Head to Head Contrast: MGIC Investment (NYSE:MTG) vs. TWFG (NASDAQ:TWFG)

MGIC Investment (NYSE:MTG) and TWFG (NASDAQ:TWFG) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their risk, dividends, earnings, profitability, valuation, analyst recommendations and institutional ownership.

Volatility and Risk

MGIC Investment has a beta of 0.92, suggesting that its share price is 8% less volatile than the S&P 500. Comparatively, TWFG has a beta of 0.25, suggesting that its share price is 75% less volatile than the S&P 500.

Insider and Institutional Ownership

95.6% of MGIC Investment shares are owned by institutional investors. 1.1% of MGIC Investment shares are owned by insiders. Comparatively, 66.5% of TWFG shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for MGIC Investment and TWFG, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MGIC Investment	2	3	0	1	2.00
TWFG	1	3	3	0	2.29

MGIC Investment currently has a consensus price target of $26.80, suggesting a potential downside of 4.91%. TWFG has a consensus price target of $32.50, suggesting a potential upside of 20.82%. Given TWFG’s stronger consensus rating and higher probable upside, analysts plainly believe TWFG is more favorable than MGIC Investment.

Earnings & Valuation

This table compares MGIC Investment and TWFG”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MGIC Investment	$1.22 billion	5.18	$762.99 million	$3.11	9.06
TWFG	$203.76 million	7.40	$2.74 million	$0.41	65.61

MGIC Investment has higher revenue and earnings than TWFG. MGIC Investment is trading at a lower price-to-earnings ratio than TWFG, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares MGIC Investment and TWFG’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MGIC Investment	61.96%	14.63%	11.53%
TWFG	2.87%	8.74%	7.27%

Summary

MGIC Investment beats TWFG on 9 of the 15 factors compared between the two stocks.

About MGIC Investment

MGIC Investment Corporation, through its subsidiaries, provides private mortgage insurance, other mortgage credit risk management solutions, and ancillary services to lenders and government sponsored entities in the United States, the District of Columbia, Puerto Rico, and Guam. The company offers primary mortgage insurance that provides mortgage default protection on individual loans, as well as covers unpaid loan principal, delinquent interest, and various expenses associated with the default and subsequent foreclosure. It also provides pool insurance for secondary market mortgage transactions; and contract underwriting services, as well as reinsurance. The company serves originators of residential mortgage loans, including savings institutions, commercial banks, mortgage brokers, credit unions, mortgage bankers, and other lenders. MGIC Investment Corporation was founded in 1957 and is headquartered in Milwaukee, Wisconsin.

About TWFG

TWFG, Inc. operates an independent distribution platform for personal and commercial insurance products in the United States. Its personal and commercial insurance products include auto, home, renters, life, health, motorcycle, umbrella, boat, recreational vehicle, flood, wind, event, luxury item, general liability, property, business auto, workers’ compensation, business owner policy, and professional liability insurance products, as well as commercial bonds and group benefits. The company was founded in 2001 and is based in The Woodlands, Texas. TWFG, Inc. operates as a subsidiary of Bunch Family Holdings, LLC.