The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Radian Group crushed expectations on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly, and GAAP loss per share dropped.
Margins contracted across the board.
Radian Group booked revenue of $364.6 million. The four analysts polled by S&P Capital IQ expected net sales of $229.3 million on the same basis. GAAP reported sales were 1269% lower than the prior-year quarter's -$31.2 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at -$1.97. The five earnings estimates compiled by S&P Capital IQ forecast -$0.94 per share on the same basis. GAAP EPS were -$0.92 for Q4 versus -$8.55 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was -1.0%, 146,640 basis points worse than the prior-year quarter. Operating margin was -11.5%, 163,270 basis points worse than the prior-year quarter. Net margin was -33.3%, 365,870 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $226.6 million. On the bottom line, the average EPS estimate is -$0.51.
Next year's average estimate for revenue is $906.8 million. The average EPS estimate is -$1.52.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 404 members rating the stock outperform and 179 members rating it underperform. Among 158 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 89 give Radian Group a green thumbs-up, and 69 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Radian Group is hold, with an average price target of $5.50.
Over the decades, small-cap stocks, like Radian Group have provided market-beating returns, provided they're value priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.
- Add Radian Group to My Watchlist.