Analyst Lowers FY2024 EPS Estimates for Essent Group

On November 4, 2024, Roth Capital announced that it has revised its earnings per share (EPS) estimates for Essent Group Ltd. (NYSE:ESNT). In a research note directed at investors, analyst H. Fong revealed that the new forecast for Essent Group's FY2024 EPS is now set at $6.95, down from the previous estimate of $7.05.

Currently, the consensus among analysts also projects Essent Group's full-year earnings to be $6.95 per share. Additionally, Roth Capital has provided earnings forecasts for the upcoming quarters: for Q4 2025, an EPS of $1.76; for Q1 2026, an EPS of $1.73; for Q2 2026, an EPS of $1.77; and for Q3 2026, an EPS of $1.79. Their estimate for the total earnings for FY2026 stands at $7.10.

Analyst Ratings Updates

In recent weeks, other equity research analysts have updated their perspectives on Essent Group. The Goldman Sachs Group lowered its price target from $68.00 to $60.00 while maintaining a “neutral” rating. Royal Bank of Canada reduced its price target from $73.00 to $67.00, issuing an “outperform” rating. Likewise, JPMorgan Chase & Co. decreased their target price to $67.00 from $68.00, also maintaining a “neutral” rating.

Conversely, Keefe, Bruyette & Woods upgraded Essent Group from a “market perform” to an “outperform” rating, increasing their price target from $65.00 to $70.00. BTIG Research, on the other hand, raised its price target from $61.00 to $64.00, attributing a “buy” rating to the company. Overall, four analysts recommend holding the stock, while another four suggest buying it, resulting in a consensus rating of “Moderate Buy” with an average price target around $65.00.

Current Stock Performance

As of November 8, 2024, shares of Essent Group are trading at approximately $55.24. The company boasts a market capitalization of $5.87 billion, a price-to-earnings (P/E) ratio of 8.01, and a price-to-earnings-growth (PEG) ratio of 1.78. Essent Group’s stock has seen a one-year low of $47.56 and a high of $65.33. Its moving averages are currently at $62.43 (50-day) and $59.34 (200-day).

Quarterly Earnings Report

Recently, Essent Group released its quarterly earnings, reporting $1.65 EPS, which fell short of analysts’ expectations of $1.73 by $0.08. The company reported a significant return on equity of 13.81% and a net profit margin of 60.15%. Revenue for the quarter hit $3.17 billion, far exceeding the expected $316.80 million, and representing a remarkable year-over-year increase of 969.2%.

Dividend Announcement

On another note, Essent Group has declared a quarterly dividend of $0.28 per share, payable on December 11, 2024. The record date to receive this dividend is set for December 2, 2024. With this dividend, the annualized yield stands at 2.03%, and the payout ratio for the company is 16.23%.

Insider Transactions

In related corporate activity, CFO David B. Weinstock sold 2,000 shares of Essent Group on September 18, bringing in approximately $127,180. Despite the sale, Weinstock still retains direct ownership of 25,416 shares, valued at around $1.62 million. This transaction indicates a negligible reduction in his holdings. Insider ownership of the stock currently amounts to 3.20%.

Institutional Holdings

Various institutional investors have been adjusting their stakes in Essent Group. For example, BNP Paribas Financial Markets increased its stake by an impressive 86.4% in the first quarter, now holding 65,061 shares valued at about $3.87 million. Other hedge funds like Janney Montgomery Scott LLC and Capstone Investment Advisors LLC also made significant adjustments to their positions during the first quarter. Currently, institutional investors own approximately 93.00% of Essent Group's stock.

Company Overview

Essent Group Ltd. operates a range of services through its subsidiaries, focusing on providing private mortgage insurance and reinsurance for residential properties in the United States. The company’s offerings include a variety of mortgage insurance products as well as IT services, customer support, underwriting consulting, and risk management products.

EPS, Estimates, Analyst