Radian Group Pocket Pivots On Rising Large Players Volume

Radian Group stock is in an uptrend but weak fundamentals continue to hold this company back as it sells off its underperforming divisions.

Radian Group stock has a bullish cluster of pocket pivot signals (blue dots) on rising large players volume.

Radian Group reported quarterly earnings on October 26, 2017. The company reported EPS of $0.46 versus the $0.42 estimate. Revenue missed coming in at $312.05 million versus the $321.10 million estimate. Radian Group’s revenue was down -2.8% year-over-year.

Radian Group has outperformed the insurance industry this year. Radian Group is poised for long-term growth on expansive mortgage and real estate service offerings, declining delinquency, lower levels of paid claims and improving risk-based capital ratio. With the impact of the restructuring of Radian Group’s underperforming Mortgage and Real Estate Services unit priced into the stock’s valuation, the company seems lazer focused on its core mortgage insurance business. Radian Group has received rating upgrades owing to a string of capital takes undertaken by the company and is thus on track to return to an investment grade rating.

Overall there are no Sell ratings, 2 Hold ratings, and 8 Buy ratings on Radian Group stock.

Radian Group Inc. is an insurance holding company that provides mortgage insurance, and products and services to the real estate and mortgage finance industries. The Company operates in two segments: Mortgage Insurance and Services. You can read more about the company on their website.

Radian Group Stock

Radian Group stock shows rising large players volume on bullish pocket pivot (blue dots) signals.

Radian Group stock has an ok setup at the moment. Price movement has been a little bit too volatile to find a good entry and exit point. It is probably a good idea to wait for a consolidation first.

Radian Group Inc. Review
1.5

Summary

Profitability

RDN has a Piotroski-F score of 5. This indicates an average health and profitability for RDN. RDN has a Return On Assets of 3.00%. This is below the industry average of 5.97%. RDN has a Return On Equity of 5.87%. This is below the industry average of 13.93%. 100% of the industry peers outperform RDN. RDN's Profit Margin of 14.88% is worse than the rest of the industry. The industry average Profit Margin is 41.08%.

Valuation

The Forward Price/Earnings Ratio of 11.16 indicates a rather cheap valuation of RDN. With a price book ratio of 1.55, RDN is valued correctly. With a Price/Earnings Ratio of 26.61, RDN can be considered very expensive at the moment. With a Price/Earning Ratio of 26.61, RDN is valued a higher than the industry average, which is at 15.11. 100% of the companies listed in the same industry are cheaper than RDN! The high PEG Ratio, which compensates the Price/Earnings for growth, indicates RDN does not grow enough to justify the current Price/Earnings ratio. When comparing the price book ratio of RDN to the average industry price book ratio of 1.55, RDN is valued more expensive than its industry peers. Compared to an average industry Enterprise Value to EBITDA ratio of 10.97, RDN is valued more expensive than its industry peers. 84% of the companies listed in the same industry are valued cheaper.

Growth

Based on estimates for the next 2 years, RDN will show a quite strong growth in Earnings Per Share. The EPS will grow by 18.38% on average per year. When comparing the growth rate of the last 5 years to the growth rate of the upcoming 2 years, we see that the growth is accelerating. RDN shows a decrease in revenue. In the last year, the revenue decreased by -4.90%. RDN shows a small growth in revenue. Measured over the last 5 years, revenue has been growing by 5.47% yearly. RDN shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -42.50%. Measured over the past 5 years, RDN shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -47.11% on average per year.

Health

RDN has a Altman-Z score comparable to the industry average, which is at 1.56. The Piotroski-F score of RDN is 5. This is a neutral score and indicates average health and profitability for RDN. When comparing the Debt to Equity Ratio of RDN to the average industry Debt to Equity Ratio of 0.32, RDN required more debt to finance its operations than its industry peers. RDN has an Altman-Z score of 1.56. This is a bad value and indicates that RDN is not financially healthy and even has some risk of bankruptcy.

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Lance Jepsen

For ethical purposes, I try not to hold any position in any stock I profile on GuerillaStockTrading.com unless specifically stated in the article. Owner of GuerillaStockTrading.com. Seasoned entrepreneur, investor, and writer. I love God, family, country, stock trading, economics, and helping people learn how to trade.
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Author: Lance Jepsen

For ethical purposes, I try not to hold any position in any stock I profile on GuerillaStockTrading.com unless specifically stated in the article. Owner of GuerillaStockTrading.com. Seasoned entrepreneur, investor, and writer. I love God, family, country, stock trading, economics, and helping people learn how to trade.

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