Radian Group (RDN) Q3 2024 earnings summary

Executive summary

• Net income for Q3 2024 was $152 million ($0.99 per diluted share), flat sequentially and down from $157 million in Q3 2023, with book value per share up 18% year-over-year to $31.37.

• Primary mortgage insurance in force reached $275 billion, up from $269.5 billion a year ago, with persistency rates remaining high at 84%.

• Returned $86 million to shareholders in Q3 via dividends and share repurchases, totaling $360 million over the past year.

• Completed $450 million senior notes redemption, reducing holding company debt-to-capital ratio to 18.5%.

• Available holding company liquidity was $844 million at quarter-end, down from $1.2 billion in Q2 2024.

Financial highlights

• Total revenues for Q3 2024 were $334 million, up from $313 million in Q3 2023; net investment income rose to $78 million.

• Net premiums earned for mortgage insurance were $235 million, nearly flat year-over-year.

• Adjusted pretax operating income was $199 million ($1.03 per diluted share), down from $210 million ($1.04 per share) in Q3 2023.

• Other operating expenses were $86 million, up from $79 million in Q3 2023, including a $10 million software impairment.

• Provision for losses was $7 million, compared to $(2) million in Q2 2024 and $(8) million in Q3 2023.

Outlook and guidance

• Persistency rates are expected to remain elevated, supporting insurance in force growth despite lower new insurance written.

• Private mortgage insurance market is projected to grow by approximately 10% in 2025, with 2024 market size at $300 billion, at the lower end of expectations.

• Guidance for Radian Guaranty dividends to exceed $400–$500 million for 2024, with $485 million already paid and $190 million more expected in Q4.

• Operating expense run rate reduction of $20–$25 million expected beginning in 2025.

• No material impact expected from recent PMIERS regulatory updates or elimination of the Disaster Related Capital Charge.