NYSE:ESNT

Stock Analysis Report

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Executive Summary

Essent Group Ltd., through its subsidiaries, provides private mortgage insurance and reinsurance for mortgages secured by residential properties located in the United States.


Snowflake Analysis

Undervalued with proven track record.


Similar Companies

Share Price & News

How has Essent Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ESNT's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

9.7%

ESNT

2.5%

US Mortgage

3.0%

US Market


1 Year Return

-29.4%

ESNT

-12.9%

US Mortgage

9.9%

US Market

Return vs Industry: ESNT underperformed the US Mortgage industry which returned -12.9% over the past year.

Return vs Market: ESNT underperformed the US Market which returned 9.9% over the past year.


Shareholder returns

ESNTIndustryMarket
7 Day9.7%2.5%3.0%
30 Day27.1%4.7%8.2%
90 Day-29.0%-26.7%0.4%
1 Year-28.7%-29.4%-10.6%-12.9%12.4%9.9%
3 Year-5.1%-6.0%0.5%-6.7%31.0%22.3%
5 Year31.3%30.1%3.3%-7.9%58.1%40.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Essent Group undervalued compared to its fair value and its price relative to the market?

48.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ESNT ($33.05) is trading below our estimate of fair value ($64)

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


Price To Earnings Ratio

PE vs Industry: ESNT is good value based on its PE Ratio (5.6x) compared to the Mortgage industry average (11.1x).

PE vs Market: ESNT is good value based on its PE Ratio (5.6x) compared to the US market (15.7x).


Price to Earnings Growth Ratio

PEG Ratio: ESNT is good value based on its PEG Ratio (0.6x)


Price to Book Ratio

PB vs Industry: ESNT is overvalued based on its PB Ratio (1x) compared to the US Mortgage industry average (0.8x).


Next Steps

Future Growth

How is Essent Group forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

9.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ESNT's forecast earnings growth (9.4% per year) is above the savings rate (2.2%).

Earnings vs Market: ESNT's earnings (9.4% per year) are forecast to grow slower than the US market (22% per year).

High Growth Earnings: ESNT's earnings are forecast to grow, but not significantly.

Revenue vs Market: ESNT's revenue (7.9% per year) is forecast to grow slower than the US market (8.8% per year).

High Growth Revenue: ESNT's revenue (7.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ESNT's Return on Equity is forecast to be low in 3 years time (14.8%).


Next Steps

Past Performance

How has Essent Group performed over the past 5 years?

31.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ESNT has high quality earnings.

Growing Profit Margin: ESNT's current net profit margins (64.5%) are higher than last year (64.3%).


Past Earnings Growth Analysis

Earnings Trend: ESNT's earnings have grown significantly by 31% per year over the past 5 years.

Accelerating Growth: ESNT's earnings growth over the past year (19.3%) is below its 5-year average (31% per year).

Earnings vs Industry: ESNT earnings growth over the past year (19.3%) exceeded the Mortgage industry 4.5%.


Return on Equity

High ROE: ESNT's Return on Equity (18.6%) is considered low.


Next Steps

Financial Health

How is Essent Group'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


Financial Institutions Analysis

Asset Level: ESNT's Assets to Equity ratio (1.3x) is low.

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

Low Risk Liabilities: ESNT reports no customer deposits, 100% of its liabilities are made up of higher risk sources of funding.

Loan Level: Insufficient data to determine if ESNT has an appropriate level of Loans to Assets ratio.

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

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


Next Steps

Dividend

What is Essent Group's current dividend yield, its reliability and sustainability?

1.94%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: ESNT's dividend (1.94%) is higher than the bottom 25% of dividend payers in the US market (1.69%).

High Dividend: ESNT's dividend (1.94%) is low compared to the top 25% of dividend payers in the US market (4.54%).


Stability and Growth of Payments

Stable Dividend: Too early to tell whether ESNT's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if ESNT's dividend payments are increasing as they only just started paying a dividend.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (7.8%), ESNT's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ESNT's dividends in 3 years are forecast to be thoroughly covered by earnings (11.6% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

11.4yrs

Average management tenure


CEO

Mark Casale (54yo)

12.42yrs

Tenure

US$8,056,425

Compensation

Mr. Mark Anthony Casale has been the Chief Executive Officer of Essent US Holdings, Inc. since 2008 and serves as its President. Mr. Casale serves as Chairman, Chief Executive Officer and President at Esse ...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD8.06M) is above average for companies of similar size in the US market ($USD5.91M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Mark Casale
Chairman12.42yrsUS$8.06m1.73% $56.4m
Lawrence McAlee
Senior VP & CFO11.42yrsUS$1.71m0.19% $6.3m
Christopher Curran
Senior Vice President of Corporate Developmentno dataUS$1.88m0.16% $5.2m
Vijay Bhasin
Chief Risk Officer & Senior VP11.42yrsUS$2.13m0.17% $5.7m
Jeffrey Cashmer
Senior VP & Chief Business Officerno dataUS$2.01m0.12% $3.8m
William Kaiser
Senior VP & Chief Operations Officerno datano datano data
David Weinstock
Chief Accounting Officer & VP11.42yrsno datano data
Theodore Gray
Senior VP & Chief Information Officerno datano datano data
Mary Gibbons
Senior VP & Chief Legal Officer12.42yrsUS$1.62m0.22% $7.2m
Joseph Hissong
Senior Vice President5.08yrsUS$1.60m0.049% $1.6m

11.4yrs

Average Tenure

54yo

Average Age

Experienced Management: ESNT's management team is seasoned and experienced (11.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Mark Casale
Chairman12.42yrsUS$8.06m1.73% $56.4m
William Spiegel
Lead Independent Directorno dataUS$270.74k0.028% $916.6k
Robert Glanville
Independent Director12.42yrsUS$250.74k0.039% $1.3m
Roy Kasmar
Independent Director7.42yrsUS$255.74k0.025% $805.4k
Douglas Pauls
Independent Director6.5yrsUS$255.74k0.028% $899.0k
Angela Heise
Independent Director2.08yrsUS$230.74k0.0058% $187.7k
Aditya Dutt
Independent Director10.42yrsUS$230.74k0.028% $916.6k
Jane Chwick
Independent Director2.08yrsUS$230.74k0.0058% $187.7k

7.4yrs

Average Tenure

55yo

Average Age

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


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: ESNT insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Essent Group Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Essent Group Ltd.
  • Ticker: ESNT
  • Exchange: NYSE
  • Founded: 2008
  • Industry: Thrifts and Mortgage Finance
  • Sector: Banks
  • Market Cap: US$3.260b
  • Shares outstanding: 98.62m
  • Website: https://www.essentgroup.com

Number of Employees


Location

  • Essent Group Ltd.
  • Clarendon House
  • 2 Church Street
  • Hamilton
  • HM 11
  • Bermuda

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ESNTNYSE (New York Stock Exchange)YesCommon SharesUSUSDNov 2013
0U95LSE (London Stock Exchange)YesCommon SharesGBUSDNov 2013

Biography

Essent Group Ltd., through its subsidiaries, provides private mortgage insurance and reinsurance for mortgages secured by residential properties located in the United States. Its mortgage insurance products include primary, pool, and master policy. The company also provides information technology maintenance and development services; customer support-related services; and contract underwriting services. It serves the originators of residential mortgage loans, such as regulated depository institutions, mortgage banks, credit unions, and other lenders. The company was founded in 2008 and is based in Hamilton, Bermuda. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/01 05:12
End of Day Share Price2020/05/29 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


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.