Trade-Ideas LLC identified MGIC Investment ( MTG) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified MGIC Investment as such a stock due to the following factors:

  • MTG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $46.1 million.
  • MTG has traded 1.2 million shares today.
  • MTG is trading at 2.10 times the normal volume for the stock at this time of day.
  • MTG is trading at a new high 3.01% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on MTG:

MGIC Investment Corporation, through its subsidiaries, provides private mortgage insurance and ancillary services to lenders and government sponsored entities in the United States. MTG has a PE ratio of 1. Currently there are 2 analysts that rate MGIC Investment a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for MGIC Investment has been 4.8 million shares per day over the past 30 days. MGIC Investment has a market cap of $3.3 billion and is part of the financial sector and insurance industry. The stock has a beta of 2.33 and a short float of 11.6% with 8.40 days to cover. Shares are up 3.3% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates MGIC Investment as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and expanding profit margins. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 8.2%. Since the same quarter one year prior, revenues slightly increased by 5.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Thrifts & Mortgage Finance industry and the overall market, MGIC INVESTMENT CORP/WI's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • MGIC INVESTMENT CORP/WI reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, MGIC INVESTMENT CORP/WI turned its bottom line around by earning $0.64 versus -$0.23 in the prior year. This year, the market expects an improvement in earnings ($0.99 versus $0.64).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Thrifts & Mortgage Finance industry. The net income increased by 149.7% when compared to the same quarter one year prior, rising from $45.52 million to $113.65 million.

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