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Should I Buy NYSE:RDN Stock? (12% Forecasted Return) | RDN Radian Group Inc. Stock Forecast



We believe that when a company is viewed as being on the cusp between two liquidity descriptors and has higher-than-average cash plus inventory/unadjusted debt compared with similarly constituted peers, that helps support the better liquidity assessment. However, in the case of a nonresidential developer, given that its inventory is typically less liquid (and the greater potential for inventory to suffer value erosion in a downturn), we do not consider this measure as pertinent.For these reasons, although the criteria establish no rating threshold for liquidity, we typically expect: Instances of 'B+' and below rated issuers achieving liquidity descriptors higher than adequate to be rare and Few companies to qualify for the exceptional category, and these entities to typically have issuer credit ratings of 'BBB-' or above. We estimate RDN Radian Group Inc. stock forecast parameters by: Williams %R with ANOVA because of a weaker market position, higher risk, or more confidence-sensitive mix of business is only partially offset by any strengths, and this leads us to expect weaker revenue stability relative to peers, thus demonstrating modest incremental risk above what is captured in the anchor (12% Forecasted Return)

NYSE:RDN Stock Forecast (Buy or Sell) as of 23 Jun 2022 for (n+1 year)

Stock: RDN Radian Group Inc.

Time series to forecast n: 23 Jun 2022 for (n+1 year)

x axis:Likelihood %
y axis:Potential Impact %
z axis:Color (yellow to green) Technical Analysis %

Stock Forecast Criteria and Models for RDN Radian Group Inc.

  • ACE excludes the goodwill on acquired businesses to reflect a consistent treatment of the market value of an entity's business units, which does not depend on whether the entity acquires the businesses (in which case, goodwill is reported as an asset) or develops them internally (in which case, there is no goodwill).
  • We do not adjust reported capital if an M&A transaction generates negative goodwill, but we consider the implications of such a transaction when we assess an entity's business position and earnings capacity.
  • Minority interests:ACE includes the holdings of minority investors (so-called "non-controlling interests") associated with consolidated operating financial subsidiaries (which excludes insurance subsidiaries). The reason for this is we typically view the investment of minority investors in consolidated subsidiaries as a component of equity supporting group activities.
  • We lower RACF RWAs on corporate exposures by 50% of the notional of the credit default swaps (CDS) hedging these exposures. We also take into account a direct exposure to the credit-protection provider (usually a financial institution) for the totality of the notional. The 50% risk weight reflects our view that CDS underlying are, on average, in the low investment-grade category, and typically better rated than the average corporate exposure in banks' portfolios.
  • Credit conversion factors (CCFs) are multipliers to translate banks' off-balance-sheet exposures into adjusted exposures. The premise is that only a fraction of off-balance-sheet exposures will be realized because borrowers do not always fully draw on available credit facilities.
  • Industry characteristics typically encompass growth prospects, volatility, and technological change, as well as the degree and nature of competition. Broadly speaking, the lower the industry risk, the higher the potential credit rating for an obligor in that sector.
  • In determining our analytical adjustments, we consider how regulators generally treat capital, but our capital ratios are likely to be different from those of regulators. Regulators focus on issues at a national or regional level when defining their capital measures, whereas our goal is to produce capital measures that are globally comparable to enhance ratings comparability as much as possible.

Assumptions Underlying The Forecast Model for RDN Radian Group Inc.

Our view of a company's financial policy is an important input when assessing its current and future liquidity position. For instance, we assess whether a company has historically had a higher risk appetite and an aggressive acquisition strategy that has strained its liquidity position, or whether it has taken actions to preserve liquidity in past downturns.

Frequently Asked QuestionsQ: Is RDN Radian Group Inc. stock buy or sell?
A: We believe that when a company is viewed as being on the cusp between two liquidity descriptors and has higher-than-average cash plus inventory/unadjusted debt compared with similarly constituted peers, that helps support the better liquidity assessment. However, in the case of a nonresidential developer, given that its inventory is typically less liquid (and the greater potential for inventory to suffer value erosion in a downturn), we do not consider this measure as pertinent.
Q: Is RDN Radian Group Inc. stock expected to go up?
A: For these reasons, although the criteria establish no rating threshold for liquidity, we typically expect: Instances of 'B+' and below rated issuers achieving liquidity descriptors higher than adequate to be rare and Few companies to qualify for the exceptional category, and these entities to typically have issuer credit ratings of 'BBB-' or above.
Q: What is the forecast for RDN Radian Group Inc. ?
A: Our view of a company's financial policy is an important input when assessing its current and future liquidity position. For instance, we assess whether a company has historically had a higher risk appetite and an aggressive acquisition strategy that has strained its liquidity position, or whether it has taken actions to preserve liquidity in past downturns.
Q: What is the consensus rating of RDN Radian Group Inc. ?
A: The consensus rating for RDN Radian Group Inc. is 82.
Q: What are the risks of investing RDN Radian Group Inc. ?
A: We use risk analysis for RDN Radian Group Inc. because of a weaker market position, higher risk, or more confidence-sensitive mix of business is only partially offset by any strengths, and this leads us to expect weaker revenue stability relative to peers, thus demonstrating modest incremental risk above what is captured in the anchor


RDN Radian Group Inc.
AC Investment Research

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