Friedman, Billings, Ramsey & Co., Arlington, Va., has established research coverage for the four publicly traded stand-alone mortgage insurance companies.Paul Miller, an analyst for FBR, said mortgage insurance companies offer "plenty of upside over the next 12 to 18 months. While earnings-per-share growth rates will slow down from the 17%-plus EPS growth rates experienced over the last five years, returns on equity should remain strong and the relative valuations remain very inexpensive at current levels, with the group currently trading at eight times fiscal year 2003 estimates." FBR rates MGIC Investment Corp. and Triad Guaranty Inc. as "market perform," and PMI Group Inc. and Radian Group Inc. as "outperform."
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