Contrasting MGIC Investment (NYSE:MTG) and Chime Financial (NASDAQ:CHYM)

Chime Financial (NASDAQ:CHYM) and MGIC Investment (NYSE:MTG) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, dividends, earnings, valuation, risk, analyst recommendations and institutional ownership.

Volatility and Risk

Chime Financial has a beta of 0.6, suggesting that its stock price is 40% less volatile than the S&P 500. Comparatively, MGIC Investment has a beta of 0.65, suggesting that its stock price is 35% less volatile than the S&P 500.

Insider & Institutional Ownership

95.6% of MGIC Investment shares are owned by institutional investors. 12.3% of Chime Financial shares are owned by insiders. Comparatively, 1.3% of MGIC Investment shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Chime Financial and MGIC Investment’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chime Financial	-0.74%	-1.28%	-0.92%
MGIC Investment	59.20%	13.90%	10.81%

Earnings & Valuation

This table compares Chime Financial and MGIC Investment”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chime Financial	$2.19 billion	5.25	-$1.01 billion	($0.07)	-433.29
MGIC Investment	$1.21 billion	5.02	$738.35 million	$3.20	9.28

MGIC Investment has lower revenue, but higher earnings than Chime Financial. Chime Financial is trading at a lower price-to-earnings ratio than MGIC Investment, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Chime Financial and MGIC Investment, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chime Financial	1	2	17	4	3.00
MGIC Investment	0	4	1	2	2.71

Chime Financial presently has a consensus price target of $36.40, indicating a potential upside of 20.01%. MGIC Investment has a consensus price target of $30.60, indicating a potential upside of 3.05%. Given Chime Financial’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Chime Financial is more favorable than MGIC Investment.

Summary

MGIC Investment beats Chime Financial on 8 of the 15 factors compared between the two stocks.

About Chime Financial

Chime is a financial technology company that partners with federally regulated, FDIC-insured banks—The Bancorp Bank, N.A. and Stride Bank, N.A., Members FDIC—to provide consumer banking products and services. The company’s model is designed to eliminate common fees and simplify access to basic financial services.

Chime does not charge overdraft fees, monthly service fees, or require minimum balances. All account balances are held at partner banks and protected by applicable regulatory safeguards to ensure funds remain secure and accessible.

About MGIC Investment

MGIC Investment Corporation, through its subsidiaries, provides private mortgage insurance, other mortgage credit risk management solutions, and ancillary services to lenders and government sponsored entities in the United States, the District of Columbia, Puerto Rico, and Guam. The company offers primary mortgage insurance that provides mortgage default protection on individual loans, as well as covers unpaid loan principal, delinquent interest, and various expenses associated with the default and subsequent foreclosure. It also provides pool insurance for secondary market mortgage transactions; and contract underwriting services, as well as reinsurance. The company serves originators of residential mortgage loans, including savings institutions, commercial banks, mortgage brokers, credit unions, mortgage bankers, and other lenders. MGIC Investment Corporation was founded in 1957 and is headquartered in Milwaukee, Wisconsin.