Why Radian Group Inc (NYSE:RDN) is an Excellent Choice?

[Capital Cube] Radian Group Inc (NYSE:RDN)(TREND ANALYSIS) Summary numbers: Revenues of USD 297.29 million, Net Earnings of USD 70.09 million, and Earnings per Share (EPS) of USD 0.29.

Earnings decline from operating margin decreases as well as from unusual items.

RDN-US‘s change in revenue this quarter compared to the same quarter last year of 2.80% is almost the same as its change in earnings, and is about average among the announced results thus far in its peer group, suggesting that RDN-US is holding onto its market share. Also, for comparison purposes, revenues changed by -10.02% and earnings by 55.09% compared to the immediate last quarter.

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Radian Group Inc (NYSE:RDN) stock is currently trading 24.1% below its 52-week-high, 3.57% above its 52-week-low. The 1-year stock price history is in the range of $14.02 – $19.13. Radian Group Inc (RDN) has a price to earnings ratio of 5.51 versus Financial sector average of 16.18. RDN stock price has underperformed the S&P 500 by 16.2%. The Insurance company is currently valued at $3 billion and its share price closed the last trading session at $14.52. The stock has a 50-day moving average of $16.43 and a 200-day moving average of $17.68.

Radian Group Inc (RDN) current short interest stands at 0.04 million shares. It has decreased by 98% from the same period of last month. Around 1% of the company’s shares, which are float, are short sold. With a 10-days average volume of 4.61 million shares, the number of days required to cover the short positions stand at 0.1 day.

RDN reported last quarter earnings on October 27. The Insurance company announced earnings per share of $0.31 against a consensus Street estimate of $0.37, missing estimate by $0.06. This corresponds to an increase of $0.11 compared to the same quarter of the previous fiscal year.

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There are currently thirteen analysts that cover Radian Group Inc stock. Of those thirteen, ten have a Buy rating, three have a Hold rating. On a consensus basis this yields to a Buy rating. The consensus target price stands at $20.27.

A recent analyst activity consisted of Macquarie reiterating their Outperform stance on October 28. Macquarie decreased price target from $20 to $16.5. This corresponds to a 13.64% upside from the last closing price. On the date of report, the stock closed at $14.3.

JMP Securities reiterated their Market Outperform stance on July 14, and increased their price target on RDN stock from $21 to $22.5. This corresponds to a 54.96% upside from the last closing price. On the date of report, the stock closed at $18.82.

Radian Group Inc (RDN) has a debt to equity ratio of 58% compared to Financial sector average of 148.2%. The company has a current ratio of 0.22. This ratio should be higher than one (ideally two) and is an indicator to show if the company is able to finance its short term obligations. Indeed it should have higher short term assets to dispose in order to cover for its short term liabilities.

Company snapshot

Radian Group Inc. provides financial guarantee insurance. The Company’s products and services enable homebuyers to purchase homes more quickly and with smaller down payments, protect lenders against loan default, and lower the costs of mortgage origination and servicing. Radian also provides insurance and reinsurance to investors in corporate, municipal, and asset-backed securities.

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