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 Radian Group (NYSE: RDN), a provider of mortgage insurance coverage, soared as much as 17% after reporting much better-than-expected third-quarter earnings results.

So what: For the quarter, Radian Group reported a 49% decline in revenue to $260.8 million over the previous year, and a profit of $0.11 per share (its first profit in 2012). That may not sound very strong, but all things considered, Radian crushed Wall Street's estimates for $224.6 million in revenue and an expected loss of $0.52. That is indeed an EPS beat of $0.63 when all is said and done. In addition to writing $10.6 billion in mortgage insurance this quarter, Radian recorded a fair value derivative gain of $41.8 million and a net gain on investments of $84.7 million.

Now what: This is a good first step for Radian, but it still has a long way to go before I'd give the company anywhere near a clean bill of health. Radian's underwritings prior to the recession weren't the highest quality, and it's still dealing with the legacy risks of those assets. If Radian can show me a few more profitable quarters like this, where mortgage insurance underwriting goes up by double-digits, then I'd be willing to give the company another look. In the meantime, I wouldn't allow today's large move higher to suck you into a long and drawn-out turnaround story.

Craving more input? Start by adding Radian Group to your free and personalized watchlist so you can keep up on the latest news with the company.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.