Radian Group Reports Record Mortgage Insurance in Force, Strong Earnings Growth and Robust Capital Position

Radian Group Inc. reported Q2 net income of $142 million, a 12.5% return on equity, and a 12% YoY increase in book value per share. The company achieved a record $277 billion in primary mortgage insurance in force and maintained a strong persistency rate of 84%. However, the All Other segment experienced a $16.4 million adjusted pretax operating loss, and operating expenses increased to $89 million. Despite these challenges, Radian's forward-looking guidance remains optimistic, with projected growth in primary mortgage insurance in force and a continued decrease in operating expenses.

Radian Group Inc. (RDN) reported its second-quarter (Q2) earnings, highlighting significant financial achievements while also facing challenges in specific segments. The company reported a net income of $142 million, a 12.5% return on equity (ROE), and a 12% year-over-year (YoY) increase in book value per share to $33.18 [1]. The company's primary mortgage insurance in force reached an all-time high of $277 billion, reflecting strong future earnings potential. The persistency rate remained robust at 84%, indicating a high level of customer retention.

However, the All Other segment, which includes the Mortgage Conduit business, reported an adjusted pretax operating loss of approximately $16.4 million. This was driven by lower revenue and mark-to-market changes. Operating expenses increased to $89 million for the quarter, with a full-year expectation of $320 million. The company's available holding company liquidity decreased by approximately $50 million due to higher share repurchases.

Despite these challenges, Radian Group's forward-looking guidance remains optimistic. The company projects continued growth in primary mortgage insurance in force and a decrease in operating expenses. Additionally, the company repurchased approximately 13.5 million shares of common stock in the first half of 2025, enhancing shareholder value.

The company's strong cash flow visibility from Radian Guaranty, with $795 million expected to be brought up this year, positions it in a strong position to manage capital and liquidity moving forward. The company is focused on finding growth avenues and improving contributions from segments impacted by higher interest rates.

Overall, Radian Group's Q2 results demonstrate a mixed performance, with significant achievements in key areas offset by challenges in specific segments. The company's forward-looking guidance and strong liquidity position provide a foundation for future growth.

References:
[1] https://finance.yahoo.com/news/radian-group-inc-rdn-q2-072855875.html
[2] https://seekingalpha.com/article/4808051-radian-group-buyback-and-solid-results-make-shares-attractive