Over the past six months, NMI Holdings’s shares (currently trading at $37.92) have posted a disappointing 8.8% loss, well below the S&P 500’s 7.8% gain. This might have investors contemplating their next move.

Given the weaker price action, is now the time to buy NMIH? Find out in our full research report, it’s free.

Why Does NMI Holdings Spark Debate?

Founded in the aftermath of the 2008 housing crisis to bring new capacity to the mortgage insurance market, NMI Holdings (NASDAQ: NMIH) provides mortgage insurance that protects lenders against losses when homebuyers default on their mortgage loans.

Two Positive Attributes:

2. Growing BVPS Reflects Strong Asset Base

For insurers, book value per share (BVPS) is a vital measure of financial health, representing the total assets available to shareholders after accounting for all liabilities, including policyholder reserves and claims obligations.

NMI Holdings’s BVPS increased by 16.5% annually over the last five years, and growth has recently accelerated as BVPS grew at an impressive 18.6% annual clip over the past two years (from $24.56 to $34.57 per share).

One Reason to Be Careful:

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.

NMI Holdings’s weak 10.2% annual EPS growth over the last two years aligns with its revenue trend. This tells us it maintained its per-share profitability as it expanded.

Final Judgment

NMI Holdings has huge potential even though it has some open questions. With the recent decline, the stock trades at 1× forward P/B (or $37.92 per share). Is now a good time to initiate a position? See for yourself in our full research report, it’s free.

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