As an insurance company, RDN has a large reserve for potential losses, which acts the same as debt. Just looking at cash vs. debt is inadequate review for an insurance co. Having said that, RDN is selling a lot more profitable mortgage insurance as the housing recovery picks up.
That is true, thanks. But they do buy insurance to cover catastrophic losses. It seems to me that their level of cash on hand is significantly higher than other insurance companies. I think this stock is significantly undervalued. The price has been going up consistently over several months.
Take a look at HCI. It is a great company with cash $141 million and Market cap of $233m. It is a different type of market but still insurance. I bought HCI 1 year ago and have bought and sold it 6 times and made $58K. I just sold it. I'll buy back in around $20.