Long term potential:
Based on current projection and after the FHFA allows homeowners who are delinquent 90 days, achance to refinance to lower rates; MGIC could return to 2006 operating potential. MGIG earned $500 million a year then.
FHFA New policy takes place on July 1, 2013.
TG, appreciate your input and been a fan of your factual posts. I have anticipated 1Q results to stabilize MGIC, but the 2Q results to be the real fundamental ignition for this stock. In 2Q, MGIC will have at their disposal the full new capital to write new business, they will no longer have to answer questions about risk ratios, new increased rates for FHA will be in effect whole quarter, and I would be surprised if CW isn't finally announced. I don't see adjustments to reducing reserves or DTA being contemplated until late 13. So my question, $6 seems a little light to me by September, curious your thoughts on why $6? I had been thinking closer to $7.
TG, does this mean you only expect a 10% bump after positive earnings, which would then stay flat during May? Does anyone know what the short interest is? My view is that if MTG reports positive earnings, short covering alone should catapult this over 6 and test new 52 week high. Thoughts?
Sentiment: Strong Buy