DEF: Enact Holdings Reports Strong 2025 Performance, Outlines 2026 Proxy

Enact Holdings, Inc. announces robust 2025 financial results, including $674 million net income and $273 billion insurance in-force, ahead of its 2026 Annual Stockholders Meeting.

Summary

• Net income reached $674 million in 2025.
• New insurance written totaled $52 billion, contributing to a record insurance in-force of $273 billion at year-end 2025.
• The company maintained a strong capital and liquidity position, with PMIERs sufficiency at $1.9 billion, or 162% of requirements, at year-end.
• Over $500 million was returned to shareholders in 2025 through dividends and share repurchases, contributing to a total shareholder return of approximately 25%.
• Operating expenses were $218 million in 2025, a 2% decrease from 2024, exceeding expectations despite an inflationary environment.
• Enact helped over 134,000 borrowers purchase a home and over 16,000 borrowers retain their homes in 2025.
• A new $435 million revolving credit facility was established to enhance financial flexibility.
• Since its IPO, the company has returned over $1.6 billion to shareholders.
• Performance Stock Units (PSUs) granted in 2023 were earned at 200% of target, based on Book Value Per Share Growth over the three-year performance period ending December 31, 2025.
• Stockholders are invited to the virtual 2026 Annual Meeting on May 13, 2026, to vote on the election of eleven director nominees, an advisory vote on Named Executive Officer compensation, and the ratification of KPMG LLP as the independent registered public accounting firm for 2026.

Sentiment

Score: 8

Explanation: StockSavvy.ai views this as a very positive filing, highlighting strong financial performance, effective capital management, and strategic execution in a challenging macroeconomic environment. The high achievement of performance targets and significant shareholder returns underscore operational excellence.

Positives

• Achieved net income of $674 million in 2025, demonstrating strong profitability.
• Reported $52 billion in new insurance written and a record $273 billion in insurance in-force at year-end 2025.
• Maintained robust capital and liquidity with PMIERs sufficiency of $1.9 billion, or 162% of requirements.
• Returned over $500 million to shareholders in 2025 through dividends and share repurchases, and over $1.6 billion since the IPO.
• Delivered a strong total shareholder return of approximately 25% in 2025.
• Received multiple ratings upgrades throughout 2025, reflecting market recognition of performance and balance sheet strength.
• Operating expenses decreased by 2% to $218 million in 2025, outperforming expectations for expense discipline.
• Successfully deployed the latest version of its pricing engine, Rate360, enhancing risk selection and pricing capabilities.
• Expanded into attractive adjacencies, with Enact Re performing well and generating attractive risk-adjusted returns.
• Secured a new $435 million revolving credit facility, providing greater financial flexibility.
• The 2023 Performance Stock Units (PSUs) were earned at 200% of target, indicating exceptional long-term performance against Book Value Per Share Growth.
• Received overwhelming stockholder support (99% approval) on the 2025 say-on-pay vote.

Negatives

• The macroeconomic environment in 2025 remained dynamic and uncertain.
• Affordability continued to be an issue for many prospective first-time homebuyers.
• Certain 2025 performance targets for the annual incentive program were set below 2024 actual results, anticipating less favorable market conditions and tailwinds.

Risks

• Uncertainty and dynamism in the macroeconomic environment.
• Affordability challenges for prospective first-time homebuyers impacting market demand.
• Risks associated with financial accounting and reporting, including the system of internal control.
• Exposure to credit risks, market risks, insurance risks, housing risks, operational risks, and model risks.
• Information technology risks, climate risks, investment risks, artificial intelligence (AI) risks, cybersecurity, and information security risks.
• Potential impacts from litigation and investigations/regulatory matters.
• Genworth's significant control rights under the Master Agreement, requiring consent for actions such as changing board size, capital actions, significant acquisitions/dispositions, and dismissal of the independent accounting firm.
• Potential for recalculation of tax payments to Genworth if taxable income, special deductions, or credits change within the Genworth Consolidated Group.
• Non-competition and non-solicitation covenants with Genworth restricting business activities and employee recruitment.

Future Outlook

Management remains confident in the company's ability to execute and capitalize on future opportunities. With a strong balance sheet, a disciplined strategy, and a talented team, Enact Holdings is well positioned to continue supporting its customers, growing its business, and delivering sustainable value for shareholders in 2026 and beyond.

Management Comments

• "We had another excellent year in 2025, with net income of $674 million, new insurance written of $52 billion and record insurance in-force of $273 billion."
• "We operated from a position of strong capital and liquidity, with PMIERs sufficiency of $1.9 billion, or 162% of requirements, at year end."
• "In 2025, we returned over $500 million to shareholders through dividends and share repurchases."
• "Our performance, execution against our strategic priorities and the strength of our balance sheet was recognized by the market, as reflected in multiple ratings upgrades throughout the year and our strong total shareholder return of approximately 25%."
• "The U.S. economy continued to be supported by steady consumer spending, moderating inflation and a resilient labor market."
• "While affordability remained an issue for many, our business remained underpinned by strong demographic tailwinds, particularly from prospective first-time homebuyers entering the market."
• "Overall, the long-term drivers of housing demand remain strong, and we are confident that mortgage insurance will continue to play an essential role for first-time homebuyers."
• "We remained committed to expense discipline and ended the year with operating expenses of $218 million, down 2% from 2024 and ahead of our expectations despite an inflationary environment."
• "Since our IPO, we have returned over $1.6 billion to shareholders through dividends and share repurchases, and we remain committed to capital returns as we move forward."
• "As we look to 2026 and beyond, we remain confident in our ability to execute and capitalize on the opportunities ahead."

Industry Context

StockSavvy.ai notes that Enact Holdings operates within a dynamic U.S. housing market, benefiting from steady consumer spending, moderating inflation, and a resilient labor market. The company's focus on first-time homebuyers and innovation in risk selection and pricing, such as Rate360, positions it to navigate ongoing affordability challenges and capitalize on strong long-term housing demand drivers. The continued expansion into adjacencies like Enact Re also reflects a broader industry trend of diversification within financial services.

Comparison to Industry Standards

• Enact's 2025 total shareholder return of approximately 25% compares favorably to the market cap weighted peer group (Essent Group Ltd., MGIC Investment Corporation, NMI Holdings, Inc., and Radian Group Inc.) cumulative TSR of $186.20 (from $100 invested on Sept 16, 2021) for 2025, indicating strong relative performance.
• The company's PMIERs sufficiency of 162% of requirements at year-end 2025 demonstrates a robust capital position, which is a critical benchmark for mortgage insurers, often exceeding regulatory minimums and competitive averages.
• Operating expenses decreased by 2% from 2024 to $218 million, indicating strong expense discipline in an inflationary environment, which is a positive signal compared to industry peers facing similar cost pressures.

Management Changes

Corporate Governance

Legal Proceedings

• No specific ongoing legal proceedings are detailed, but the Risk Committee oversees risks associated with litigation and investigations/regulatory matters involving the Corporation.

Related Party Transactions

• Master Agreement with Genworth: Governs aspects of the continuing relationship, including Genworth's board nomination rights, approval rights for certain corporate actions, non-competition and non-solicitation covenants, information sharing, and tax matters.
• Registration Rights Agreement with Genworth: Allows Genworth to require Enact to file registration statements for the public resale of Genworth's beneficially owned registrable securities.
• Shared Services Agreement with Genworth: Genworth provides information technology and administrative services to Enact, with service charges of $7.5 million in 2024, $6.25 million in 2025, and $5 million in 2026.
• Intellectual Property Cross License Agreement with Genworth: Provides mutual non-exclusive, irrevocable, royalty-free, perpetual licenses for specified intellectual property (excluding trademarks).
• Transitional Trademark License Agreement with Genworth and EMH: Grants Enact a limited non-exclusive, non-transferable, royalty-free license to use certain specified trademarks for a transition period.
• Investment Management Agreements with Genworth: Enact subsidiaries pay investment management fees to Genworth, totaling $0.6 million as of March 16, 2026, $7.8 million for 2025, and $7.1 million for 2024.
• Tax Allocation Agreement with Genworth: Allocates consolidated tax liability within the Genworth Consolidated Group among its members, including Enact.
• Employee Benefit Plans: Enact employees participate in certain retirement programs (e.g., 401(k) Savings Feature, Retirement Account Feature, SERP, Restoration Plan) and life insurance programs (Leadership Life, Executive Life) administered by Genworth.

Stakeholder Impact

• Shareholders: Benefited from a strong total shareholder return of approximately 25% in 2025 and significant capital returns (over $500 million in 2025, over $1.6 billion since IPO). Corporate governance practices aim to protect long-term interests.
• Policyholders/Customers: The company helped over 134,000 borrowers buy a home and over 16,000 borrowers keep their home in 2025, demonstrating continued support for an important societal need.
• Employees: Compensation programs are designed to attract, retain, and motivate executives and employees, with performance-based incentives and participation in various benefit plans.
• Creditors: A strong capital and liquidity position, evidenced by PMIERs sufficiency of 162%, and a new $435 million revolving credit facility enhance financial stability and creditworthiness.
• Regulatory Authorities: The company's adherence to SEC and Nasdaq rules, along with the Risk Committee's oversight of regulatory compliance, indicates a commitment to meeting regulatory expectations.

Next Steps

• Stockholders will vote on the election of eleven director nominees at the 2026 Annual Meeting.
• Stockholders will conduct an advisory vote to approve Named Executive Officer compensation.
• Stockholders will vote on the ratification of KPMG LLP as the independent registered public accounting firm for 2026.
• The company plans to continue supporting existing policyholders and investing in its business.
• Management is committed to continuing to return excess capital to stockholders.
• The company will continue to execute its disciplined strategy, capitalize on opportunities, grow the business, and deliver sustainable value for shareholders.
• The Board and its committees will develop action plans for improvements based on their annual self-evaluations.

Key Dates

Recommendation

Enact Holdings demonstrates strong financial performance in 2025, exceeding key metrics and returning significant capital to shareholders. The positive outlook and disciplined strategy are encouraging. However, as this is a proxy statement primarily detailing past performance and governance for an upcoming annual meeting, and not a new earnings report, a 'hold' recommendation is prudent for investors to assess future growth catalysts and the impact of the dynamic macroeconomic environment on the mortgage insurance sector.

Keywords

Mortgage Insurance, Financial Performance, SEC Filing, Proxy Statement, Corporate Governance, Shareholder Return, Capital Allocation, Risk Management, Executive Compensation, Enact Holdings