NYSE:RDN

Stock Analysis Report

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Executive Summary

Radian Group Inc., together with its subsidiaries, engages in the mortgage and real estate services business in the United States. More Details


Snowflake Analysis

Undervalued established dividend payer.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: RDN is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: RDN's weekly volatility has decreased from 12% to 5% over the past year.


Market Performance


7 Day Return

1.3%

RDN

23.3%

US Mortgage

-0.7%

US Market


1 Year Return

-8.3%

RDN

6.7%

US Mortgage

36.6%

US Market

Return vs Industry: RDN underperformed the US Mortgage industry which returned 6.7% over the past year.

Return vs Market: RDN underperformed the US Market which returned 36.6% over the past year.


Shareholder returns

RDNIndustryMarket
7 Day1.3%23.3%-0.7%
30 Day9.8%29.7%4.3%
90 Day7.9%38.4%8.1%
1 Year-5.6%-8.3%9.7%6.7%39.6%36.6%
3 Year3.2%-0.4%17.0%7.6%53.5%43.7%
5 Year85.8%79.1%75.6%50.6%123.7%98.8%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RDN ($21.08) is trading below our estimate of fair value ($51.65)

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


Price To Earnings Ratio

PE vs Industry: RDN is good value based on its PE Ratio (10.5x) compared to the US Mortgage industry average (13.5x).

PE vs Market: RDN is good value based on its PE Ratio (10.5x) compared to the US market (21.4x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: RDN's PB Ratio (0.9x) is in line with the US Mortgage industry average.


Next Steps

Future Growth

How is Radian Group forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

18.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RDN's forecast earnings growth (18.6% per year) is above the savings rate (2%).

Earnings vs Market: RDN's earnings (18.6% per year) are forecast to grow slower than the US market (19.8% per year).

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

Revenue vs Market: RDN's revenue is expected to decline over the next 3 years (-1.1% per year).

High Growth Revenue: RDN's revenue is forecast to decline over the next 3 years (-1.1% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RDN's Return on Equity is forecast to be low in 3 years time (11.7%).


Next Steps

Past Performance

How has Radian Group performed over the past 5 years?

18.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RDN has high quality earnings.

Growing Profit Margin: RDN's current net profit margins (27.4%) are lower than last year (44%).


Past Earnings Growth Analysis

Earnings Trend: RDN's earnings have grown by 18.3% per year over the past 5 years.

Accelerating Growth: RDN's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: RDN had negative earnings growth (-41.4%) over the past year, making it difficult to compare to the Mortgage industry average (7.2%).


Return on Equity

High ROE: RDN's Return on Equity (9.2%) is considered low.


Next Steps

Financial Health

How is Radian 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: RDN's Assets to Equity ratio (1.9x) is low.

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

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

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

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

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


Next Steps

Dividend

What is Radian Group current dividend yield, its reliability and sustainability?

2.37%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RDN's dividend (2.37%) is higher than the bottom 25% of dividend payers in the US market (1.32%).

High Dividend: RDN's dividend (2.37%) is low compared to the top 25% of dividend payers in the US market (3.72%).


Stability and Growth of Payments

Stable Dividend: RDN's dividends per share have been stable in the past 10 years.

Growing Dividend: RDN's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (24.8%), RDN's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RDN's dividends in 3 years are forecast to be well covered by earnings (20.3% payout ratio).


Next Steps

Management

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

5.3yrs

Average management tenure


CEO

Rick Thornberry (62 yo)

4yrs

Tenure

US$8,197,874

Compensation

Mr. Richard G. Thornberry, also known as Rick, is Chief Executive Officer of Radian Group Inc. He has more than 30 years of experience in the financial services industry, as a leader of some of the most in...


CEO Compensation Analysis

Compensation vs Market: Rick's total compensation ($USD8.20M) is above average for companies of similar size in the US market ($USD4.96M).

Compensation vs Earnings: Rick's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Richard Thornberry
CEO & Director4yrsUS$8.20m0.068%
$ 2.8m
J. Hall
Senior EVP & CFO6.17yrsUS$2.36m0.034%
$ 1.4m
Edward Hoffman
Senior EVP0.25yrUS$2.36m0.048%
$ 1.9m
Derek Brummer
President of Mortgage7.75yrsUS$2.80m0.068%
$ 2.8m
Brien McMahon
Senior EVPno dataUS$2.23m0.033%
$ 1.3m
William Tomljanovic
Chief Investment Officer8.25yrsno datano data
Robert Quigley
Executive VP2.33yrsno data0.0087%
$ 352.4k
Emily Riley
Executive VP8.08yrsno datano data
Mary Dickerson
Executive VP & Chief People Officer0.17yrno datano data
Clifford Rossi
Chief Economist & Senior VP6.08yrsno datano data
Peter Danna
Senior Vice President of Structured Products4.5yrsno datano data
Curtis Over
Senior Vice President of Product Developmentno datano datano data

5.3yrs

Average Tenure

52yo

Average Age

Experienced Management: RDN's management team is seasoned and experienced (5.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Richard Thornberry
CEO & Director4yrsUS$8.20m0.068%
$ 2.8m
Herbert Wender
Independent Non-Executive Chairman of the Board15.83yrsUS$513.00k0.10%
$ 4.1m
Howard Culang
Independent Director21.75yrsUS$275.63k0.0042%
$ 169.7k
Lisa Hess
Independent Director10.08yrsUS$264.38k0%
$ 0
Debra Hess
Independent Director2yrsUS$188.97k0%
$ 0
Lisa Mumford
Independent Director1.08yrsno data0.0014%
$ 57.0k
Brad Conner
Independent Director1.08yrsno datano data
Noel Spiegel
Independent Director10.08yrsUS$252.63k0.016%
$ 632.8k
Gaetano Muzio
Independent Director8.83yrsUS$256.03k0.0026%
$ 105.5k
Gregory Serio
Independent Director8.83yrsUS$264.38k0%
$ 0

8.8yrs

Average Tenure

62yo

Average Age

Experienced Board: RDN's board of directors are considered experienced (8.8 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: Insufficient data to determine if 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

Radian Group Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Radian Group Inc.
  • Ticker: RDN
  • Exchange: NYSE
  • Founded: 1977
  • Industry: Thrifts and Mortgage Finance
  • Sector: Banks
  • Market Cap: US$4.041b
  • Shares outstanding: 191.69m
  • Website: https://www.radian.biz

Number of Employees


Location

  • Radian Group Inc.
  • 1500 Market Street
  • Philadelphia
  • Pennsylvania
  • 19102
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RDNNYSE (New York Stock Exchange)YesCommon StockUSUSDOct 1992
RAGDB (Deutsche Boerse AG)YesCommon StockDEEUROct 1992
RAGXTRA (XETRA Trading Platform)YesCommon StockDEEUROct 1992

Biography

Radian Group Inc., together with its subsidiaries, engages in the mortgage and real estate services business in the United States. The company operates in two segments, Mortgage Insurance and Services. The...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/03/03 01:18
End of Day Share Price2021/03/02 00:00
Earnings2020/12/31
Annual Earnings2020/12/31


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.