceUS$28.02
SellUS$114,78603 Jun 19
Adam Pollitzer
EntityIndividual
Role
Chief Financial Officer
CFO & Executive VP
Shares4,092
Max PriceUS$28.05
SellUS$685,08814 May 19
Greenrange Partners
EntityCompany
Shares25,000
Max PriceUS$27.40
SellUS$129,19313 May 19
Steven Scheid
EntityIndividual
Role
Lead Director
Lead Director
Shares4,923
Max PriceUS$26.24
SellUS$337,87906 May 19
James Ozanne
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares12,000
Max PriceUS$28.16
SellUS$138,80706 May 19
Michael Embler
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,000
Max PriceUS$27.76
SellUS$409,83820 Mar 19
William Leatherberry
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares15,663
Max PriceUS$26.20
SellUS$289,44020 Mar 19
Julie Norberg
EntityIndividual
Shares11,146
Max PriceUS$26.17

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 5.7%.


Management Team

  • Brad Shuster (64yo)

    Executive Chairman

    • Tenure: 7.7yrs
    • Compensation: US$6.71m
  • Mike Dirrane (62yo)

    Chief Sales Officer & Senior MD

    • Tenure: 1.8yrs
  • Pat Mathis (59yo)

    Executive VP & COO

    • Tenure: 1.6yrs
    • Compensation: US$1.80m
  • Claudia Merkle (60yo)

    CEO & Director

    • Tenure: 0.9yrs
    • Compensation: US$2.25m
  • Bill Leatherberry (48yo)

    Executive VP

    • Tenure: 5.9yrs
    • Compensation: US$2.01m
  • Mary Sharp (58yo)

    Chief Human Resources Officer & Senior VP

    • Tenure: 3.8yrs
  • Nicholas Ondrejka

    Senior VP & Chief Information Officer

    • Tenure: 2.2yrs
  • John Swenson

    Vice President of Investor Relations & Treasury

    • Tenure: 4.9yrs
  • Adam Pollitzer (39yo)

    CFO & Executive VP

    • Tenure: 2.6yrs
    • Compensation: US$2.16m
  • Rob Smith (49yo)

    Executive VP & Chief Risk Officer

    • Tenure: 1.6yrs

Board Members

  • Steve Scheid (66yo)

    Lead Director

    • Tenure: 7.7yrs
    • Compensation: US$150.00k
  • Brad Shuster (64yo)

    Executive Chairman

    • Tenure: 7.7yrs
    • Compensation: US$6.71m
  • James Ozanne (76yo)

    Independent Director

    • Tenure: 7.7yrs
    • Compensation: US$150.00k
  • Mike Embler (55yo)

    Independent Director

    • Tenure: 7.4yrs
    • Compensation: US$150.00k
  • Jim Jones (70yo)

    Independent Director

    • Tenure: 7.4yrs
    • Compensation: US$150.00k
  • Claudia Merkle (60yo)

    CEO & Director

    • Tenure: 0.9yrs
    • Compensation: US$2.25m
  • Lynn McCreary (59yo)

    Director

    • Tenure: 0.6yrs
  • Michael Montgomery (64yo)

    Independent Director

    • Tenure: 7.4yrs
    • Compensation: US$150.00k
  • Regina Muehlhauser (70yo)

    Independent Director

    • Tenure: 2.8yrs
    • Compensation: US$150.00k

Company Information

NMI Holdings, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: NMI Holdings, Inc.
  • Ticker: NMIH
  • Exchange: NasdaqGM
  • Founded: 2011
  • Industry: Thrifts and Mortgage Finance
  • Sector: Banks
  • Market Cap: US$2.293b
  • Shares outstanding: 67.98m
  • Website: https://www.nationalmi.com

Number of Employees


Location

  • NMI Holdings, Inc.
  • 2100 Powell Street
  • 12th Floor
  • Emeryville
  • California
  • 94608
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NMIHNasdaqGM (Nasdaq Global Market)YesClass A Common StockUSUSDNov 2013
6NMDB (Deutsche Boerse AG)YesClass A Common StockDEEURNov 2013

Biography

NMI Holdings, Inc., through its subsidiaries, provides private mortgage guaranty insurance services in the United States. The company offers mortgage insurance; reinsurance on loans; and outsourced loan re ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/12 00:27
End of Day Share Price2019/12/11 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.