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How Does MGIC Investment Compare to Its Peers?

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Nov. 20 2020, Updated 3:35 p.m. ET

MGIC Investment and its peers

An analysis of MGIC and its peers follows:

  • The forward PE (price-to-earnings) ratios of MGIC Investment (MTG), Old Republic International (ORI), Radian Group (RDN), Essent Group (ESNT), and Arch Capital Group (ACGL) are 10.20x, 14.91x, 9.86x, 11.76x, and 18.71x, respectively.

  • The PBV (price-to-book value) ratios of MGIC, Old Republic, Radian, Essent, and Arch Capital are 2.73x, 1.10x, 1.38x, 2.31x, and 1.61x, respectively.

According to the above findings, the peers outperformed MGIC based on the forward PE ratio. However, MGIC Investment is way ahead of its peers based on the PBV ratio.

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ETFs that invest in MGIC 

The PowerShares DWA Financial Momentum Portfolio (PFI) invests 3.9% of its holdings in MGIC. PFI tracks an index of US financial firms selected and weighted by price momentum.

The KBE Bank Fund (KBE) invests 1.6% of its holdings in MGIC. KBE tracks an equal-weighted index of US banking firms.

The PowerShares KBW Insurance Portfolio (KBWI) invests 1.5% of its holdings in MGIC. KBWI tracks a modified market-cap-weighted index of large-cap insurance companies.

Comparing MGIC and its ETFs

An analysis of MGIC and its ETFs follows:

  • The YTD (year-to-date) price movements of MGIC and KBE are 67% and -0.16%, respectively.
  • The PE ratios of MGIC, PFI, KBE, and KBWI are 10.72x, 16.45x, 14.01x, and 11.93x, respectively.
  • The PBV ratios of MGIC, PFI, KBE, and KBWI are 2.73x, 2.49x, 1.21x, and 1.19x, respectively.

According to the above findings, the peers are way ahead of MGIC based on the PE ratio. However, MGIC outperformed its peers based on the price movement and PBV ratio.

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