8-K: Enact Holdings Reports Q1 2026 Financial Results

Enact Holdings, Inc. announced its first quarter 2026 financial results, reporting GAAP Net Income of $168 million and Adjusted Operating Income of $172 million.

Summary

• Enact Holdings, Inc. reported first quarter 2026 results with GAAP Net Income of $168 million, or $1.18 per diluted share, and Adjusted Operating Income of $172 million, or $1.21 per diluted share.
• Primary insurance in-force (IIF) stood at $272 billion, a 2% increase year-over-year.
• New insurance written (NIW) was $13 billion, up 30% compared to the first quarter of 2025.
• The company maintained a strong PMIERs Sufficiency of 162%, representing approximately $1.9 billion above requirements.
• Book Value Per Share was $38.09.
• The company repurchased approximately $93 million of its shares during the quarter.
• The Board of Directors declared a 14% increase in the quarterly dividend to $0.24 per common share.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a positive report, with strong year-over-year growth in new business and a robust capital position, despite a slight sequential dip in profitability and an increase in loss ratios from an exceptionally low prior quarter.

Positives

• Strong start to 2026 with disciplined execution and resilient credit performance.
• Net income of $168 million and adjusted operating income of $172 million demonstrate solid profitability.
• New insurance written (NIW) increased by 30% year-over-year to $13 billion, indicating growth.
• Primary insurance in-force (IIF) grew 2% year-over-year to $272 billion, showing stable market presence.
• PMIERs Sufficiency remains strong at 162% ($1.9 billion above requirements), indicating robust capital position.
• Book Value Per Share increased to $38.09.
• Significant share repurchases ($93 million) and a 14% increase in quarterly dividend to $0.24 per share signal confidence and commitment to shareholder returns.
• S&P upgraded the financial strength rating outlook for EMICO, EHI, and Enact Re to positive.

Negatives

• Net income per diluted share decreased slightly to $1.18 from $1.22 in Q4 2025 and $1.08 in Q1 2025.
• Adjusted operating income per diluted share decreased slightly to $1.21 from $1.23 in Q4 2025.
• Losses incurred increased to $37 million (15% loss ratio) compared to $18 million (7% loss ratio) in Q4 2025.
• Net investment gains (losses) were negative at $(6) million, compared to $(3) million in the prior quarter and prior year.
• Persistency rate decreased to 80% from 84% in Q1 2025.

Risks

• Affordability and mortgage rate volatility continue to shape housing activity.
• Potential for economic downturn or recession in the United States and globally.
• Changes in regulatory environment or business practices of Fannie Mae and Freddie Mac.
• Failure to continue meeting mortgage insurer eligibility requirements of the GSEs.
• Increased competition for customers.
• Lenders or investors seeking alternatives to private mortgage insurance.
• Increase in loans insured through Federal government mortgage insurance programs.

Future Outlook

The company's strong balance sheet, differentiated capabilities, and commitment to innovation position it to succeed in the dynamic market environment and help people responsibly achieve homeownership.

Management Comments

• Enact delivered a strong start to 2026, reflecting disciplined execution, resilient credit performance, and our continued focus on long-term value creation.
• Affordability and mortgage rate volatility continued to shape housing activity, and against this backdrop we continued to demonstrate the resiliency of our model, prudently growing new insurance written while maintaining our focus on expense and risk management.
• As we look ahead, our strong balance sheet, differentiated capabilities and ongoing commitment to innovation position us to succeed in this dynamic market environment as we help people responsibly achieve homeownership.

Industry Context

StockSavvy.ai notes that Enact's Q1 2026 results reflect the ongoing challenges and opportunities within the U.S. mortgage insurance market, characterized by fluctuating interest rates and evolving housing affordability dynamics. The company's performance, particularly its growth in new insurance written and strong capital position, aligns with broader industry trends of resilience and adaptation.

Comparison to Industry Standards

• Enact's Loss Ratio of 15% for Q1 2026 is higher than the 7% reported in Q4 2025 but comparable to the 12% reported in Q1 2025, indicating a return to more normalized loss levels after a strong prior quarter.
• The Expense Ratio of 20% is an improvement from 24% in Q4 2025 and slightly better than 21% in Q1 2025, suggesting effective cost management.
• The Return on Equity of 12.5% and Adjusted Operating Return on Equity of 12.9% are solid but slightly down from the prior quarter's 13.3% and 13.5% respectively, and also slightly lower than Q1 2025's 13.1% and 13.4%, suggesting a slight moderation in profitability compared to recent periods.
• PMIERs Sufficiency of 162% is a strong indicator of capital adequacy, generally considered well above industry benchmarks for well-capitalized mortgage insurers.

Stakeholder Impact

• Shareholders: Benefit from a 14% increase in quarterly dividend and ongoing share repurchases, signaling confidence in future performance.
• Lenders: Continue to receive reliable mortgage insurance services, supported by Enact's financial strength and underwriting expertise.
• Borrowers: Benefit from Enact's mission to help more people achieve homeownership.

Next Steps

• Continue to help people responsibly achieve homeownership.
• Succeed in the dynamic market environment.
• Focus on innovation.

Key Dates

Recommendation

The Q1 2026 results show solid year-over-year growth and a strong capital position, with positive management commentary and shareholder return initiatives. However, the slight sequential decline in profitability and increase in loss ratios from an exceptionally low prior quarter warrant a 'hold' rating pending further performance trends and market conditions. The positive S&P outlook is a strong positive.

Keywords

mortgage insurance, Enact Holdings, financial results, Q1 2026, PMIERs, shareholder returns, earnings, housing market