The 10-second takeaway
For the quarter ended March 31 (Q1), MGIC Investment crushed expectations on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP loss per share dropped.
Margins increased across the board.
MGIC Investment booked revenue of $379.7 million. The five analysts polled by S&P Capital IQ expected sales of $310.7 million on the same basis. GAAP reported sales were 8.8% higher than the prior-year quarter's $362.1 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 -$0.48. The six earnings estimates compiled by S&P Capital IQ averaged -$0.37 per share on the same basis. GAAP EPS were -$0.10 for Q1 against -$0.17 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 1.6%, 320 basis points better than the prior-year quarter. Operating margin was 1.6%, 320 basis points better than the prior-year quarter. Net margin was -5.0%, 430 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $306.6 million. On the bottom line, the average EPS estimate is -$0.31.
Next year's average estimate for revenue is $1.22 billion. The average EPS estimate is -$1.41.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 307 members out of 496 rating the stock outperform, and 189 members rating it underperform. Among 170 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 89 give MGIC Investment a green thumbs-up, and 81 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on MGIC Investment is outperform, with an average price target of $5.00.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.