Contrasting Essent Group (NYSE:ESNT) & The PMI Group (OTCMKTS:PPMIQ)

Essent Group (NYSE:ESNT) and The PMI Group (OTCMKTS:PPMIQ) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, analyst recommendations, valuation and institutional ownership.

Profitability

This table compares Essent Group and The PMI Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Essent Group	60.15%	13.81%	10.99%
The PMI Group	N/A	N/A	N/A

Institutional and Insider Ownership

93.0% of Essent Group shares are owned by institutional investors. 3.2% of Essent Group shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent recommendations for Essent Group and The PMI Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Essent Group	0	3	4	0	2.57
The PMI Group	0	0	0	0	0.00

Essent Group currently has a consensus price target of $64.71, indicating a potential upside of 18.87%. Given Essent Group’s stronger consensus rating and higher possible upside, research analysts plainly believe Essent Group is more favorable than The PMI Group.

Valuation & Earnings

This table compares Essent Group and The PMI Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Essent Group	$1.23 billion	4.72	$696.39 million	$6.90	7.89
The PMI Group	N/A	N/A	N/A	N/A	N/A

Essent Group has higher revenue and earnings than The PMI Group.

Summary

Essent Group beats The PMI Group on 9 of the 9 factors compared between the two stocks.

About Essent Group

Essent Group Ltd., through its subsidiaries, provides private mortgage insurance and reinsurance for mortgages secured by residential properties located in the United States. Its mortgage insurance products include primary, pool, and master policy. The company also provides information technology maintenance and development services; customer support-related services; underwriting consulting; and contract underwriting services, as well as risk management products and title insurance and settlement services. It serves the originators of residential mortgage loans, such as regulated depository institutions, mortgage banks, credit unions, and other lenders. Essent Group Ltd. was incorporated in 2008 and is based in Hamilton, Bermuda.

About The PMI Group

The PMI Group, Inc. (TPG) through its subsidiary PMI Mortgage Insurance Co. (MIC), and its affiliated companies (collectively PMI), provides residential mortgage insurance in the United States. During the year ended December 31, 2009, the Company operated in three business segments: United States Mortgage Insurance Operations, International Operations and Corporate and Other. As a United States residential mortgage insurer, PMI offers a variety of mortgage insurance products to meet the capital and credit risk mitigation needs of its customers. In November 2011, the Company announced that it has filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware.