MeritValue

MGIC INVESTMENT CORP

MTGdata completeness 88%18 fiscal years on file
The thesis, from the filings

MGIC INVESTMENT CORP earns about 15% on invested capital, comfortably above its ~9% cost of capital, and has bought back 33% of its shares over 5 years — the marks of a durable business run for its owners. The estimate methods put fair value between $32.54 and $48.56 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$1.19B1$1.17B2$1.16B3$1.21B3$1.21B3
Net income$635M4$865.3M5$712.9M6$763M6$738.3M6
Operating cash flow$696.3M7$650M8$713M9$725M9$852.8M9
Capital expenditure$4.12M10$3.25M11$2M12$1.17M12$1.03M12
Free cash flow (derived)$692.2M7$646.8M8$711M9$723.9M9$851.8M9
Total debt$1.15B13$662.8M14$643.2M14——
Cash & equivalents$284.7M15$327.4M16$363.7M17$229.5M18$369M18
Diluted shares351.3M311.2M287.2M264.0M235.1M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$218.95
your share of equity
Profit it earned you last year
$31.41
Free cash flow it threw off
$36.23
Debt you’d be carrying
—

10 shares is a claim on $218.95 of net worth that earned you $31.41 and generated $36.23 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
15% avg · 5y
FY21 12%FY22 18%FY23 14%FY24 16%FY25 16%

It earned about 15% on invested capital against a ~9% cost of capital — comfortably above the cost of funding, a moderate advantage.

seeing a moat in the numbers →
Management signal · capital allocation
−33% shares · 5y

Share count is down 33% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has fallen 44% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $32.54 and $48.56 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$47.09
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth1.5%
  • fcfBase$723.9M
DCF · Growth Exit 5Y
$48.56
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth1.5%
  • fcfBase$723.9M
Earnings Power Value
$32.54
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$738.3M
  • growthAssumed0.0%
Graham Number
$39.33
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years1.5%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $48.56
The three cases
Bear0.0%$45.56
Base1.5%$48.56
Bull6.5%$59.8

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 1.5%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000876437-24-000024 (Revenues)
  2. 10-K · period ending 2022-12-31 · accession 0000876437-25-000036 (Revenues)
  3. 10-K · period ending 2023-12-31 · accession 0000876437-26-000010 (Revenues)
  4. 10-K · period ending 2021-12-31 · accession 0000876437-24-000024 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000876437-25-000036 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000876437-26-000010 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000876437-24-000024 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000876437-25-000036 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0000876437-26-000010 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000876437-24-000024 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000876437-25-000036 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0000876437-26-000010 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0000876437-23-000013 (LongTermDebt)
  14. 10-K · period ending 2022-12-31 · accession 0000876437-24-000024 (LongTermDebt)
  15. 10-K · period ending 2021-12-31 · accession 0000876437-23-000013 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2022-12-31 · accession 0000876437-24-000024 (CashAndCashEquivalentsAtCarryingValue)
  17. 10-K · period ending 2023-12-31 · accession 0000876437-25-000036 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2024-12-31 · accession 0000876437-26-000010 (CashAndCashEquivalentsAtCarryingValue)