With Warren Buffett's Berkshire Hathaway (BRK-A) getting into the municipal bond insurance business, maybe it's time to take a closer look at the bond and mortgage insurers. Is Buffett getting in because he thinks the industry has hit bottom, or does he think that now is a good time to take advantage of the competition? Time will tell. All of the following have market caps over $1 billion.
MBIA Inc. (MBI) provides financial guarantees for municipal bonds, asset-backed and mortgage-backed securities, and other types of bonds and pools of assets. The stock has a P/E of 4.5 , a PEG of 0.44 , and a yield of 6.10%.
Ambac Financial Group, Inc. (ABK) provides financial guarantee insurance and credit enhancement products. The stock has a P/E of 11.5, a PEG of 0.28, and a yield of 2.9%.
MGIC Investment Corp. (MTG) is a provider of private mortgage insurance for home mortgages. Although the company has been generating negative earnings, the stock pays a yield of 0.40%.
PMI Group Inc. (PMI) is a provider of residential mortgage insurance and structured finance products in the U.S. and in several countries around the world. The stock has a P/E of 6, a PEG of 2.84, and a yield of 1.50%.
Old Republic International Corp. (ORI) insures first mortgage loans on residential properties. It also provides general insurance and title insurance services. The stock has a P/E of 10 , a PEG of 1.52 , and a yield of 4.10%.
Author has no positions in any of the above.
By Fred Fuld at Stockerblog.com
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