Home » Business » MGIC Investment Corp. (NYSE:MTG)’s capital position on precarious ground, Sears Holdings (SHLD) posts smaller 4Q loss

Sears Holdings Corporation(NASDAQ:SHLD) has posted a narrower loss in the fourth quarter thanks to reduced inventory and expenses and higher sales.

The company bore a loss $489 million, or $4.61 per share, for the 3 months ended Feb. 2 against negative earnings of $2.4 billion, or $22.63 per share, in the year-ago period.

Adjusted earnings from continuing operations were $1.12 per share.

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Revenue slid 2 percent to $12.26 billion from $12.48 billion.

Revenue at U.S. stores open at least a year, a key metric, fell 1.6 percent in the quarter.

Sears lost $930 million or $8.78 per share for the full year, comparable with a loss of $3.14 billion, or $29.40 per share last year.

The company’s loss from continuing operations excluding one-time items was $2.03 per share.

Annual revenue dropped 4 percent to $39.85 billion from $41.57 billion.

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The stock fell $1.28, or 2.70 percent, to $46.19.

 

Meanwhile, mortgage insurer MGIC Investment Corp.(NYSE:MTG) has not only posted its tenth back-to-back quarterly loss, but also reported a sharp deterioration in its capital position in the fourth quarter.

Like its rivals, MGIC has been having a difficult time after the housing crisis because of the burden of large claims on unpaid home loans by lenders.

The preliminary risk-to-capital ratio at MGIC’s insurance operations was 47.8 to 1 as of December 31 against the maximum risk-to-capital ratio of 25 to 1 allowed by regulators. The company expects its risk to rise even higher this year.

However, MGIC can continue to write insurance despite its high risk levels, thanks to the waivers it has received.

It lost $386.7 million, or $1.91 per share, in the fourth quarter against a loss of $135.3 million, or 67 cents per share, in the prior-year period.

The loss in this year’s quarter included a $267.5 million settlement with Freddie Mac.

The stock had lost 9 percent and was trading at $2.55 in opening session, although off session low of $2.36.



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