Essent Group (NYSE: ESNT), a leading provider of mortgage insurance and reinsurance, saw its stock price plummet 5.10% in pre-market trading on Friday following the release of its third-quarter 2025 financial results. The company's earnings fell short of analyst expectations, sparking concerns among investors.
The mortgage insurer reported quarterly earnings of $1.67 per share, missing the analyst consensus estimate of $1.78 by 6.29%. Although this represents a slight increase from $1.65 per share in the same period last year, it failed to meet market expectations. Additionally, Essent Group's quarterly sales came in at $311.830 million, falling short of the estimated $315.440 million and marking a 1.50% decrease from the previous year's $316.578 million.
Despite some positive aspects, such as insurance in force rising to $248.8 billion from $243.0 billion last year, investors seemed to focus on the earnings miss and the decline in net income. Essent's Q3 net income fell to $164.2 million from $176.2 million in 2024, further contributing to the negative sentiment. The company attributed its Q3 performance to favorable credit trends and the interest rate environment, which enhanced portfolio persistency and investment income. However, new insurance written decreased to $12.2 billion from $12.5 billion in both the previous quarter and Q3 2024, indicating potential challenges in new business growth.
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