Radian Shares Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of mortgage insurer Radian (NYSE: RDN  ) were soaring today, gaining as much as 16% in intraday trading on renewed investor optimism.

So what: What happens when multiple large competitors are unceremoniously removed from your industry? Good things, that's what.

For both Radian and competitor MGIC Investment (NYSE: MTG  ) , the future looks a heck of a lot brighter ever since regulators told rivals Old Republic (NYSE: ORI  ) and PMI Group (NYSE: PMI  ) to stop writing new mortgage insurance policies. Radian's CEO, S.A. Ibrahim, said it well at an investment conference today: "While it's unfortunate that two worthy competitors are not writing business anymore, for those of us writing business still, it means there's more business to write." Helping to drive the optimism was a release from MGIC saying that it wrote $1.3 billion in new policies in August, up 8% from the prior month.

Now what: It seems plenty premature to think all of the fallout from the housing crisis is behind us -- particularly when you consider what's going on at Bank of America (NYSE: BAC  ) . However, for two severely beaten-down stocks like Radian and MGIC, even a little good news can go a long way.

Want to keep up to date on these companies?

The Motley Fool owns shares of Bank of America. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Matt Koppenheffer owns shares of Bank of America but has nofinancial interest in any of the other companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter, where he goes by @KoppTheFool, or on Facebook. The Fool’s disclosure policy prefers dividends over a sharp stick in the eye.


Read/Post Comments (0) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1549811, ~/Articles/ArticleHandler.aspx, 8/21/2014 6:10:30 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement