With the news that U.S. single-family home sales surged to an eight-month high in March, we are anticipating further improvements as rates continue to rise. The strength in March home sales points to underlying strength in the economy, just as earnings season lifts investors hopes over the past two weeks.
The Commerce Department said new home sales jumped 5.8 percent to a seasonally adjusted annual rate of 621,00 units for the month of March, the highest level since July 2016. New home sales were up 15.6 percent on a year-over-year basis.
With that in mind, mortgage finance companies are looking more profitable.
FNMA for example, while inexpensive, reflects the bullish sentiment in this industry group. Volume is starting to build. This is not a recommendation to buy FNMA, its merely a reference point.
Radian is in this group as well, in addition to being on the IBD50 List for several weeks. The candidate was a day trade last week as price action Tuesday, suggested a follow though on Wednesday. Nimble traders caught the morning pop. The stock since pulled back to the rising 9/20ema and is showing signs of a prompt recovery.
RDN oscillators are all pointing to higher prices.
Radian said it had net income of 34 cents per share. Earnings, adjusted for non-recurring costs, came to 37 cents per share.
The results fell short of Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of 43 cents per share.
The mortgage insurer posted revenue of $288.8 million in the period. Its adjusted revenue was $253.6 million.
Radian shares have climbed almost 8 percent since the beginning of the year. The stock has risen 54 percent in the last 12 months. – Source AP
We will be watching RDN post-EPS, FNMA and the entire mortgage and home building industry group closely; Spring is here after all..