Radian Group Inc. (RDN) — Fair Value Analysis
Base-case fair value (P50): $55.14 · Current price: $37.26 · Verdict: Undervalued
The Verdict on RDN
Monte Carlo simulations suggest that RADIAN GROUP INC (RDN) is Deeply Undervalued at its current market price of $37.26. Our analysis indicates a median fair value (P50) of $55.14, representing a substantial potential upside of +48.0% from current levels. This robust fair value estimate, derived from thousands of forward-looking scenarios, paints a compelling picture for investors considering RDN. The significant gap between the present market valuation and our calculated intrinsic value underscores a potentially overlooked opportunity for long-term capital appreciation.
How RDN stacks up against peers
While RDN's operational and financial health remains "unrated" against its sector peers, the strong valuation signal from our Monte Carlo models suggests that the stock’s current price of $37.26 does not reflect its fundamental potential. Despite the absence of a quality tier rating, the deep undervaluation, with a P50 fair value of $55.14 and an +48.0% upside, implies that market participants may be underpricing future cash flow generation or risk factors relative to our comprehensive simulations. This unrated status does not detract from the quantitative evidence of significant upside.
What this means for investors
For investors, the Deeply Undervalued verdict for RDN, coupled with an +48.0% potential to a median fair value of $55.14 from $37.26, highlights a noteworthy investment thesis. While every investment carries risk, the Monte Carlo framework helps to quantify potential outcomes. Even with an unrated quality tier, the substantial fair value gap identified by the simulations points to considerable headroom for appreciation under various scenarios. To fully understand RDN's risk-reward profile, including detailed bear-case and bull-case scenarios, sign up for a free FairCurve account to see the full Monte Carlo distribution and track RDN's fair value as new fundamentals are released.
Frequently Asked Questions
Is RDN overvalued or undervalued right now?
Based on Monte Carlo simulations, RADIAN GROUP INC (RDN) is currently deeply undervalued. Our median fair value estimate (P50) is $55.14, significantly above the current market price of $37.26.
What is the bear case and bull case for RDN?
The full Monte Carlo distribution, including specific bear (P10) and bull (P90) target prices, along with the probability of achieving upside, is available with a free FairCurve account. We do not provide these specific figures publicly.
How does FairCurve calculate RDN's fair value?
FairCurve calculates RDN's fair value using a sophisticated Monte Carlo simulation framework. This involves running thousands of forward-looking scenarios to determine the intrinsic value under a wide range of market conditions.
How can I track RDN's fair value as it changes?
You can add RDN to your free FairCurve watchlist to receive daily updates on its fair value. FairCurve also instantly re-evaluates RDN's fair value whenever new earnings are released, keeping you informed.