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MGIC Investment Graham Number

: $23.47 (As of Jun. 2021)
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Graham Number is a figure that measures a stock's fundamental value by taking into account the company's earnings per share and book value per share. The Graham number is the upper bound of the price range that a defensive investor should pay for the stock. According to the theory, any stock price below the Graham number is considered undervalued, and thus worth investing in.

As of today (2021-10-21), the stock price of MGIC Investment is $16.40. MGIC Investment's graham number for the quarter that ended in Jun. 2021 was $23.47. Therefore, MGIC Investment's Price to Graham Number ratio for today is 0.70.

The historical rank and industry rank for MGIC Investment's Graham Number or its related term are showing as below:

NYSE:MTG' s Price-to-Graham-Number Range Over the Past 10 Years
Min: 0.28   Med: 1   Max: 2.4
Current: 0.7

0.28
2.4

During the past 13 years, the highest Price to Graham Number ratio of MGIC Investment was 2.40. The lowest was 0.28. And the median was 1.00.

NYSE:MTG's Price-to-Graham-Number is ranked higher than
76% of the 149 Companies
in the Insurance industry.

( Industry Median: 0.95 vs. NYSE:MTG: 0.70 )

Graham Number is a combination of asset valuation and earnings power valuation. It is a very conservative way of valuing a stock.


MGIC Investment Graham Number Historical Data

The historical data trend for MGIC Investment's Graham Number can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

MGIC Investment Annual Data
Trend Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20
Graham Number
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 12.03 13.49 20.09 22.73 20.07

MGIC Investment Quarterly Data
Sep16 Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21
Graham Number Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 20.48 19.97 19.99 20.12 23.47

Competitive Comparison

For the Insurance - Specialty subindustry, MGIC Investment's Graham Number, along with its competitors' market caps and Graham Number data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

MGIC Investment Graham Number Distribution

For the Insurance industry and Financial Services sector, MGIC Investment's Graham Number distribution charts can be found below:

* The bar in red indicates where MGIC Investment's Graham Number falls into.



MGIC Investment Graham Number Calculation

Graham Number is a concept based on Ben Graham's conservative valuation of companies.

MGIC Investment's Graham Number for the fiscal year that ended in Dec. 2020 is calculated as

Graham Number
=sqrt of (22.5* Tangible Book per Share *EPS without NRI)
=sqrt of (22.5*13.879*1.29)
=20.07

MGIC Investment's Graham Number for the quarter that ended in Jun. 2021 is calculated as

Graham Number
=sqrt of (22.5*Tangible Book per Share*EPS without NRI (TTM))
=sqrt of (22.5*14.484*1.69)
=23.47

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


MGIC Investment  (NYSE:MTG) Graham Number Explanation

Ben Graham actually did not publish a formula like this. But he wrote in The Intelligent Investor (1948 version) regarding to the criteria for purchases:

Current price should not be more than 15 times average earnings of the past three years.

Current price should not be more than 1.5 times the book value last reported. However, a multiplier of earnings below 15 could justify a correspondingly higher multiplier of assets. As a rule of thumb we suggest that the product of the multiplier times the ratio of price to book value should not exceed 22.5. (This figure corresponds to 15 times earnings and 1.5 times book value. It would admit an issue selling at only 9 times earnings and 2.5 times asset value, etc.)

Unlike valuation methods such as DCF or Discounted Earnings, the Graham number does not take growth into the valuation. Unlike the valuation methods based on book value alone, it takes into account the earnings power. Therefore, the Graham Number is a combination of asset valuation and earnings power valuation.

In general, the Graham number is a very conservative way of valuing a stock. It cannot be applied to companies with negative book values.

MGIC Investment's Price to Graham number Ratio for today is calculated as

Price to Graham number=Share Price (Today)/Graham number (Q: Jun. 2021 )
=16.40/23.47
=0.70

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Be Aware

Please keep these in mind:

1. Graham Number does not take growth into account. Therefore it underestimates the values of the companies that have good earnings growth. We feel that if the earnings per share grows more than 10% a year, Graham Number underestimates the value.
2. Graham Number punishes the companies that have temporarily low earnings. Therefore, an average of earnings makes more sense in the calculation of Graham Number.
3. Graham Numbers underestimates companies that are light with book.


MGIC Investment Graham Number Related Terms

Thank you for viewing the detailed overview of MGIC Investment's Graham Number provided by GuruFocus.com. Please click on the following links to see related term pages.


MGIC Investment Business Description

MGIC Investment logo
Industry
Financial Services » Insurance NAICS : 524126 SIC : 6351
Traded in Other Exchanges
Address
MGIC Plaza, 250 East Kilbourn Avenue, Milwaukee, WI, USA, 53202
MGIC Investment Corp provides private mortgage insurance and other services to mortgage lenders, covering them against defaults by homeowners on residential mortgages. The insurance premiums that these customers pay for the protection accounts for close to 90% of the company's total revenue. Investment income accounts for most of the remaining revenue. The company sells its insurance products in all 50 states of the United States and in Puerto Rico. Its greatest exposure is in California, Florida, Texas, Pennsylvania, and Ohio.
Executives
Kozlak Jodee A director 1000 NICOLLET MALL, TPS-3255 MINNEAPOLIS MN 55403
Poliner Gary A. director C/O MGIC INVESTMENT CORPORATION 250 EAST KILBOURN AVENUE MILWAUKEE WI 53202
Jastrow Kenneth M Ii director 6300 BEE CAVE ROAD BUILDING TWO, STE 500 AUSTIN TX 78746
Hartzell Jay C. director 250 EAST KILBOURN AVENUE MILWAUKEE WI 53202
Sculley Sheryl L. director 250 EAST KILBOURN AVENUE MILWAUKEE WI 53202
Arrigoni Daniel A. director C/O MGIC INVESTMENT CORPORATION 250 E KILBOURN AVE MILWAUKEE WI 53202
Zandi Mark director MGIC PLAZA 250 EAST KILBOURN AVENUE MILWAUKEE WI 53202
Lehman Michael E director PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"> Ownership Information: LEHMAN MICHAEL E a.header:link {color: #3b4fae; font-weight: bold; text-decoration: underline;} a.header:visited {color: #3b4fae; font-weight: bold; text-decoration: underline;} a.header:hover {color: #191970;}
Chaplin C Edward director C/O MBIA 113 KING STREET ARMONK NY 10504
Holt Timothy A director C/O VIRTUS INVESTMENT PARTNERS, INC. 100 PEARL STREET HARTFORD CT 06103
Culver Curt S director 250 E KILBOURN AVE MILWAUKEE WI 53202
Lora Melissa director C/O KB HOME 10990 WILSHIRE BOULEVARD, 7TH FLOOR LOS ANGELES CA 90024
Maggio Paula C officer: EVP and General Counsel C/O STRATEGIC HOTEL CAPITAL, INC. 77 WEST WACKER DRIVE, STE 4600 CHICAGO IL 60601
Thompson Steven M. officer: EVP&CRO-Mort Gty Ins Corp 250 EAST KILBOURN AVENUE MILWAUKEE WI 53202
Candelmo Robert J officer: SVP-CIO of Mort Gty Ins Corp 250 EAST KILBOURN AVENUE MILWAUKEE WI 53202

MGIC Investment Headlines

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