In a recent filing with the Securities and Exchange Commission, Radian Group Inc . (NYSE:RDN), a company specializing in surety insurance, disclosed the departure of Brien J. McMahon, its Senior Executive Vice President and Chief Franchise Officer. McMahon's position will be eliminated, and his employment with Radian Group will be involuntarily terminated without cause, effective September 13, 2024.
The termination follows a Transition, Separation and Release Agreement between McMahon and Radian Group, which will take effect on July 21, 2024, unless revoked earlier. This agreement entitles McMahon to severance payments and benefits consistent with a "qualifying termination" under his Executive Severance Agreement, as detailed in the company’s Proxy Statement from April 5, 2024.
As part of the agreement, McMahon has agreed to a non-compete clause and will not solicit the company’s employees or customers for a year following his termination. To receive the severance and benefits, McMahon is required to execute and not revoke a second release of claims against Radian Group on or after his termination date.
The details of the Transition Agreement were summarized in the 8-K filing and the complete terms are included as an exhibit to the form. The summary in the SEC filing does not fully describe all the terms and conditions, and the full text of the agreement can be referenced in the exhibit filed with the SEC.
In other recent news, Radian Group Inc. reported a strong start to 2024, showcasing a 12% year-over-year increase in book value per share and a net income of $152 million. Revenues also saw a 3% rise, reaching $319 million. Another highlight was the company's successful launch of a $349 million residential mortgage-backed securities (RMBS) deal, marking Radian's first venture into the capital markets with a direct sale of unregistered RMBS to investors. The company's primary mortgage insurance in force also reached a record of $271 billion, with new insurance written in the quarter amounting to $11.5 billion.
Radian Group's robust credit performance was evident with a steady 2.1% default rate. The company's capital and liquidity positions remained solid, with available holding company liquidity increasing to approximately $1.1 billion. In terms of future expectations, Radian Group anticipates the private mortgage insurance market to reach approximately $300 billion in 2024, and plans to develop a mortgage-backed securitization program. These are some of the recent developments surrounding Radian Group Inc.
InvestingPro Insights
As Radian Group Inc. (NYSE:RDN) navigates through its executive team restructuring, investors may be interested in the current financial health and market position of the company. According to InvestingPro data, Radian Group has a market capitalization of $5.25 billion and boasts a robust P/E ratio of 9.12, which further adjusts to an attractive 8.49 when considering the last twelve months as of Q1 2024. This metric underscores the company's earnings relative to its share price, suggesting a potentially undervalued stock in a market where many peers have higher ratios.
Additionally, the company's revenue growth of 3.52% over the last twelve months signals a steady increase in its financial performance. Investors should also note the company's gross profit margin, an impressive 97.61%, highlighting its ability to retain a significant portion of revenue after accounting for the cost of goods sold.
Among the InvestingPro Tips, it is noteworthy that Radian Group has raised its dividend for 4 consecutive years and has maintained dividend payments for 32 consecutive years, demonstrating a commitment to shareholder returns. Moreover, the company's liquid assets exceed its short-term obligations, providing financial stability and flexibility. For those looking to delve deeper into Radian Group's potential, there are additional InvestingPro Tips available, including insights on stock performance and profitability forecasts for the year. Interested readers can access these tips and use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, unlocking further valuable investment analysis.
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