Shares of US mortgage insurer Enact Holdings achieved a significant milestone this week, breaking through the $38 barrier for the first time to establish a fresh all-time high. This surge comes as the company distributed its quarterly dividend of $0.21 per share to shareholders, creating a dual celebration for investors. The stock’s impressive run, which has seen it appreciate more than 20% since the start of the year, prompts the question of whether this upward trajectory can be sustained.
Strong Fundamentals Support the Rally
The company’s robust performance is rooted in solid second-quarter results. Enact reported $13 billion in new insurance written, representing a substantial 35% increase over the previous quarter. This growth was largely driven by seasonal trends within the US housing market, which the company effectively capitalized on.
Financially, Enact demonstrated considerable strength with an adjusted operating income of $174 million. Earnings per share came in at $1.15 for Q2, showcasing the operation’s profitability. Despite the record-breaking share performance, the stock maintains an attractive valuation with a price-to-earnings ratio below 9.
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Management has reinforced its commitment to shareholder returns, upgrading its capital return guidance to approximately $400 million through 2025. This enhanced outlook signals confidence in the company’s financial strategy and operational execution.
Technical Momentum and Market Outlook
From a technical perspective, Enact’s shares have broken through significant resistance levels, trading just shy of $38.64 during Monday’s session. Market analysts maintain a cautiously optimistic stance, with average price targets sitting at $39.60, suggesting moderate additional upside potential.
The next critical test for Enact arrives on November 3rd, when the company is scheduled to release its third-quarter earnings. Until then, investors can enjoy the combination of record share performance and dividend distributions, reflecting a period of exceptional strength for the mortgage insurer.
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