ESNT

As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at property & casualty insurance stocks, starting with Essent Group (NYSE:ESNT). Property & Casualty (P&C) insurers protect individuals and businesses against financial loss from damage to property or from legal liability. This is a cyclical industry, and the sector benefits when there is a 'hard market', characterized by strong premium rate increases that outpace loss and cost inflation, resulting in robust underwriting margins. The opposite is true in a 'soft market'. Interest rates also matter, as they determine the yields earned on fixed-income portfolios. On the other hand, P&C insurers face a major secular headwind from the increasing frequency and severity of catastrophe losses due to climate change. Furthermore, the liability side of the business is pressured by 'social inflation'—the trend of rising litigation costs and larger jury awards. The 32 property & casualty insurance stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 2.3% while next quarter’s revenue guidance was 0.9% above. While some property & casualty insurance stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.4% since the latest earnings results. Serving as a crucial bridge between homebuyers and the American dream of homeownership, Essent Group (NYSE:ESNT) provides private mortgage insurance and title services that enable lenders to offer home loans with down payments of less than 20%. Essent Group reported revenues of $362.7 million, up 13.6% year on year. This print exceeded analysts’ expectations by 9.7%. Overall, it was a stunning quarter for the company with a beat of analysts’ EPS estimates. “We are pleased with our second quarter 2026 financial results, which reflect strong profitability, continued growth in book value per share and the resilience of our operating model,” said Mark A. Casale, Chairman and Chief Executive Officer. Interestingly, the stock is up 3.9% since reporting and currently trades at $68.09. Is now the time to buy Essent Group? Access our full analysis of the earnings results here, it’s free. Founded in 1961 and maintaining a network of over 6,300 independent agents across the country, Mercury General (NYSE:MCY) is an insurance company that primarily sells automobile insurance policies through independent agents in 11 states, with a strong focus on California. Mercury General reported revenues of $1.68 billion, up 13.8% year on year, outperforming analysts’ expectations by 10.3%. The business had an exceptional quarter with a beat of analysts’ EPS estimates. Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 5.2% since reporting. It currently trades at $101.08. Is now the time to buy Mercury General? Access our full analysis of the earnings results here, it’s free. Founded during the housing boom of 1977 and weathering multiple real estate cycles since, Radian Group (NYSE:RDN) provides mortgage insurance and real estate services, helping lenders manage risk and homebuyers achieve affordable homeownership. Radian Group reported revenues of $580.7 million, up 95.7% year on year, in line with analysts’ expectations. It was a softer quarter as it posted a significant miss of analysts’ EPS estimates. As expected, the stock is down 8.6% since the results and currently trades at $35.80. Read our full analysis of Radian Group’s results here. With roots dating back to 1853 and majority ownership by Loews Corporation, CNA Financial (NYSE:CNA) is a commercial property and casualty insurance provider offering coverage for businesses, including professional liability, surety bonds, and specialized risk management services. CNA Financial reported revenues of $3.83 billion, up 1.9% year on year. This result topped analysts’ expectations by 1.2%. It was a very strong quarter as it also put up a beat of analysts’ EPS estimates. The stock is down 6.5% since reporting and currently trades at $49.08. Read our full, actionable report on CNA Financial here, it’s free. With roots dating back to 1872 and a business model that empowers local decision-making, American Financial Group (NYSE:AFG) is an insurance holding company that specializes in commercial property and casualty insurance products for businesses through its Great American Insurance Group. American Financial Group reported revenues of $1.90 billion, up 5.3% year on year. This number met analysts’ expectations. Zooming out, it was a mixed quarter as it also produced a beat of analysts’ EPS estimates but a miss of analysts’ net premiums earned estimates. The stock is up 1.3% since reporting and currently trades at $142.37. Read our full, actionable report on American Financial Group here, it’s free. Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership. Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products. By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals. Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

MGIC Investment Corporation MTG appears well positioned to sustain attractive earnings and capital returns in the near term. However, the earnings mix could shift as mortgage-insurance credit conditions gradually normalize.New insurance written (NIW) rose 8.5% year over year to $17.8 billion in the second quarter of 2026, the highest quarterly level since the third quarter of 2022, while insurance in force (IIF) increased 2.6% to $304.8 billion. The growth in NIW and IIF provides MTG with a larger premium-generating base and supports future revenue growth.For MTG, credit normalization refers to a gradual increase in mortgage delinquencies and potential claims as the exceptionally favorable credit performance of recent years moves closer to historical norms. So far, the normalization appears manageable. MTG's primary delinquency rate increased to 2.37% from 2.21% a year earlier, but declined 7 basis points sequentially from 2.44% in the first quarter of 2026. Management expects some seasonal increase in delinquencies in the second half of the year, but current trends do not indicate a material deterioration in credit quality.MTG also benefits from strong cure activity, favorable performance from newer policy vintages and substantial capital resources. The company had $2.7 billion of PMIERs excess as of June 30, 2026, while its reinsurance program reduced PMIERs required assets by approximately 52%. These factors provide a meaningful cushion against higher delinquencies and claims and help support capital flexibility.Overall, MTG should be able to sustain attractive earnings and capital returns as long as credit normalization remains gradual rather than developing into a broader deterioration in mortgage credit quality. Improving NIW, a growing IIF portfolio, disciplined expenses, strong capitalization and reinsurance protection provide a solid foundation. However, investors should expect future earnings to rely increasingly on portfolio growth and recurring operating performance rather than exceptionally favorable loss development. Radian Group’s RDN mortgage-insurance portfolio is exposed to the same gradual normalization in borrower delinquencies and claims, although strong home equity provides an important buffer.Essent Group's ESNT significant portion of its portfolio is entering the period when mortgage-insurance claims are typically highest. Essent expects incurred losses and claims to increase as older books mature. Shares of MTG have gained 11.3% over the past year, outperforming the industry. Image Source: Zacks Investment Research The stock is undervalued compared with its industry. Its forward price-to-book value of 1.27X is lower than the industry average of 2.67X. It carries a Value Score of B. Image Source: Zacks Investment Research The Zacks Consensus Estimate for MTG’s full-year 2026 and 2027 EPS has moved up 6.2% and 4.8%, respectively, in the past 30 days.The consensus estimate for MTG’s 2027 EPS and revenues indicates a year-over-year increase. Image Source: Zacks Investment Research MTG stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report MGIC Investment Corporation (MTG) : Free Stock Analysis Report Radian Group Inc. (RDN) : Free Stock Analysis Report Essent Group Ltd. (ESNT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Essent Group’s second quarter results were shaped by a stable credit environment, high persistency in its mortgage insurance portfolio, and increased investment income. Management attributed the strong cash generation to continued demand for mortgage insurance and the ability to maintain premium yields despite competitive industry dynamics. CEO Mark Casale highlighted the company’s "Buy, Manage & Distribute" model as a key advantage, emphasizing that "success in our business is best measured by growth in book value per share." The company’s approach to portfolio selection and risk management helped deliver robust earnings and book value growth, even as origination volumes remained constrained by affordability challenges. Is now the time to buy ESNT? Find out in our full research report (it’s free). Revenue: $362.7 million vs analyst estimates of $330.8 million (13.6% year-on-year growth, 9.7% beat) Adjusted EPS: $2.08 vs analyst estimates of $1.76 (18.4% beat) Operating Margin: 63.5%, down from 72.4% in the same quarter last year Market Capitalization: $6.23 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Bose George (KBW) asked about expectations for premium yield stability and competitive trends. CEO Mark Casale explained, “We're kind of in line with that,” citing a stable market and consistent economics across competitors. Bose George (KBW) also questioned potential credit risk from the adoption of VantageScore. Casale responded that while VantageScore is more lenient than FICO, GSE oversight and Essent’s proprietary risk models should mitigate any material risk. Mihir Bhatia (Bank of America) probed the sustainability of premium yields as the portfolio turns over. Casale clarified that yields may decline modestly over time but are not expected to shift significantly due to the size and mix of the existing book. Mihir Bhatia (Bank of America) inquired about the faster growth in new insurance written versus the industry. Casale attributed this to selective risk-taking in segments with less competition and greater pricing power. Richard Shane (JPMorgan) asked about Essent’s approach to AI adoption and token usage. Casale described AI as an analytical tool supporting underwriting, pricing, and operational efficiency, while noting that token costs are currently immaterial. Going forward, our analysts will be monitoring (1) shifts in housing affordability and their effect on new mortgage insurance volumes, (2) persistency trends and their impact on premium stability, and (3) the pace of expansion and early earnings contributions from the reinsurance and title businesses. Progress in technology adoption and strategic capital allocation will also be important for evaluating Essent Group’s ability to navigate changing market conditions. Essent Group currently trades at $69.28, up from $65.51 just before the earnings. Is there an opportunity in the stock? The answer lies in our full research report (it’s free for active Edge members). ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively. Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Friday, Aug. 7, 2026 at 10:00 a.m. ET Chairman and Chief Executive Officer - Mark Casale Chief Financial Officer - David Weinstock Investor Relations - Philip Stefano President of Essent Guaranty - Chris Curran Operator: Thank you for standing by, and welcome to the Essent Group Limited Second Quarter Earnings Call. [Operator Instructions] I'd now like to turn the call over to Phil Stefano, Investor Relations. You may begin. Philip Stefano: Thank you, Rob. Good morning, everyone, and welcome to our call. Joining me today are Mark Casale, Chairman and CEO; and David Weinstock, Chief Financial Officer. Also on hand for the Q&A portion of the call is Chris Curran, President of Essent Guaranty. Our press release, which contains Essent's financial results for the second quarter of 2026 was issued earlier today, is available on our website at essentgroup.com. Our press release includes non-GAAP financial measures that may be discussed during today's call. A complete description of these measures and the reconciliation to GAAP may be found in Exhibit Q of our press release and in our second quarter 2026 earnings presentation posted on our website. Prior to getting started, I would like to remind participants that today's discussions are being recorded and will include the use of forward-looking statements. These statements are based on current expectations, estimates, projections and assumptions that are subject to risks and uncertainties, which may cause actual results to differ materially. For a discussion of these risks and uncertainties, please review the cautionary language regarding forward-looking statements in today's press release. The risk factors included in our Form 10-K filed with the SEC on February 18, 2026, and any other reports and registration statements filed with the SEC, which are also available on our website. Now let me turn the call over to Mark. Mark Casale: Thanks, Phil, and good morning, everyone. Earlier today, we released our second quarter 2026 financial results, which again reflect the benign credit environment, along with the effects of current interest rates on persistency and investment income. Cash generation from our core MI business remains strong, giving us the flexibility to allocate capital between investing in growth across the franchise and returning capital to the shareholders. Our Buy, Manage & Distribute operating model remains a distinct advantage, positioning Essent to produce high-quality earnings across a wide range of economic environments. For the second quarter of 2026, we reported net income of $190 million or $2.08 per diluted share, which translates to an annualized return on average equity of 13.4%. As of June 30, our book value per share was $63.1 and inclusive of our common dividend, it grew nearly 13% over the past year and has compounded approximately 18% annually since our IPO. As a reminder, we believe that success in our business is best measured by growth in book value per share. In our MI business, as of June 30, our Insurance in Force was $250 billion, a 1% increase versus a year ago. 12-month persistency was 84%, reflecting the current rate environment and that nearly half of our In Force portfolio has a mortgage rate of 5.5% or lower. We believe that this rate dynamic will support elevated persistency levels, while our portfolio growth will remain in a pause as affordability continues to constrain origination volume. Longer term, we continue to believe that favorable demographics and pent-up demand will be a positive for housing in our MI business when affordability improves. The credit quality of our Insurance in Force remains strong with a weighted average credit score of 747 and a weighted average of original LTV of 93%. Our portfolio default rate was effectively flat quarter-over-quarter, and we continue to believe that the embedded home equity of our in force book should mitigate ultimate claims. In addition, 97% of our Insurance in Force is subject to reinsurance protection, which provides capital relief and reduces tail risk. On title, we continue investing in technology across our platform while onboarding new partners by leveraging the broad relationships within our MI franchise. High interest rates remain a modest headwind near term, and we do not expect title to have any meaningful impact on earnings. Longer term, our expectations remain the same. Title provides a capital-light opportunity that generates supplemental earnings for our franchise and deepen our lender relationships. Turning to the Reinsurance segment. We continue to expect written premium of approximately $320 million for our P&C reinsurance activity in 2026, with roughly half earned this year at a combined ratio in the high 90s. The P&C book is weighted towards casualty and specialty requiring minimal incremental capital from Essent Re. However, over the near term, mortgage risk and a related MGA business will continue to drive the segment's earnings. Our consolidated cash and investments as of June 30 totaled $6.6 billion with an annualized aggregate investment yield for the second quarter of 4.9%. Our investment yield this quarter includes income from other invested assets, a portfolio of strategic investments in insurance, specialty finance and housing that we built over several years. It's now approximately $450 million or 7% of our total portfolio. Although returns will vary period to period, this portfolio gives us another way to deploy capital outside of our core businesses to generate income and increase book value. We continue to operate from position of strength with $5.7 billion in GAAP equity, access to $1 billion in excess of loss reinsurance and $1.1 billion in cash and investments at the holding companies. With a trailing 12-month operating cash flow of $834 million, our franchise remains well positioned from an earnings, cash flow and balance sheet perspective. Capital strategy remains a balanced approach that optimizes shareholder returns over the long term while preserving optionality for strategic growth. Year-to-date through July 31, we repurchased nearly 6 million shares for approximately $350 million, and I'm pleased to announce that our Board has approved a common dividend of $0.35 for the third quarter of 2026. Now let me turn the call over to Dave. David Weinstock: Thanks, Mark, and good morning, everyone. Let me review our results for the quarter in a little more detail. Second quarter, we earned $2.08 per diluted share compared to $1.82 last quarter and $1.93 in the second quarter a year ago. My comments today are going to focus primarily on the results of our mortgage insurance and reinsurance segments. There's additional information on our Corporate & Other results in Exhibit D and E of the financial supplement. Our mortgage insurance portfolio ended the second quarter with Insurance in Force of $249.7 billion, an increase of $1.8 billion from March 31 and an increase of $2.9 billion or 1.2% compared to $246.8 billion at June 30, 2025. Persistency at June 30, 2026, was 84% compared to 84.7% on March 31, 2026. Mortgage Insurance premium earned for the second quarter of 2026 was $216 million. The average base premium earned for the Mortgage Insurance portfolio for the second quarter was 40 basis points, down 1 basis point from last quarter, and the average net premium rate was 35 basis points, consistent with last quarter. Our Mortgage Insurance provision for losses and loss adjustment expenses was $29.4 million in the second quarter of 2026 compared to $37.6 million in the first quarter of 2026 and $15.3 million in the second quarter a year ago. At June 30, the default rate on the Mortgage Insurance portfolio was 2.53%, essentially unchanged from March 31, 2026. Mortgage Insurance operating expenses in the second quarter were $31.9 million, and the expense ratio was 14.8% compared to $37.6 million and 17.4% last quarter and $33.6 million and 15.3% in the second quarter last year. At June 30, Essent Guaranty's PMIERs sufficiency ratio was strong at 172% with $1.5 billion in excess available assets. Turning to our Reinsurance segment. Net premiums written in the first half of 2026 were $249 million compared to $31 million in the first half of 2025. Net premiums earned in the first half of 2026 were $73 million compared to $30 million in the first half of 2025. The increase in premiums reflects the growth in non-mortgage business from our expansion into P&C reinsurance activity. The reinsurance combined ratio was 77.9% in the second quarter of 2026 compared to 69.6% last quarter and 19.4% a year ago. The change in the combined ratio was as expected, reflecting the difference in underwriting performance between the mortgage and non-mortgage lines and the changing business mix of the segment's premiums. The pretax underwriting income for the reinsurance segment predominantly reflects the underwriting results of our GSE and other mortgage risk share business, while the contribution from our P&C activity was not material. Consolidated net investment income increased $2.4 million or 4% to $61.6 million in the second quarter of 2026 compared to last quarter due to an increase in the overall yield of the portfolio. Income from other invested assets was $19.4 million in the second quarter of 2026 compared to $10.2 million last quarter and $4.5 million in the second quarter a year ago. The higher results this quarter are primarily due to increased favorable fair value adjustments. Our holding company liquidity remains strong and includes $500 million of undrawn revolver capacity, under our committed credit facility. At June 30, we had $500 million of senior unsecured notes outstanding, and our debt-to-capital ratio was 8%. Year-to-date, Essent Guaranty paid dividends of $115 million to its U.S. holding company. At quarter end, Essent Guaranty's statutory capital was $3.7 billion with a risk-to-capital ratio of 8.5:1. Note that statutory capital includes $2.7 billion of contingency reserves at June 30. As of July 1, Essent Guaranty can pay additional ordinary dividends of $302 million in 2026. During the second quarter, Essent Re paid a dividend of $100 million to Essent Group. Also in the quarter, Essent Group paid cash dividends totaling $31.6 million to shareholders, and we repurchased 3.2 million shares for $191 million. Now let me turn the call back over to Mark. Mark Casale: Thanks, Dave. In closing, Essent is a well-capitalized, high-quality franchise with strong and consistent cash flow generation. We remain confident in our ability to grow book value per share, return capital and invest in opportunities to build a stronger franchise for the long term. Now let's get to your questions. Operator? Operator: [Operator Instructions] Your first question comes from the line of Bose George from KBW. Bose George: Actually, first, on the premium yield, can you remind us, do you expect that to be fairly stable? And anything to call out on the slight decline this quarter? And then could you just talk about competitive trends? Mark Casale: Sure, Bose. Yes, I think we guided to 40-ish -- 40 basis points for the year. So I think we're kind of in line with that. Longer term, it's really just a reflection of new business written, persistency and all the things that go into the portfolio. In terms of the competitive environment, I think it's pretty much the same, relatively stable, and it's been stable for a while. It's a small market, Bose. So there's not a lot to be gotten from a lot of competition. And remember, in this industry, there's no credit competition. I mean the GSEs because of the rules and the guardrails they set up, we don't have any real credit competition. So the GSEs don't approve it generally, we don't insure it. So that's a positive that I think sometimes can be lost on investors. In terms of the price competition, again, I think it's fairly stable. And if you take a step back and look at really where the different players are participating, everyone kind of has their spots, whether it's particular lenders, sometimes it's geographies, clearly around DTIs, FICOs, or credit scores now that we call them, everyone's picking their spots. But at the end of the day, the economics are fairly similar. So for someone like Essent, we're at the lower end of the market share gain. But if you look at kind of lifetime premium share, we're probably closer to middle of the pack, if not a little bit above that. So that's really, for us, as you know, you see our earned premium yield, Bose, were a bit higher than the industry. And part of that is just -- it's our selection technique. And I don't think we do anything better. I just think we have a different appetite, and we're more interested in the premium dollars so much more than just market share. If you look at our market share on 85 and below, we're the lowest in the industry. And again, that's market share rich, but premium light. Some folks like that, that's fine. But I think -- so when you add it all up, the economics across the industry are fairly similar. And I think that's a positive for investors. Bose George: Okay, great. That's helpful. And then actually just on that topic of what's happening with the credit scores. I think one concern in the market is that with VantageScore picking up momentum that lenders could use that to game the system. I mean do you think there's any credit risk to be worried about as VantageScore becomes a bigger part of the market? Mark Casale: Yes, it's a fair question. I would say, again, taking a step back a little bit and looking at VantageScore, it is a little bit more lenient than FICO score to be sure, right? There's a 20 basis point -- 20-point gap between FICO and Vantage, the GSEs have set up. It's probably a little bit wider. I wouldn't be surprised to see the GSEs tighten that over time. So if there's any kind of arbitrage, Bose, I expect that to disappear over time. I really do. I don't think the GSEs are going to leave money on the table. They're just too smart for that. In terms of our market, it's actually a little bit of a benefit. So if the scores are a little bit higher, that could bring an FHA borrower into the conventional business. We have to be careful how we price it. But I think net-net, it's probably positive for the conventional market. And in terms of kind of adverse selection, I think that's going to even itself out. I think for us, clearly, given how our engine works, we're not really reliant on the credit score. We were using over, whatever, 400-plus variables. The credit score is a component of that for sure, but we're relatively score agnostic because we come up with our own scores. So -- and we feel comfortable there. I think with the cards, you're going to have to be a little bit more careful. And again, I think that's really going to come down to the GSEs, and how they structure the LLPAs going forward. And again, like I said, I think that will be squared up pretty in relatively short order, should it become bigger. And it's not very big right now. There's not many lenders using it. Actually, some of our top lenders don't even have it as a kind of a priority item because I don't see the real pickup. So it remains to be seen. It's a good question, certainly something in the industry. And if it does help certain borrowers get loans that they are getting today. I think that's a positive. I just don't think that's the case. I think it may shift again from FHA to conventional. I don't see a lot of borrowers coming off the sidelines because they have a higher score to be honest. Operator: Your next question comes from the line of Mihir Bhatia from Bank of America. Mihir Bhatia: I wanted to first just follow up on Bose's question about premium yield. I hear you about it being dependent on a lot of factors. But maybe just tell us about -- talk to us a little bit about like just the new money yield versus what's in the book? Like I think what we're trying to think about is like over the next year or two as the book turns over a little bit, what that premium yield can look like is 40 bps like the floor you recommend? I know you've guided that for this year. But just like as we go look out a little bit further. Mark Casale: Yes. I wish it was as simple as I could just tell you what our new premium is, our new insurance written, and you could calculate it. It's just not that simple. It's just because it's so embedded in the years of books. We're at 40-ish. I would expect that if you're modeling it out here over the next couple of years, it may go down a little bit, but it's not a big move and just because of the weight and the size of the book. I would say back into the new insurance written, again, that's what it's dependent on. We feel pretty good about that. And again, as I mentioned earlier, we have been looking -- we're more a premium seekers so much versus just the best credit quality. And again, that gets to my point that everyone in the industry is picking their spots. But I think for us, in the second quarter, and this is overall premium, we increased premium 10% on new insurance written just in the quarter, and that's part of -- we took a little bit more risk, but I think that is a -- that's just a good sign of how the industry picks their spots, and we're able to look for stuff and find value or at least what we perceive value. But again, I think that's our strategy. It's a little different than others. But again, like I said, everyone is kind of picking their spots, but the economics across the industry are relatively consistent. Mihir Bhatia: And just actually on that point, I mean, you did grow NIW a little faster than the industry this quarter. Now I know you don't manage for -- like we've talked about, I think, extensively on these calls about not managing for market share and focusing on returns. But I am curious just in terms of was there anything unusual? Were there certain pockets or segments where you found a little bit more opportunity this quarter, or was it just -- as you were talking about like everyone has their pockets and the market just kind of came to where your pockets are... Mark Casale: There's a few specifics, but, I mean, I think, it's really around kind of the makeup of the borrower, whether it's credit score, debt-to-income, LTV, there are certain competitors that stay away from I would say they stay away from that type of risk and much -- they're probably lower DTI, lower LTV, so they like the 85s, much higher credit score. So when we go into those a little bit more of that, the other side of that market, say, higher DTI or higher LTV, there's just less competition here. So instead of being 1 of 6 or 1 of 3 or 1 of 4, so we like our chances there. So there's a little bit more pricing power, I would say, in those buckets than they are, everybody wants the 780, right? And so that's going to be super competitive but -- in these other markets. And sometimes it states and geographies, certain people like certain parts of the country. So there's other areas where, again, there's just a little bit more -- I would say, a little bit more value is the way we kind of look at it. So nothing -- again, nothing cutting edge per se, but it's just a matter of just kind of piercing through the market and seeing -- and trying to get those and capitalize on those opportunities. Operator: [Operator Instructions] Your next question comes from the line of Rick Shane from JPMorgan. Richard Shane: Look, it's a pretty straightforward quarter, and I'm following to analysts who ask really good questions. So I'm going to go a little bit off the beaten path. It's a question we've been asking on some calls and certainly back channel with a lot of the companies we follow. If you could talk a little bit about how you guys are looking at AI and token usage within the organization. I think we're finding a really disparate range of outcomes. Some companies are still saying, "Hey, be aggressive. We want you to figure everything out, don't worry about token usage," and we're starting to now hear some conversations about throttling usage and things like optimizing model selection. Where are you guys, and how do you think this plays out over time? Mark Casale: Yes, it's certainly a topic amongst companies and at the top of the house here with the Board. I would say our token usage is pretty robust. The cost of it's pretty -- when you look at the cost of tokens relative to our operating expense level, though, Rick, it's pretty small. So we see -- we're not a tech company. So I know we've seen some of the stories of tokens run rampant. But we don't really have any of that. I would say out of our roughly 500 people, there's 100 really that are active users. And when we think about it, clearly, when we think about AI, we kind of break it in the bucket. So at the top of the house, I would say it's a very strong analytical tool. So whether you're using -- when we use -- we use Copilot, we use Claude, we use Gemini, we use Kiro. And it depends on where in the organization, top of the house, I'm an active user of Claude. It's a great analyst. It's a great way to cut through and analyze a lot of data. It's not -- it's a replacement for [ judgment. ] It's like having another pair of hands. So it's really complementary when we look at opportunities when we're looking through different 10-Ks or Qs and all those sort of things, I find it pretty valuable from that standpoint. But it is -- it's garbage in, garbage out. You don't prompt well, you're not going to get super good answers. And we think at the top of the house, we have to be active users. So it's hard for us to push down if we're not real familiar with the tools. I would say within the risk group, remember, we take -- that's the kind of what we do for a living. We see opportunities there to improve the analytics around EDGE, both on the frequency side, the severity side and just improving the cycle times of our ability to make changes. And we're making progress there. It's -- and just taking a step back, Rick, it's not like you can wave a magic wand and everyone just starts using AI. There's a process. You have to make sure you get the right data in. So that's in process within the risk group. Clearly, within our IT group, the ability to code faster with Kiro has been a big lift. And I think that -- so you'll see changes there. And again, it gets back to cycle time. So how quickly can you make changes to systems or improve systems. So we have a very modular system platform that's been on the cloud now for close to 10 years. So we were early adopters of it, really, Rick, because of cyber. If you remember 10 years ago, cyber was a significant risk for companies that had kind of localized data centers. And so for us, it was how do we protect ourselves? The frequency of our data center getting hit was probably pretty low, but the severity could be devastating. So we moved up to the cloud where the frequency is really high, but the severity is low. So -- because we're an AWS' cloud, we feel like we're pretty well protected. So we've been early adopters of the cloud. And now so as a modular system, we're able to go in now, and it will be a process over the next few years to kind of make the system even better and make changes. And there's certainly going to be efficiencies within that over time. But we don't -- we look at it more in terms of the ability to price better, pay claims faster, customer response times with premiums and working through issues. That's the heart of our business. And we don't talk about it a lot and neither really do our competitors, just how operationally intensive these businesses are. And they're a lot more complicated behind the wall than I think people -- and I mean, really, it's a credit to the industry. I don't talk about it a lot, but it's a key competitive advantage in terms of how we think about, and how complicated some of the complex these businesses are. So I think from an AI perspective, it's going to help us. On the title side, it's probably even, I would say, a greener pasture, just when you think about a lot of processing, whether it's search and exam, all those sort of things, we think we can do better, cheaper, faster with AI. So we -- and I mentioned in the script, we're investing in technology. When we bought the title company, they outsourced all their IT, and they used a third-party provider. And for us, what we did very similar to what we did on the MI side, we bought the code of an underlying system and now have implemented. It's going live soon. Part of it, we're testing it live. But it'll be much easier to embed AI and some of the agents and tools within that. So I think we're -- so we don't look at it as -- so when you get back to your question, the token cost, is pretty immaterial relative to kind of the potential. I think it will play out over the next few years. And I would be surprised. I think most companies are pretty actively involved. We talked to some of our top lenders, and it's clear the public one, which ones are using it and the efficiencies there in terms of mortgage originations. So I think it's positive because at the end of the day, big picture, it's probably going to lower the cost of the borrower. Richard Shane: Yes. Look, personally, I think this is probably the most -- it is the most transformational thing I've seen other than when I used to sit around and wait for faxes for earnings releases. Mark Casale: You're dating yourself there, Rick. I mean I can say, too, as I explained to the team, I used to use spreadsheets, which means we would actually spread the paper out. And we look at it that way. We didn't invent Excel, but we certainly leverage it. And I think a lot of these is how do you leverage these tools to price loans that are become more efficient from an operating expense basis. And to me, that's the exciting part. And I think as an entrepreneurial company at the top of the house and within the senior management team, I think we've embraced it pretty good. Operator: Your next question comes from the line of Rowland Mayor from RBC Capital Markets. Rowland Mayor: I wanted to quickly start on the P&C business and just understand if there's any meaningful cat exposure there. And then could you help us understand a bit on the underlying risk in the casualty? Is it U.S. or international? Are there any notable lines of business that we need to know about? Mark Casale: No. I would say there's really two books of business, Rowland, which is Lloyd's. And that's pretty well diversified. I would say that's 85% insurance, 15% reinsurance, mostly specialty and casualty. There is a little bit of property, I would say, probably 15-ish percent is property, not all cat, so probably more mainstream type property risk. And with Lloyd's, remember, it's -- we wrote a check for $50 million. So it's -- in a way, it's a strategic investment that's -- we're recognizing that as premium and losses. But we're backing 45-plus syndicates. So it's pretty well diversified. I think the top 10 syndicates make up 40-ish percent of the book there's definitely some exposure there from specialty, marine and energy. But remember, we also -- with the benefit of the hedging that the insurance companies do, so we're getting -- that's -- we're getting this net. So we don't -- and we had a pretty, I would say, conservative loss pick upfront for the Lloyd's book. I think for the quota share, that's spread out under over 400 different cedents. It's 70-ish percent casualty, 30% specialty, and the casualty is across the board. So whether it's general liability, D&O, workers' comp, all cross, we think it's pretty well diversified. And they're same too, the loss pick there of combined ratio was 100%. So this year, Rowland, we'll earn a few bucks on the P&C business, and we expect that to grow over time. But taking a step back, the way we look at reinsurance segment, right, and the P&C part of it is -- it's an investment. It's another chance for us to allocate capital. We're bringing in, obviously, a lot of -- or generating a lot of cash flow, $830-ish million over the last 12 months. We're clearly -- our first choice always is to deploy it into the core business. It's such a good business. But it's relatively limited, right, in terms of whether it's 1 of 6 competitors, the unit economics, all those sort of things. And then we look for -- we call them like little call options. What other places can we invest capital which over time could become something bigger. Title is an example of that. And I think P&C is another example. The third example is our other invested assets, which is really strategic investments. And we've built that up over the last probably 3, 4 years. It's probably roughly like 7% of the portfolio, roughly, maybe a little bit higher percentage of equity, but it's strategic. So we work pretty closely with private equity funds as the majority of what we do, and we invest alongside them in direct investments. So when we went public, Rowland, back in the day, we talked about stacking vintages. So we had our 12 vintage or 13 vintage, and we would just stack them. And over time, we've built that $250 billion book. It's generating a lot of cash. So very similar philosophy across the board in these other investments. So for the strategic investments, we're stacking investments. So we're stacking a $25 million investment here, $30 million here, $10 million there. I mean, this year, we have committed in the first half of the year $100 million on strategic investments. We'll fund that over a period of four years. Maybe it takes a while, and it takes a while for them to harvest and have cash flows and return capital to us. So it's always lumpy, but at the end of the day, what is our common -- what's our #1 goal, grow book value per share. So it helps us do that. I think on the P&C side, that's a different business. It's much different than the MI business. I mean in the MI business, we are chartered to make a market every day in high LTV loans, and we do it for first-time home buyers. In the reinsurance business, we're not -- under no such obligations. So I think we can be, I would say, a lot more -- it's much more like an investment business, where you're going to lean in on certain times and back off on others. There, the concept, especially on the casualty side, is how do we stack float, right? So if we can write a couple of hundred million dollars of gross written and increase that over time in a careful way. Certainly, you want to have underwriting income but stacking the float will pay off. It's not going to pay off this year or next year long, but it will pay off down the line. Title -- and when you think about what timing of the market on P&C, given where the market is in terms of probably too much capital, we're probably the new capital guy where there's too much capital, but it's not a bad time to build out the infrastructure, right, in this type of market. So you're ready to the next market. So we continue to do our work there. I mean on the transaction that we did on the quota share, we have access now to loss triangles from 2005 across both specialty and casualty by line excess of loss and quota share. That's a treasure trove that we can look to as we make other decisions, we start to build that historical context, which we don't have in that business. And we have it in spades in the mortgage business, but it's always about data. And I think with Lloyd's it's the same thing. As we, over time, continue to make the trips there, get the data, how does that make us smarter, longer term, if we want to get bigger in the business. We may not get bigger. That's why it's kind of a call option. I think on the title side, it's same thing. It's a relatively soft market in title, especially on the residential side. It's not a bad time to be building out infrastructure. And there, the stacking is we stack lenders. So we continue to leverage and sign lenders up in slow times. So when the market does come back, which it will, trust me, the housing market will come back, maybe not in the next 6 months or 12 months, but housing will grow again in this country. And I think for title, once most mortgage rates are at 6%, the refinance part of that market will become much more robust. And we're clearly levered to that. On the underwriting side, we're stacking title agents. So we continue to focus on Florida and Texas, and you kind of prepare yourself when the market comes back. I think from an investor standpoint, it's a good situation to be in, right, because we're investing in the core business, getting good returns. We're making, I think, smart investments across title, P&C and kind of these strategic investments. And we had like excess of 100% payout ratio in the first half of the year. So when you combine them all, it's nice optionality, I think, for our longer-term investors. Rowland Mayor: That was far more in-depth of an answer than I could have hoped for. Switching to the core business. I was just wondering if you think we need to see affordability dynamics meaningfully shift for the NIW opportunity to improve? Or have there been some signs that housing demand is adjusting to the rate environment? Mark Casale: I think the answer to your question is, yes. We do need to see the affordability approve -- and again, improve. Again, Rowland, taking a step back, this is just a function of time. When we look at that 2021 period, with ultra-low rates, HPA at the end of the day. So when the music stopped in the middle of '22, HPA had gone up 50%. And what you had during that 2021 period was just this rush to buy everything, whether it was bicycles or pools or cars or boats and houses. And what you saw with younger folks leaving the city, they accelerated that. People who wanted that larger house because of low rates, they accelerated that. My favorite is, I'm going to be working remote forever, so I need to have a special room just for my Zoom office. So we're going to get that now. So what we did is, we really pull, it could be close to 5 years of demand forward. If you think about those big years, and we're suffering, I would say, this is the after effect of that. So post second half of '22, '23, '24, '25, '26, we're still in it, Rowland. I don't see it -- and when you think about affordability, you have to break it into three things, right? It's the job income growth, it's interest rates, and it's HPA. So HPA is still growing, which I think helps us even in our later book, but it's not really going to help affordability. I think it's going to be -- for it to happen sooner rather than later, it's going to have to be rates. It's -- the math is relatively simple. I think from an Essent standpoint, even from an MI perspective, you talked about the industry standpoint, it's just so well positioned. I mean we said this before, we took a lot of questions pre-'20 like, geez, Mark, what's going to happen when rates go up, and originations start to slow down. Our response was well, our persistency will be higher. And it's kind of a natural hedge in the business, very much like a mortgage servicing book. It's played out that way in spades. So it's, I would say, the downturn or the slowness is longer than we thought, Rowland. But remember, the longer it takes, the demand is almost -- think about the demand queuing up, right? So these young homebuyers haven't gone anywhere. They just have an affordability issue. So I think -- and this is a little bit ironic, but the longer this lull lasts, the stronger it will come back. I just think it's probably at the tail end of the decade. Rowland Mayor: And then if I could just sneak in one more. Is the right way to think about the subsidiary dividend capacity, is that it grows largely alongside the scheduled contingency reserve releases shown in the slide deck? Mark Casale: Yes. It's really -- that's a good catch. It is. I mean, obviously, the income coming from the group given a lot of the business we wrote as we grew, remember, we've -- you have to hold 50% of the premium for 10 years. So if you look at '17, '18, '19, and obviously, '20, '21, there's like a bubble there of, I would say, increased contingency reserves that will come in over the next few years. So it's a lot of nice dry powder for us in terms of kind of dividend capacity coming out of Essent Guaranty. Yes, good catch. Operator: And there are no further questions. I will now turn the call back over to management for closing remarks. Mark Casale: Thanks, everyone, for your participation, and have a great weekend. Operator: This concludes today's conference call. Thank you for your participation. You may now disconnect. Before you buy stock in Essent Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Essent Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $421,943!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,382,819!* Now, it’s worth noting Stock Advisor’s total average return is 983% — a market-crushing outperformance compared to 216% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 14, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Essent (ESNT) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Mortgage insurance provider Essent Group (NYSE:ESNT) beat Wall Street’s revenue expectations in Q2 CY2026, with sales up 13.6% year on year to $362.7 million. Its non-GAAP profit of $2.08 per share was 18.4% above analysts’ consensus estimates. Is now the time to buy ESNT? Find out in our full research report (it’s free). Revenue: $362.7 million vs analyst estimates of $330.8 million (13.6% year-on-year growth, 9.7% beat) Adjusted EPS: $2.08 vs analyst estimates of $1.76 (18.4% beat) Operating Margin: 63.5%, down from 72.4% in the same quarter last year Market Capitalization: $6.18 billion Essent Group’s second quarter results were shaped by a stable credit environment, high persistency in its mortgage insurance portfolio, and increased investment income. Management attributed the strong cash generation to continued demand for mortgage insurance and the ability to maintain premium yields despite competitive industry dynamics. CEO Mark Casale highlighted the company’s "Buy, Manage & Distribute" model as a key advantage, emphasizing that "success in our business is best measured by growth in book value per share." The company’s approach to portfolio selection and risk management helped deliver robust earnings and book value growth, even as origination volumes remained constrained by affordability challenges. Looking ahead, Essent Group’s outlook is tied to improving housing affordability, continued elevated persistency, and further progress in its reinsurance and title segments. Management underscored that the persistent high interest rate environment will support existing business but could limit new originations in the near term. Casale noted, “The longer this lull lasts, the stronger it will come back,” referring to pent-up housing demand. Strategic investments in new technology and a diversified approach to capital allocation are expected to provide additional earnings opportunities as market conditions evolve. Essent Group’s management credited second quarter performance to high persistency levels, a stable competitive landscape, and strategic capital allocation, while highlighting incremental progress in its non-mortgage businesses. Persistency remains elevated: Persistency, or the rate at which policies remain in force, held at 84%, supported by mortgage rates below 5.5% for nearly half the portfolio. This dynamic reduces policy runoff, stabilizing premiums and supporting strong cash flows despite subdued origination activity. Stable industry competition: CEO Mark Casale described the mortgage insurance market as relatively stable, with competitive activity consistent across geographic and credit segments. He emphasized that “the economics across the industry are fairly similar,” allowing Essent to focus on higher-value pockets rather than chasing broad market share. Strategic risk selection: Essent continued to target segments with higher debt-to-income or loan-to-value ratios, where competition is lighter and pricing power is stronger. This approach led to a 10% increase in premium for new insurance written during the quarter, demonstrating the company’s ability to identify and capitalize on niche opportunities. Investment income and diversification: The company’s investment portfolio generated higher yields, with other invested assets—primarily strategic investments in insurance and specialty finance—contributing $19.4 million in income. These investments and the expanding reinsurance and title businesses provide alternative earnings streams beyond core mortgage insurance. Progress in reinsurance and title: The reinsurance segment continued to ramp up, with a diversified mix across Lloyd’s syndicates and quota share arrangements. Title operations advanced technology adoption and agent onboarding, though management reiterated that this segment is not expected to materially impact near-term earnings, but remains a long-term growth lever. Essent Group’s forward outlook is shaped by a persistent high-rate environment, ongoing housing affordability constraints, and diversification into reinsurance and title. Housing affordability recovery: Management believes that improved housing affordability—driven by lower interest rates or income growth—is essential for a rebound in new mortgage insurance originations. Current pent-up demand from first-time buyers is expected to fuel future growth once affordability improves. Persistency and portfolio stability: Elevated persistency levels are expected to continue, supporting premium stability and cash flow generation. Casale noted that persistency serves as a natural hedge, offsetting lower new business volumes in the current environment. Strategic growth in reinsurance and title: The company plans to methodically expand its reinsurance and title businesses. While these segments currently represent a small portion of earnings, management views them as "call options"—opportunities that could add material value over time without requiring significant capital today. Going forward, our analysts will be monitoring (1) shifts in housing affordability and their effect on new mortgage insurance volumes, (2) persistency trends and their impact on premium stability, and (3) the pace of expansion and early earnings contributions from the reinsurance and title businesses. Progress in technology adoption and strategic capital allocation will also be important for evaluating Essent Group’s ability to navigate changing market conditions. Essent Group currently trades at $68.67, up from $65.51 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members). ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time. Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.

Essent Group ESNT reported second-quarter 2026 operating net income per share of $2.08, which beat the Zacks Consensus Estimate by 17.5%. The bottom line improved 7.8% year over year. The quarterly results benefited from higher total revenues, stronger net premiums earned in the reinsurance segment, and increased income from other invested assets, partly offset by higher provisions for losses and LAE, as well as higher operating expenses. Essent Group Ltd. price-consensus-eps-surprise-chart | Essent Group Ltd. Quote Revenues were $362.7 million, up 13.6% year over year. The top line exceeded the Zacks Consensus Estimate by 10.5%. Net premiums earned rose 11.2% year over year to $276.8 million. Net investment income increased 3.9% year over year to $61.6 million. Income from other invested assets jumped to $19.4 million from $4.5 million a year ago. Mortgage insurance in force (IIF) was $249.7 billion, up 1.2%. New insurance written (NIW) was $14.1 billion, up 12.8% year over year. Mortgage Insurance: Net premiums earned were $215.7 million, down 2.1% year over year. The MI loss ratio deteriorated to 13.6% from 7% a year ago, while the expense ratio improved to 14.8% from 15.3%. The MI combined ratio deteriorated to 28.4% from 22.3%. Pretax income totaled $212.6 million, down 3.4% year over year. Reinsurance: Net premiums earned rose to $43.6 million, soared 214.5% year over year, reflecting continued expansion of the reinsurance business. The Reinsurance combined ratio deteriorated to 77.9% from 19.4%, driven by higher loss provisions and acquisition costs. Segment pretax income totaled $17.1 million compared with $18.3 million a year ago. MI IIF increased to $249.7 billion with NIW of $14.1 billion. Annual persistency was 84%, compared with 85.8% a year ago. The default rate increased to 2.53% from 2.12% a year ago, while the number of loans in default rose to 20,278 from 17,255. The provision for losses and LAE increased to $48.9 million from $17 million. Within Mortgage Insurance, the provision increased to $29.3 million from $15.3 million, while Reinsurance losses increased to $18.7 million from $0.36 million a year ago. Other underwriting and operating expenses were $75.3 million, up 19.9% year over year. The increase reflected higher compensation and benefits, acquisition costs and other underwriting and operating expenses. As of June 30, 2026, book value per share rose to $63.01 from $56.98 a year ago. Cash and investments available for sale at the holding companies totaled $1.1 billion. Debt-to-capital was 8.1%, with $500 million of outstanding borrowings and $500 million of undrawn committed capacity. Capital return: The company’s board declared a 35 cents per share quarterly dividend, payable on Sept. 10, 2026. Through July 31, Essent repurchased 5.8 million common shares for $348 million. Essent Guaranty can pay up to $330 million of ordinary dividends in 2026. ESNT currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Selective Insurance Group, Inc. SIGI reported second-quarter 2026 operating earnings of $1.95 per share, which beat the Zacks Consensus Estimate by 13.4%. The bottom line increased 48.9% year over year. Revenues of $1.37 billion rose 4.5% from the year-ago quarter and topped the consensus estimate by 0.7%. Net premiums written declined 5% year over year to $1.22 billion due to a 6% decrease in Standard Commercial Lines, an 8% fall in Standard Personal Lines and a 2% decline in Excess and Surplus Lines. Our estimate was $1.33 billion. Net premiums earned increased 2.3%. Direct new business fell to $206.1 million from $248.1 million. Renewal pure price increases averaged 6.5%, down from 9.9% in the prior-year quarter. NMI Holdings, Inc. NMIH reported second-quarter 2026 adjusted earnings of $1.38 per share, which rose 13.1% year over year. The bottom line beat the Zacks Consensus Estimate of $1.28 by 7.81%. Revenues rose 8.1% year over year to $188 million and surpassed the consensus mark of $185 million by 1.73%. Primary insurance in force increased 5.8% to $227.1 billion. Net premiums earned increased 5.7% year over year to $157.5 million, reflecting continued expansion in the insured portfolio. Our estimate was $157 million. Net investment income climbed 21.6% to $30.3 million, providing another meaningful lift to the top line. Our estimate was $27 million. Mercury General Corporation (MCY) reported second-quarter 2026 operating income of $3.52 per share, which surged 31.8% year over year and beat the Zacks Consensus Estimate of $1.80 by 95.6%. Revenues of $1.67 billion surpassed the consensus mark by 5.8%. Net premiums earned increased 9.6% year over year to $1.5 billion. Net premiums written rose 5.3% to $1.56 billion, while direct premiums written advanced 9.3% to $1.62 billion. Net investment income before taxes increased 14% year over year to $89.8 million. After-tax investment income rose 16.1% to $76.6 million. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Essent Group Ltd. (ESNT) : Free Stock Analysis Report Selective Insurance Group, Inc. (SIGI) : Free Stock Analysis Report NMI Holdings Inc (NMIH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Essent Group Ltd. recently reported past second-quarter 2026 results, with revenue rising to US$362.69 million while net income slipped to US$189.71 million, alongside higher diluted EPS from continuing operations of US$2.08, and declared a quarterly cash dividend of US$0.35 per share payable in September. Although profit was slightly lower than a year earlier, Essent’s ability to grow revenue and earnings per share while maintaining regular dividends highlights ongoing cost discipline and capital return efforts. We’ll now explore how Essent’s higher per-share earnings and ongoing dividend program may shape its existing investment narrative. The future of work is here. Discover the 37 top robotics and automation stocks leading the charge in AI-driven automation and industrial transformation. To own Essent Group, you need to believe in the long-term role of private mortgage insurance and the company’s ability to manage credit risk and capital prudently. The latest quarter showed higher revenue and EPS alongside slightly lower net income, which does not materially change the near term focus on housing affordability as a key catalyst or the ongoing risk that alternative credit models and fintech underwriting could pressure Essent’s traditional PMI franchise. The reaffirmed quarterly dividend of US$0.35 per share is the most directly relevant announcement, because it ties Essent’s capital return approach to its earnings power in a period of modest profit pressure. For investors watching catalysts, a steady dividend signals confidence in cash generation while the company continues to invest in AI and analytics initiatives that relate directly to its exposure to evolving underwriting technology. Yet investors should be aware that if alternative credit models and AI driven underwriting gain wider traction, Essent’s traditional business could... Read the full narrative on Essent Group (it's free!) Essent Group's narrative projects $1.6 billion revenue and $646.7 million earnings by 2029. This requires 7.0% yearly revenue growth and a $34.0 million earnings decrease from $680.7 million today. Uncover how Essent Group's forecasts yield a $72.00 fair value, a 5% upside to its current price. One member of the Simply Wall St Community currently estimates Essent’s fair value at US$167.15, far above the recent share price. You can set that single, bullish view against the ongoing risk that evolving fintech and AI underwriting models may pressure traditional mortgage insurance profitability over time, and then compare it with several other independent assessments. Explore another fair value estimate on Essent Group - why the stock might be worth over 2x more than the current price! Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts. A great starting point for your Essent Group research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision. Our free Essent Group research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Essent Group's overall financial health at a glance. Every day counts. These free picks are already gaining attention. See them before the crowd does: Capitalize on the AI infrastructure supercycle with our selection of the 56 best 'picks and shovels' of the AI gold rush converting record-breaking demand into massive cash flow. Find 52 companies with promising cash flow potential yet trading below their fair value. AI is about to change healthcare. These 43 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include ESNT. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Interested in Essent Group Ltd.? Here are five stocks we like better. Strong second-quarter performance: Essent Group reported $190 million in net income, or $2.08 per diluted share, supported by favorable credit trends, high mortgage-insurance persistency and higher investment income. Book value per share increased nearly 13% year over year to $63.01. Mortgage portfolio remains resilient but growth is constrained: Insurance in force rose 1.2% year over year to $249.7 billion, while the default rate held near 2.53% and 97% of insurance in force had reinsurance protection. Affordability pressures and subdued mortgage originations are limiting near-term portfolio expansion. Capital returns and diversification continue: Essent repurchased $191 million of shares in the quarter and had bought back nearly $350 million through July 31, while maintaining strong capital and liquidity. The company is also expanding its P&C reinsurance business and investing in AI and other technology initiatives. Essent Group (NYSE:ESNT) reported second-quarter 2026 net income of $190 million, or $2.08 per diluted share, as a benign credit environment, elevated mortgage-insurance persistency and higher investment income supported results. The company said its annualized return on average equity was 13.4% for the quarter. Book value per share stood at $63.01 as of June 30 and had grown nearly 13% over the prior year, including the common dividend. Chairman and Chief Executive Officer Mark Casale said the company views book value per share growth as its primary measure of success. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth “Cash generation from our core MI business remains strong,” Casale said, adding that the company has flexibility to allocate capital between franchise investments and shareholder returns. Insurance in force in Essent’s mortgage insurance business totaled $249.7 billion at June 30, up $1.8 billion from the end of the first quarter and $2.9 billion, or 1.2%, from a year earlier. Twelve-month persistency was 84%, compared with 84.7% at March 31. → Sandisk Just Delivered a Blowout Quarter—Here's Why the Stock Is Falling Casale said persistency remains supported by the interest-rate environment, noting that nearly half of the company’s in-force portfolio carries mortgage rates of 5.5% or less. At the same time, he said affordability constraints are likely to keep portfolio growth subdued in the near term because they continue to weigh on mortgage originations. The company’s mortgage insurance portfolio had a weighted-average credit score of 747 and weighted-average original loan-to-value ratio of 93%. Its default rate was 2.53% at June 30, essentially unchanged from the preceding quarter. Casale said embedded home equity within the portfolio should mitigate ultimate claims, while 97% of insurance in force is covered by reinsurance protection. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High Mortgage insurance premiums earned were $216 million during the second quarter. The average base premium rate was 40 basis points, down 1 basis point sequentially, while the average net premium rate was unchanged at 35 basis points. During the question-and-answer session, Casale said the company expects its average base premium rate to remain around 40 basis points this year and said any longer-term movement would likely be limited due to the weight and size of the existing insurance portfolio. He characterized the competitive environment as stable and said Essent focuses more on premium dollars and returns than market-share growth. Casale said the company has found opportunity in selected borrower segments, including areas with higher loan-to-value ratios or debt-to-income ratios, where he said competition can be less intense than in lower-risk borrower categories. The mortgage insurance provision for losses and loss adjustment expenses was $29.4 million, down from $37.6 million in the first quarter but above $15.3 million a year earlier. Mortgage insurance operating expenses were $31.9 million, down from $37.6 million in the first quarter, and the expense ratio improved to 14.8% from 17.4%. Chief Financial Officer David Weinstock said Essent Guaranty’s PMIERs sufficiency ratio was 172% at June 30, representing $1.5 billion of excess available assets. Essent Guaranty had statutory capital of $3.7 billion and a risk-to-capital ratio of 8.5-to-1, including $2.7 billion of contingency reserves. Weinstock said Essent Guaranty paid $115 million in dividends to its U.S. holding company year to date and could pay an additional $302 million in ordinary dividends during 2026 beginning July 1. At the consolidated level, Essent reported $6.6 billion in cash and investments, $5.7 billion in GAAP equity and $1.1 billion in cash and investments at the holding companies. The company also had access to $1 billion in excess-of-loss reinsurance. Holding-company liquidity included $500 million of undrawn revolver capacity, while senior unsecured notes outstanding totaled $500 million. Its debt-to-capital ratio was 8%. Essent’s reinsurance segment continued to expand through non-mortgage property-and-casualty business. Net premiums written in the first half totaled $249 million, compared with $31 million in the prior-year period, while net premiums earned increased to $73 million from $30 million. The reinsurance combined ratio was 77.9% in the second quarter, compared with 69.6% in the first quarter and 19.4% a year earlier. Weinstock said the change reflected expected differences between mortgage and non-mortgage underwriting performance as the business mix shifted. The segment’s pre-tax underwriting income remained predominantly tied to GSE and other mortgage risk-share business, with P&C activity not materially contributing during the quarter. Casale said Essent expects approximately $320 million of written premium from its P&C reinsurance activity in 2026, with about half earned this year at a combined ratio in the high 90s. He described the P&C business as a longer-term capital-allocation opportunity and said its exposure is concentrated in casualty and specialty lines, with limited property exposure. Consolidated net investment income rose 4% sequentially to $61.6 million. Income from other invested assets increased to $19.4 million from $10.2 million in the first quarter, primarily due to favorable fair-value adjustments. Casale said the company’s strategic-investment portfolio, focused on insurance, specialty finance and housing, totaled about $450 million, or 7% of total investments. Essent repurchased 3.2 million shares for $191 million during the second quarter and paid $31.6 million in shareholder dividends. Through July 31, the company had repurchased nearly 6 million shares for approximately $350 million. The board approved a third-quarter common dividend of $0.35 per share. Casale also said Essent is investing in technology, including artificial intelligence applications in analytics, risk management, information technology and title operations. He said the company sees AI as a way to improve pricing, claims processing, customer responsiveness and system-development cycle times rather than as a material near-term cost issue. In title insurance, Casale said high interest rates remain a modest near-term headwind and the business is not expected to make a meaningful earnings contribution in the near term. He said Essent continues to add lender relationships and build technology infrastructure, positioning the segment for a future recovery in housing activity and refinancings. Essent Group Ltd. (NYSE: ESNT) is a publicly traded insurance holding company specializing in private mortgage insurance and mortgage reinsurance solutions. Through its primary subsidiary, Essent Guaranty, the company provides credit protection to mortgage lenders, helping mitigate the risk of borrower default on residential mortgage loans. Essent's insurance policies enable lenders to offer low-down-payment programs, supporting homebuyers in achieving homeownership with reduced upfront equity requirements. Beyond traditional mortgage insurance, Essent offers a suite of risk management and analytics services designed to help financial institutions monitor and manage mortgage portfolios. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Essent Group Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Net Income: $190 million, or $2.08 per diluted share, for Q2 2026. Return on Average Equity: 13.4% annualized for Q2 2026. Book Value Per Share: $63.10 as of June 30, 2026, growing nearly 13% year-over-year including dividends. Insurance in Force: $250 billion in the mortgage insurance segment, up 1% year-over-year. Persistency: 84% for the 12 months ended June 30, 2026. Mortgage Insurance Premium: $216 million in Q2 2026. Average Base Premium Rate: 40 basis points for the mortgage insurance portfolio in Q2 2026. Average Net Premium Rate: 35 basis points, consistent with the prior quarter. Mortgage Insurance Losses and LAE: $29.4 million in Q2 2026, down from $37.6 million in Q1 2026. Default Rate: 2.53% on the mortgage insurance portfolio as of June 30, 2026, essentially flat quarter-over-quarter. Mortgage Insurance Operating Expenses: $31.9 million in Q2 2026, with an expense ratio of 14.8%. PMIERs Efficiency Ratio: 172% at Essent Guaranty, with $1.5 billion in excess available assets. Reinsurance Net Premiums Written: $249 million in the first half of 2026, up from $31 million in the first half of 2025. Reinsurance Net Premiums Earned: $73 million in the first half of 2026, up from $30 million in the first half of 2025. Reinsurance Combined Ratio: 77.9% in Q2 2026, compared to 69.6% in Q1 2026. Consolidated Net Investment Income: $61.6 million in Q2 2026, up 4% quarter-over-quarter. Income from Other Invested Assets: $19.4 million in Q2 2026, up from $10.2 million in Q1 2026. Consolidated Cash and Investments: $6.6 billion as of June 30, 2026, with an annualized aggregate investment yield of 4.9%. Operating Cash Flow: $834 million over the trailing 12 months. Share Repurchases: 3.2 million shares for $191 million in Q2 2026; nearly 6 million shares for approximately $350 million year-to-date through July 31, 2026. Dividend: $0.35 per common share approved for Q3 2026. Warning! GuruFocus has detected 5 Warning Signs with ESNT. Is ESNT fairly valued? Test your thesis with our free DCF calculator. Release Date: August 07, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Essent Group Ltd (NYSE:ESNT) reported strong Q2 2026 results with net income of $190 million or $2.08 per diluted share, translating to a 13.4% annualized return on average equity. Book value per share grew nearly 13% year-over-year to $63.10, and has compounded at approximately 18% annually since the IPO, reflecting strong long-term shareholder value creation. The company maintains a strong capital position with $5.7 billion in GAAP equity, $1.1 billion in cash and investments at the holding companies, and a PMIERs efficiency ratio of 172% with $1.5 billion in excess available assets. Essent Group Ltd (NYSE:ESNT) continues to return capital to shareholders, repurchasing nearly 6 million shares for approximately $350 million year-to-date and declaring a quarterly dividend of $0.35 per share. The credit quality of the insurance in force remains strong with a weighted average credit score of 747 and a weighted average original LTV of 93%, while the default rate was effectively flat quarter-over-quarter. The company's investment portfolio yield increased to 4.9% annually, with income from other invested assets rising to $19.4 million in Q2, up from $10.2 million in Q1, driven by favorable fair value adjustments. Essent Group Ltd (NYSE:ESNT) benefits from elevated persistency of 84% due to the current rate environment, supporting stable premium income and providing a natural hedge against lower origination volumes. Essent Group Ltd (NYSE:ESNT)'s insurance in force growth remains muted at only 1% year-over-year, reflecting the ongoing affordability constraints and high interest rates that continue to suppress origination volumes. The average base premium for the mortgage insurance portfolio declined by 1 basis point to 40 basis points, indicating potential pricing pressure in a competitive market. The reinsurance segment's combined ratio increased to 77.9% in Q2 2026 from 69.6% in Q1, reflecting the changing business mix and the impact of non-mortgage lines, which could pressure profitability. High interest rates remain a modest headwind for the title business, and the company does not expect title to have any meaningful impact on earnings in the near term. The P&C reinsurance business is still in its early stages, with written premium expected at $320 million for 2026 but a combined ratio in the high 90s, indicating limited profitability and potential for volatility. The company faces uncertainty regarding the adoption of VantageScore, which could introduce credit risk if lenders use it to 'game the system,' though management expects the GSEs to tighten any arbitrage over time. The prolonged slowdown in housing demand, which may not improve until the tail end of the decade, could continue to limit new insurance written and portfolio growth. Q: Can you discuss the competitive trends in the mortgage insurance market and the slight decline in the premium yield this quarter?A: Mark Casale, Chairman and CEO, stated that the premium yield is in line with their guidance of approximately 40 basis points for the year. He described the competitive environment as stable, noting that the GSEs' rules prevent credit competition, which is a positive for the industry. He explained that while market share is distributed among players based on their appetites, the overall economics are similar. Essent focuses on premium dollars rather than just market share, which is why its earned premium yield is higher than the industry average. Q: Is there any credit risk to be worried about as VantageScore gains momentum in the market?A: Mark Casale, Chairman and CEO, acknowledged that VantageScore is more lenient than FICO but expects the GSEs to tighten any arbitrage over time. He noted that higher scores could shift borrowers from FHA to conventional loans, which is a net positive for the market. Essent is relatively score-agnostic because its underwriting engine uses over 400 variables, not just credit scores. He does not see a significant number of new borrowers coming off the sidelines due to this change. Q: What is the outlook for the premium yield over the next year or two, and is 40 basis points a floor?A: Mark Casale, Chairman and CEO, explained that the premium yield is complex to project due to the embedded nature of the existing book. He expects it may decline slightly over the next couple of years but not significantly. He highlighted that Essent increased premium on new insurance written by 10% in the second quarter by taking on a bit more risk, reflecting the company's strategy of seeking premium value rather than just market share. Q: Did you grow new insurance written faster than the industry this quarter, and were there specific pockets of opportunity?A: Mark Casale, Chairman and CEO, confirmed that Essent grew NIW faster than the industry. He attributed this to the company's focus on segments with less competition, such as higher DTI or higher LTV loans, where there is more pricing power. He noted that while the 780 credit score market is highly competitive, Essent finds more value in other borrower segments and geographies. Q: How is Essent approaching AI and token usage within the organization?A: Mark Casale, Chairman and CEO, stated that token usage is robust but the cost is immaterial relative to operating expenses. He outlined three main areas of AI adoption: as an analytical tool for senior management, improving risk analytics and cycle times, and enhancing coding efficiency in IT. He emphasized that AI is complementary, not a replacement for judgment, and that the company's modular cloud-based system positions it well to leverage AI for better pricing, faster claims, and improved customer response times. He also sees significant potential for AI in the title business to reduce processing costs. Q: Can you provide details on the P&C reinsurance business, including any meaningful catastrophe exposure and the underlying risk in the casualty book?A: Mark Casale, Chairman and CEO, explained that the P&C book consists of two parts: a Lloyd's book, which is well-diversified across 45-plus syndicates with about 15% property exposure, and a quota share with over 400 cedents, mostly casualty and specialty. He noted that the loss picks are conservative and the business is treated as an investment to stack float. He emphasized that the P&C business is a "call option" for capital deployment, similar to title and strategic investments, and that building infrastructure during a soft market positions the company for future opportunities. Q: Do we need to see affordability dynamics meaningfully shift for the NIW opportunity to improve, or is housing demand adjusting to the rate environment?A: Mark Casale, Chairman and CEO, stated that affordability must improve, driven by income growth, interest rates, or HPA. He explained that the current lull is an after-effect of the 2021 period when demand was pulled forward. He believes the longer the slowdown lasts, the stronger the recovery will be, as pent-up demand from young homebuyers continues to build. He expects the market to improve toward the tail end of the decade. Q: Is the right way to think about subsidiary dividend capacity that it grows alongside the scheduled contingency reserve releases?A: Mark Casale, Chairman and CEO, confirmed that dividend capacity from Essent Guaranty is tied to the release of contingency reserves. He noted that the business written in 2017-2021 created a "bubble" of increased contingency reserves that will release over the next few years, providing significant dry powder for capital distribution. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

HAMILTON, Bermuda, Aug. 07, 2026 (GLOBE NEWSWIRE) -- Essent Group Ltd. (NYSE: ESNT) today reported net income for the quarter ended June 30, 2026 of $189.7 million or $2.08 per diluted share, compared to $195.3 million or $1.93 per diluted share for the quarter ended June 30, 2025. Essent also announced today that its Board of Directors has declared a quarterly cash dividend of $0.35 per common share. The dividend is payable on September 10, 2026 to shareholders of record on August 31, 2026. “We are pleased with our second quarter 2026 financial results, which reflect strong profitability, continued growth in book value per share and the resilience of our operating model,” said Mark A. Casale, Chairman and Chief Executive Officer. “The consistent cash flow generation of our mortgage insurance business, combined with our strong capital position, allows us to take a balanced approach to capital management and to continue creating long-term value for our shareholders.” Financial Highlights: Mortgage new insurance written for the second quarter of 2026 was $14.1 billion, compared to $11.1 billion in the first quarter of 2026 and $12.5 billion in the second quarter of 2025. Mortgage insurance in force as of June 30, 2026 was $249.7 billion, compared to $247.9 billion as of March 31, 2026 and $246.8 billion as of June 30, 2025. Reinsurance net premiums written for the first half of 2026 were $248.8 million, compared to $30.6 million in the first half of 2025. Net investment income for the first half of 2026 was $120.9 million, compared to $117.5 million in the first half of 2025. Year-to-date through July 31, 2026, Essent repurchased 5.8 million common shares for $348 million. Conference Call: Essent management will hold a conference call at 10:00 AM Eastern time today to discuss its results. The conference call will be broadcast live over the Internet at http://ir.essentgroup.com/events-and-presentations/events/default.aspx. The call may also be accessed by dialing 888-330-2384 inside the U.S., or 240-789-2701 for international callers, using passcode 9824537 or by referencing Essent. A replay of the webcast will be available on the Essent website approximately two hours after the live broadcast ends for a period of one year. A replay of the conference call will be available approximately two hours after the call ends for a period of two weeks, using the following dial-in numbers and passcode: 800-770-2030 inside the U.S., or 647-362-9199 for international callers, passcode 9824537. In addition to the information provided in the Company's earnings news release, other statistical and financial information, which may be referred to during the conference call, will be available on Essent's website at http://ir.essentgroup.com/financials/quarterly-results/default.aspx. Forward-Looking Statements: This press release may include “forward-looking statements” which are subject to known and unknown risks and uncertainties, many of which may be beyond our control. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," “should,” “expect,” "plan," "anticipate," "believe," “estimate,” “predict,” or "potential" or the negative thereof or variations thereon or similar terminology. Actual events, results and outcomes may differ materially from our expectations due to a variety of known and unknown risks, uncertainties and other factors. Although it is not possible to identify all of these risks and factors, they include, among others, the following: changes in or to Fannie Mae and Freddie Mac (the “GSEs”), whether through Federal legislation, restructurings or a shift in business practices; failure to continue to meet the mortgage insurer eligibility requirements of the GSEs; competition for customers or the loss of a significant customer; lenders or investors seeking alternatives to private mortgage insurance; an increase in the number of loans insured through Federal government mortgage insurance programs; decline in the volume of low down payment mortgage originations; uncertainty of loss reserve estimates; decrease in the length of time our insurance policies are in force; deteriorating economic conditions; and other risks and factors described in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the Securities and Exchange Commission on February 18, 2026, as subsequently updated through other reports we file with the Securities and Exchange Commission. Any forward-looking information presented herein is made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise. About the Company: Essent Group Ltd. (NYSE: ESNT) is a Bermuda-based holding company (collectively with its subsidiaries, “Essent”) offering private mortgage insurance, reinsurance, and title insurance and settlement services to serve the housing finance industry. Additional information regarding Essent may be found at www.essentgroup.com. Source: Essent Group Ltd. Media Contact [email protected] Investor Relations ContactPhilip StefanoVice President, Investor [email protected] Management believes Book Value Per Share Inclusive of Common Dividends provides investors with useful supplemental information because it reflects both changes in GAAP book value per share and cash dividends distributed to common shareholders. Management uses this measure as an additional indicator of per-share capital generation and capital return. Because dividends paid to common shareholders reduce GAAP book value per share, management believes this measure helps investors evaluate the combined effect of retained capital growth and capital distributed to shareholders during the period. The following table sets forth the reconciliation of Book Value per Share Inclusive of Common Dividends to the most comparable GAAP amount as of June 30, 2026, as well as the 12-month growth in Book Value per Share Inclusive of Common Dividends in accordance with Regulation G.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributes strong cash generation to a benign credit environment and the 'Buy, Manage & Distribute' operating model, which provides high-quality earnings across economic cycles. Persistency remains elevated at 84% because nearly half of the In Force portfolio carries a mortgage rate of 5.5% or lower, creating a natural hedge against declining origination volumes. Portfolio growth is currently in a 'pause' phase as high interest rates and home price appreciation continue to constrain borrower affordability and pull forward demand from previous years. The credit profile remains robust with a weighted average credit score of 747, while embedded home equity is expected to mitigate ultimate claims despite a flat quarter-over-quarter default rate. Strategic positioning in the MI segment focuses on 'premium seekers' rather than pure market share, intentionally avoiding low-premium/high-share segments like 85% LTV and below. The Title segment is viewed as a capital-light opportunity to deepen lender relationships, though management does not expect it to meaningfully impact earnings in the near term due to high interest rates. Reinsurance expansion into P&C lines is designed to stack 'float' and diversify capital allocation, with current books weighted toward casualty and specialty risks requiring minimal incremental capital. Management expects written premium for P&C reinsurance to reach approximately $320 million for 2026, with a combined ratio projected in the high 90s. Persistency levels are expected to remain supported by the current rate environment, though Insurance in Force growth will likely remain muted until affordability improves. The company anticipates a significant increase in dividend capacity from Essent Guaranty over the next few years as contingency reserves from the 2020-2021 'bubble' are released. Strategic investments in technology, particularly AI and modular cloud systems, are expected to improve pricing accuracy, claim processing speed, and title search efficiency over the next few years. Long-term housing demand is expected to remain positive due to favorable demographics, with Management believes favorable demographics and pent-up demand will benefit the mortgage insurance business once affordability improves, though they currently expect portfolio growth to remain paused. The company repurchased nearly 6 million shares for approximately $350 million year-to-date through July 31, reflecting a commitment to returning capital to shareholders. Other invested assets now total $450 million (7% of the portfolio), providing a mechanism to deploy capital outside core MI and Reinsurance to drive book value growth. 97% of Insurance in Force is subject to reinsurance protection, which management highlights as a critical tool for capital relief and tail risk reduction. Management identified the transition to VantageScore as a potential market shift but remains 'score agnostic' due to their proprietary EDGE engine using over 400 variables. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management guided to a stable premium yield of approximately 40 basis points for the year, noting that they prioritize premium dollars over market share. The competitive environment is described as stable with no real 'credit competition' because the GSEs set the primary guardrails for insurable loans. Management expects the GSEs to tighten any perceived 20-point gap between FICO and VantageScore over time to eliminate arbitrage opportunities. Essent remains relatively agnostic to specific credit scores because their internal pricing engine relies on a much broader set of 400+ variables. The P&C book is viewed as a 'call option' to stack float, with 70% of the quota share business focused on casualty lines like general liability and workers' comp. Management is using the current soft market to build infrastructure and gather data from loss triangles dating back to 2005 to inform future scaling. AI is being utilized as an analytical tool for risk modeling and to accelerate IT coding, with token costs currently described as 'immaterial' relative to potential gains. Management sees the greatest AI potential in the Title segment for automating search and exam processes to lower borrower costs.