Mortgage insurance provider Essent Group (NYSE:ESNT) met Wall Street’s revenue expectations in Q4 CY2025, but sales were flat year on year at $312.4 million. Its GAAP profit of $1.60 per share was 8% below analysts’ consensus estimates.
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Essent Group (ESNT) Q4 CY2025 Highlights:
- Net Premiums Earned: $212.7 million (13% year-on-year decline)
- Revenue: $312.4 million vs analyst estimates of $311.6 million (flat year on year, in line)
- Pre-tax Profit: $184.5 million (59.1% margin)
- EPS (GAAP): $1.60 vs analyst expectations of $1.74 (8% miss)
- Book Value per Share: $60.31 (13% year-on-year growth)
- Market Capitalization: $6.35 billion
“We are pleased to report strong operating performance in the fourth quarter and full year 2025, which underscores the resilience of our business model and our ability to generate sustainable, long-term value for our shareholders,” said Mark A. Casale, Chairman and Chief Executive Officer.
Company Overview
Serving as a crucial bridge between homebuyers and the American dream of homeownership, Essent Group (NYSE:ESNT) provides private mortgage insurance and title services that enable lenders to offer home loans with down payments of less than 20%.
Revenue Growth
Big picture, insurers generate revenue from three key sources. The first is the core business of underwriting policies. The second source is income from investing the “float” (premiums collected upfront not yet paid out as claims) in assets such as fixed-income assets and equities. The third is fees from various sources such as policy administration, annuities, or other value-added services. Unfortunately, Essent Group’s 5.7% annualized revenue growth over the last five years was tepid. This was below our standard for the insurance sector and is a tough starting point for our analysis.
Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. Essent Group’s annualized revenue growth of 6.6% over the last two years aligns with its five-year trend, suggesting its demand was consistently weak. 
Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.
This quarter, Essent Group’s $312.4 million of revenue was flat year on year and in line with Wall Street’s estimates.
Net premiums earned made up 81.1% of the company’s total revenue during the last five years, meaning Essent Group barely relies on non-insurance activities to drive its overall growth.
Markets consistently prioritize net premiums earned growth over investment and fee income, recognizing its superior quality as a core indicator of the company’s underwriting success and market penetration.
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Book Value Per Share (BVPS)
Insurance companies are balance sheet businesses, collecting premiums upfront and paying out claims over time. The float–premiums collected but not yet paid out–are invested, creating an asset base supported by a liability structure. Book value per share (BVPS) captures this dynamic by measuring these assets (investment portfolio, cash, reinsurance recoverables) less liabilities (claim reserves, debt, future policy benefits). BVPS is essentially the residual value for shareholders.
We therefore consider BVPS very important to track for insurers and a metric that sheds light on business quality because it reflects long-term capital growth and is harder to manipulate than more commonly-used metrics like EPS.
Essent Group’s BVPS grew at an impressive 11.9% annual clip over the last five years. The last two years show a similar trajectory as BVPS grew by 12.2% annually from $47.87 to $60.31 per share.
Key Takeaways from Essent Group’s Q4 Results
We struggled to find many positives in these results. Overall, this quarter could have been better. The stock remained flat at $65.64 immediately after reporting.
So should you invest in Essent Group right now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).