Insider Steps-Up on MGIC Investment (MTG) After Free-Fall In Stock
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After last week's death spiral-like sell-off, shares of MGIC Investment Corp. (NYSE: MTG) are jumping higher Monday as investors react to a insider purchase of 75,000 shares from CFO J. Michael Lauer on 8/6 at $0.89.
Shares of MTG sold off 64 percent on Thursday of last week on liquidity and capital concerns following second quarter results, which showed a large loss of $1.36 per share, versus a loss of $0.75 last year.
Despite the worries, Compass Point analyst Jason Stewart thinks there is value still in MTG given, "our view of the importance of mortgage insurance to US housing finance, substantial claims paying resources at MTG's operating subsidiary (MGIC), strong lender relationships and our view for a slow but moderate recovery in housing." He warns, however, there are significant uncertainty to their forecasts, specifically in their projection for incurred losses through YE12.
Share of MTG are up 12.6 percent early Monday to $0.95.
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Shares of MTG sold off 64 percent on Thursday of last week on liquidity and capital concerns following second quarter results, which showed a large loss of $1.36 per share, versus a loss of $0.75 last year.
Despite the worries, Compass Point analyst Jason Stewart thinks there is value still in MTG given, "our view of the importance of mortgage insurance to US housing finance, substantial claims paying resources at MTG's operating subsidiary (MGIC), strong lender relationships and our view for a slow but moderate recovery in housing." He warns, however, there are significant uncertainty to their forecasts, specifically in their projection for incurred losses through YE12.
Share of MTG are up 12.6 percent early Monday to $0.95.
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