Genworth Advances as Mortgage Unit ReboundsZachary Tracer
Genworth Financial Inc., the seller of life insurance and long-term care coverage, posted the second-biggest gain in the Standard & Poor’s 500 Index after the unit backing U.S. home loans reported its first profit since the financial crisis.
Genworth gained 5.3 percent to $10.56 at 9:48 a.m. in New York. The Richmond, Virginia-based company has gained 41 percent this year.
Operating profit at the U.S. mortgage-insurance division was $21 million, the first positive result since 2007, as the housing market improves, the company said late yesterday in a statement. Net income was $103 million in the first three months of 2013, more than twice as much as the same period last year.
The U.S. mortgage-guaranty unit “provided the biggest highlight,” Mark Palmer, an analyst at BTIG LLC, wrote in a research note. “Genworth’s performance going forward will be a function of management’s ability to execute from an operational ‘blocking and tackling’ perspective.”
Mortgage insurers MGIC Investment Corp. and Radian Group Inc. have surged this year as the U.S. scales back its role in the housing market and home prices rise. The firms cover losses when homeowners default and foreclosures fail to recoup costs.
Humana Inc. had the biggest gain in the S&P 500 today, rallying 7.4 percent.