Essent Group (ESNT): Assessing Valuation After Strong Multi‑Year Returns and Recent Momentum Cooldown

Essent Group (ESNT) has quietly outperformed many financial names this year, with the stock up roughly 14% year to date even after a recent pullback. That disconnect between solid returns and softer near term momentum is worth unpacking.

See our latest analysis for Essent Group.

With the latest share price at $61.88, Essent’s roughly 13.6% year to date share price return sits alongside a 3-year total shareholder return of about 74.6%, suggesting momentum has cooled even as the longer term story remains intact.

If Essent’s steady compounding has you thinking about what else could outperform, this is a good moment to explore fast growing stocks with high insider ownership for fresh, fast growing ideas with skin in the game.

With earnings growth flattening but the shares still trading at a sizeable intrinsic discount and modest upside to analyst targets, is Essent quietly undervalued here, or are investors already pricing in its next leg of growth?

Most Popular Narrative Narrative: 8% Undervalued

With Essent Group’s fair value pegged at $67.25 against a $61.88 close, the narrative implies upside that hinges on disciplined execution and capital returns.

The company's expansion into adjacent credit risk management, through reinsurance (Essent Re) and advisory services, provides new and growing fee-based revenue streams, which support long-term earnings growth and diversification beyond traditional mortgage insurance.

Read the complete narrative.

Curious how modest revenue growth, easing margins, and aggressive buybacks can still add up to upside from here? The narrative’s math may surprise you.

Result: Fair Value of $67.25 (UNDERVALUED)

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

However, stretched housing affordability and potential shifts in Fannie and Freddie risk sharing could curb policy volumes, margins, and ultimately Essent’s upside narrative.

Find out about the key risks to this Essent Group narrative.

Build Your Own Essent Group Narrative

If you see Essent differently or want to stress test the numbers yourself, you can build a custom narrative in just minutes, Do it your way.

A great starting point for your Essent Group research is our analysis highlighting 2 key rewards and 2 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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