Radian’s own disclosures do not establish that its stock is 70% undervalued. The company’s quarter ended June 30, 2026 is worth reading closely, and the Inigo acquisition has widened the business beyond mortgage insurance. But a valuation claim like this stands or falls on a share price, a date, a valuation method and an earnings base, and the headline supplies none of them. This article sets out the reported figures, the arithmetic a 70% gap implies, and how to test the claim against the company’s filings.
What a 70% gap would have to mean
“Undervalued by 70%” can be read two ways, and the two readings imply very different fair values. In the table, P is the share price and V is the estimated fair value per share.
| How the claim is read | Formula | Fair value implied |
|---|---|---|
| The share price is 30% of fair value (70% below fair value) | V = P ÷ 0.30 | About 3.3 times the share price |
| The stock has 70% upside from its price | V = P × 1.70 | 1.7 times the share price |
The first reading is the stricter one and implies the much larger gap. Radian’s Q2 2026 earnings release and its Form 10-Q do not present a 70% fair-value estimate, and we could not identify who produced the figure or on what share price, date, method or forecast period it rests. Treat it as an unverified claim until its author shows the calculation. A version of the claim that can be checked would state:
- The share price and the date it was taken.
- The valuation method: price-to-book, an earnings multiple, or a discounted cash-flow model.
- The forecast period and key assumptions, including the cost of equity or discount rate where one is used.
- The earnings base: reported GAAP results, company-adjusted operating results, or an independently normalized estimate.
- How the Inigo acquisition and the divestitures are treated.
What Radian reported for Q2 2026
Radian released results for the quarter ended June 30, 2026 on August 5, 2026. It is the latest quarter covered in this article. The table separates GAAP figures from the company’s adjusted operating measures, which are non-GAAP and defined by Radian in its release.
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| Measure | Figure | Basis | Period |
|---|---|---|---|
| Total revenue | $575 million | Reported | Quarter ended June 30, 2026 |
| Net income from continuing operations | $118 million | GAAP | Same quarter |
| Diluted net income from continuing operations per share | $0.87 | GAAP | Same quarter |
| Adjusted diluted net operating income per share | $1.14 | Non-GAAP, company-defined | Same quarter |
| Adjusted pretax operating income | $196 million | Non-GAAP, company-defined | Same quarter |
| Adjusted net operating return on equity | 12.9% | Non-GAAP, company-defined | Same quarter |
| Primary mortgage insurance in force | $284 billion | Operating metric | As of June 30, 2026 |
| Purchase-accounting adjustments, acquired-intangible amortization and acquisition-related expenses | $39 million | Inigo-related accounting items | Same quarter |
Two points matter for any valuation. First, adjusted diluted operating earnings of $1.14 per share sit $0.27 above GAAP diluted earnings from continuing operations of $0.87. Check the release’s reconciliation to see how much of that gap comes from the $39 million of Inigo-related items and how much from other adjustments. Second, the 12.9% is an adjusted return on equity. Do not use it as a GAAP return without recalculating from GAAP earnings and equity.
What changed: Inigo and the divestitures
Inigo and the two-segment structure
Radian completed its acquisition of Inigo Limited on February 2, 2026. The company now reports two segments, Mortgage and Specialty, and describes itself as a global multi-line specialty insurer. That is a broader business than a mortgage insurer alone.
The deal also brings purchase-accounting adjustments, amortization of acquired intangible assets and acquisition-related expenses into the reported numbers. Those items are why the $39 million figure in the table matters for any comparison with earlier periods.
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Real Estate Services and Title
According to the Form 10-Q for the quarter ended June 30, 2026, Radian completed the sale of its Real Estate Services business and agreed to sell its Title business, with completion expected by year-end 2026. That status is as of the filing date. Check the company’s later filings to see whether the Title sale has closed. The proceeds and their intended use are not quantified in the disclosures this article relies on, so the sales cannot yet be credited with a specific amount of value.
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Radian’s 2025 Form 10-K reports net income from continuing operations of $618 million for 2025 and primary mortgage insurance in force of $282.5 billion at December 31, 2025. Set beside the 2026 figures, they compare as follows.
| Measure | 2025 baseline | 2026 figure | Comparable? |
|---|---|---|---|
| Net income from continuing operations | $618 million, full year 2025 (Form 10-K) | $118 million, quarter ended June 30, 2026 | No. One quarter against a full year, and the 2026 period includes Inigo. |
| Primary mortgage insurance in force | $282.5 billion at December 31, 2025 | $284 billion at June 30, 2026 | Yes, for the same measure. Up about $1.5 billion (roughly 0.5%) in six months. |
The 2026 quarter includes a full quarter of Inigo, which the 2025 year does not contain, and the segment mix has changed. Annualizing the quarter ($118 million × 4 ≈ $472 million) gives a figure below 2025’s $618 million. That is arithmetic, not an earnings trend: one quarter can differ materially from a full year, and the two periods are not built the same way.
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The same caution applies to headline growth rates. If a headline shows revenue up 93% year over year, that figure cannot be read as organic growth until the acquired business is separated from the rest. We could not verify that figure against Radian’s filings.
Mortgage insurance: the earnings engine and its exposures
The Mortgage segment remains a major source of Radian’s earnings and capital generation. Primary insurance in force of $284 billion at June 30, 2026 is described as a company record. The figure measures the risk the company has insured, though, not the profit it earns on that risk. Profit moves with four things, all of which depend on housing and credit conditions:
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- Claims: how many insured loans default and how large the losses are on those defaults.
- Persistency: how long borrowers keep their insured loans in force, which determines how long premiums are earned.
- Pricing: the premium rates the company can charge on new business.
- Housing and credit conditions: home prices, employment and interest rates, which drive both defaults and the volume of new loans.
Mortgage is also the part of the company with the longest reporting history, so its trends are easier to test than Specialty’s.
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Specialty: where the acquisition risk sits
The Specialty segment is new to Radian’s reporting. Inigo brings different underwriting cycles, lines of business, geographies and acquisition accounting from mortgage insurance. Its results depend on underwriting profitability, claims experience and how well Inigo’s operations are integrated, rather than on the housing market. That makes Specialty a separate valuation question. It should not be assumed to lift per-share earnings simply because it now sits in the portfolio.
Ask for segment-level results. The segment disclosures in the Form 10-Q show each segment’s contribution, and a valuation built only on combined totals hides whether Specialty earns its cost of capital.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Valuation math: what the numbers would need to support
Earnings multiple cross-check
A rough diluted share count comes from dividing net income from continuing operations by diluted earnings per share from continuing operations: $118 million ÷ $0.87 gives roughly 135 million shares, give or take a few million from rounding. Take the exact diluted weighted-average share count from the 10-Q income statement.
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Multiplying the quarter by four gives annualized earnings of $3.48 per share on a GAAP basis and $4.56 on an adjusted basis. These are simple run-rates, not forecasts, and one quarter may not repeat.
The earnings multiple is the share price divided by earnings per share. A 70% discount to fair value means the fair value is 3.3 times the price, so on the same earnings base the fair-value multiple must be 3.3 times the multiple the stock trades at today. A hypothetical stock priced at 10 times annualized GAAP earnings would need a fair-value multiple of about 33 times on that same base. The claim would need an explicit reason for that multiple, and the headline does not supply one.
Book value cross-check
Radian’s adjusted net operating return on equity of 12.9% can feed a price-to-book model. A common steady-state formula is P/B = (ROE − g) ÷ (cost of equity − g), where g is long-run growth. The table uses hypothetical inputs to show the mechanics. They are not estimates for Radian.
| Return on equity (hypothetical) | Cost of equity (hypothetical) | Growth (hypothetical) | Justified price-to-book | Price-to-book at which the stock is 70% below that value |
|---|---|---|---|---|
| 12.9% | 9% | 3% | 1.65 | 0.50 |
| 12.9% | 10% | 3% | 1.41 | 0.42 |
| 12.9% | 11% | 3% | 1.24 | 0.37 |
| 10.0% | 9% | 3% | 1.17 | 0.35 |
| 10.0% | 10% | 3% | 1.00 | 0.30 |
| 10.0% | 11% | 3% | 0.88 | 0.26 |
Two cautions apply. The 12.9% is an adjusted measure, not GAAP return on equity. And turning these ratios into per-share values requires shareholders’ equity and shares outstanding from the 10-Q balance sheet, which this article does not supply.
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Capital, distributions and divestiture cash
Radian has described capital management and stockholder returns as strategic priorities. Whether that supports a valuation thesis depends on five things:
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- Operating cash generation from both segments, not just reported net income.
- Dividends the insurance subsidiaries can pay to the holding company, which insurance regulation limits.
- Capital the mortgage business must hold under the Private Mortgage Insurer Eligibility Requirements (PMIERs) that Fannie Mae and Freddie Mac apply to mortgage insurers. Those requirements set how much capital is held before any surplus can be returned.
- Any share repurchases, and whether they are funded from earnings or from divestiture proceeds.
- The Title sale’s proceeds, timing and stranded costs, meaning overhead that stays behind after the business is sold.
How to test the 70% claim yourself
- Identify the source and date of the 70% estimate. Without its share price, method and forecast period, the claim cannot be checked.
- Write down the current share price and its date. Divide it by $3.48 for a GAAP run-rate multiple and by $4.56 for an adjusted one.
- In the Form 10-Q for the quarter ended June 30, 2026, take shareholders’ equity and shares outstanding from the balance sheet. Divide equity by shares for book value per share, then divide the price by that figure for price-to-book. Check the most recent filing for later figures.
- Pick one earnings base and one method, and use the same base in the claim and in your own check.
- Compute the fair value the claim implies under the reading its author intended, and compare it with the multiple or price-to-book your own assumptions support.
- Read management’s strategy and capital targets in Radian’s Investor Day presentation and transcript on its investor relations site, and quote only from the official transcript.
- Check later filings for the next quarter’s results, the status of the Title sale and any change to the segment structure.
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