Enact Holdings (ACT): Evaluating Valuation After Recent Share Price Pullback

Enact Holdings (ACT) shares have seen moderate shifts lately, with the stock slipping nearly 9% over the past month but still up about 10% year to date. Recent trading activity puts a focus on its longer-term performance.

See our latest analysis for Enact Holdings.

Enact Holdings’ 9.5% year-to-date share price return suggests momentum has cooled recently, especially after a 30-day share price pullback and quiet trading sessions. However, the company’s three-year total shareholder return of nearly 75% stands out over the long term.

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With Enact Holdings trading below analyst price targets and showing a strong long-term return, investors might wonder if there is still unrealized value in the stock or if the market has already accounted for its future growth prospects.

Most Popular Narrative: 11.5% Undervalued

The narrative puts Enact Holdings’ fair value above the last close price, pointing to potential upside if underlying drivers win out. Let’s examine what could be powering this optimistic stance.

Persistent demographic tailwinds from millennial and Gen Z homebuyer demand, combined with a continued national supply-demand imbalance, are expected to support steady mortgage originations and boost Enact's insurance in force and premium volumes. This would directly benefit revenue and long-term earnings growth.

Read the complete narrative.

Want to know the real reason behind this bullish valuation? The analysts are betting big on resilient demand trends, future profits, and a profit multiple that sets the bar high. Which quantitative assumptions really drive these powerful forecasts? Only a deep dive reveals the bold numbers baked into this consensus narrative.

Result: Fair Value of $40 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistently high mortgage rates or falling home prices could quickly derail growth expectations and put future profitability at risk.

Find out about the key risks to this Enact Holdings narrative.

Build Your Own Enact Holdings Narrative

If you see things differently or would rather dig into the numbers firsthand, you can craft your own perspective in just a few minutes. Do it your way

A great starting point for your Enact Holdings research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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