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- **Resilient Earnings**: $164M net income with 13% ROE, despite 2% YoY in-force growth. 
- **Capital Return Focus**: $500M buybacks + dividend, despite 16.2% tax rate. 
- **Strong Balance Sheet**: $6.6B investments, 177% PMIERs, $1B holdco cash. 
- **MI Dominance**: 746 FICO, 93% LTV portfolio; 50%+ loans <5% rate support persistency. 
- **Strategic Patience**: Title insurance limited by rates; MI core with 12-14% ROE potential.

**【CEO Summary Section】**
- Reported net income of $164 million for Q3 2025, down from $176 million in Q3 2024, with EPS of $1.67 (flat year-over-year). 
- U.S. Mortgage Insurance in-force grew 2% to $249 billion, with 86% persistency and 2.29% default rate. 
- Returned $500 million to shareholders via buybacks and announced $0.31 dividend, plus $500M new buyback authorization. 
- 12-month ROE of 13% and $854M operating cash flow highlight strong franchise fundamentals. 

**【CFO Financial Commentary】**
- Net premium earned $232M (including $15.9M from reinsurance), with 35bps net rate. 
- Loss provision rose to $44.2M vs $29.8M YoY, driven by seasonal defaults. 
- Operating expenses $34.2M (14.8% ratio), with $6.6B investments yielding 3.9%. 
- Tax rate increased to 16.2% due to Bermuda dividend withholding. 
- Essent Guaranty PMIERs sufficiency at 177%, with $1.6B excess capital. 

**【Q&A Key Highlights】**
- **Credit Trends**: Larger loan sizes ($300K avg) explain higher loss severity, but claims severity below reserves. 
- **Tax Strategy**: Accept higher tax rate (16-17%) to maximize share buybacks, given $1B holdco liquidity. 
- **Capital Upstreaming**: Q4 dividend from MI subsidiary may increase, with quota share reinsurance as alternative. 
- **Diversification**: Title insurance growth limited by high rates; MI remains core with 12-14% ROE potential. 
- **Market Position**: 746 FICO, 93% LTV portfolio mitigates credit risk; 50%+ loans with <5% note rates support persistency.

Essent Group Ltd. (ESNT) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

ESNT

ESNT fundamentals

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