Summary of ACT Q1 2026 Earnings Call

1Key Financial Results and Metrics

Adjusted Operating Income: $172 million, or $1.21 per diluted share, up from $1.10 year-over-year but down from $1.23 in Q4 2025.

Adjusted Return on Equity: 13%.

New Insurance Written: $13 billion, down 11% sequentially but up 30% year-over-year.

Total Insurance in Force: $272 billion, down $1 billion from Q4 2025 but up $4 billion year-over-year.

Persistency Rate: 80%, flat sequentially but down 4 points year-over-year.

Total Delinquencies: Decreased to 24,700, with a delinquency rate of 2.6%.

Loss Ratio: 15%, with losses of $37 million.

Operating Expenses: $49 million, with an expense ratio of 20%.

PMIERs Sufficiency Ratio: 162%, indicating strong capital position.

2Strategic Updates and Business Highlights

Enact is focused on long-term value creation despite a volatile mortgage rate environment.

The company successfully managed expenses and is on track to meet its 2026 expense guidance of $215 million to $220 million.

A 14% increase in quarterly dividends was announced, raising it from $0.21 to $0.24 per share, marking the fourth consecutive year of dividend increases.

The company is actively engaged in the rollout of VantageScore 4.0, supporting credit modernization efforts to expand access to homeownership.

3Forward Guidance and Outlook

Enact expects to return approximately $500 million in capital to shareholders in 2026.

The company remains optimistic about the housing market's long-term fundamentals and its ability to navigate a dynamic operating environment.

Credit performance is anticipated to remain strong, although there may be upward pressure on delinquency rates due to portfolio seasoning.

4Bad News, Challenges, or Points of Concern

Mortgage rate volatility continues to impact mortgage activity, particularly affecting refinance applications as rates increased in March and April.

The persistency rate has declined year-over-year, which could indicate potential challenges in maintaining insurance in force.

There are concerns about geographic disparities in housing prices, particularly in markets like Florida and Texas, where home prices have moderated.

The potential for increased delinquency rates is acknowledged, particularly from newer loan vintages with higher risk attributes.

5Notable Q&A Insights

Management indicated that while overall credit performance is strong, they are monitoring specific geographic markets for home price fluctuations and potential impacts on pricing and exposures.

The company has not seen significant deviations from pricing expectations despite regional variations in home prices.

There is an expectation that delinquency rates could tick up from current levels due to aging portfolios and macroeconomic factors.

Insights shared regarding refinancing behavior indicated that lower-risk borrowers are more likely to refinance, which could lead to an increase in mortgage insurance penetration during favorable rate environments. Overall, Enact's Q1 2026 results reflect a solid performance amid a challenging environment, with strategic initiatives aimed at long-term growth and stability. However, potential headwinds from market volatility and credit trends warrant close monitoring.