Since December 2025, Essent Group has been in a holding pattern, posting a small loss of 1.9% while floating around $64.50. The stock also fell short of the S&P 500’s 6.8% gain during that period.
Is now the time to buy Essent Group, or should you be careful about including it in your portfolio? Dive into our full research report to see our analyst team’s opinion, it’s free.
Why Is Essent Group Not Exciting?
We don’t have much confidence in Essent Group. Here are three reasons you should be careful with ESNT, plus one stock we’d rather own.
1. Net Premiums Earned Point to Soft Demand
When insurers sell policies, they protect themselves from extremely large losses or an outsized accumulation of losses with reinsurance (insurance for insurance companies). Net premiums earned are therefore net of what’s ceded to reinsurers as a risk mitigation and transfer strategy.
Essent Group’s net premiums earned has grown at a 2.4% annualized rate over the last two years, much worse than the broader insurance industry and slower than its total revenue.
3. Recent EPS Growth Below Our Standards
While long-term earnings trends give us the big picture, we also track EPS over a shorter period because it can provide insight into an emerging theme or development for the business.
Essent Group’s EPS grew at a weak 3.1% compounded annual growth rate over the last two years, lower than its 5.4% annualized revenue growth. This tells us the company became less profitable on a per-share basis as it expanded.
Final Judgment
Essent Group’s business quality ultimately falls short of our standards. With its shares lagging the market recently, the stock trades at 0.9× forward P/B (or $64.50 per share). This valuation is reasonable, but the company’s shakier fundamentals present too much downside risk. We’re fairly confident there are better investments elsewhere. Let us point you toward the most entrenched endpoint security platform on the market.
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