Liquidity backdrop
Radian Group (RDN) has historically generated strong, recurring cash flows from its mortgage‑insurance and capital‑market franchise. In the most recent 10‑Q (ended Q2 2024) the company reported $1.1 bn of cash and cash equivalents and $1.6 bn of operating cash flow for the trailing twelve months, giving a cash‑to‑debt ratio of roughly 1.2×. The dividend of $0.255 per share translates to a $0.30 bn quarterly outlay (≈ 0.3 % of quarterly cash flow), well within the firm’s free‑cash‑flow coverage. The payout ratio sits near 30 % of net income, indicating ample headroom for the regular quarterly distribution even if earnings dip modestly.
Trading implications
Given the solid liquidity cushion, the dividend is unlikely to be at risk in the near term, which supports a neutral‑to‑bullish stance for the stock ahead of the ex‑date (Aug 25). From a technical view, RDN has been holding the $30–$32 range for the past month, with the 20‑day SMA still above the 50‑day SMA, signaling short‑term momentum. A modest pull‑back toward the lower end of the range could present a buy‑the‑dip opportunity for dividend‑seeking investors, while a break above $32 would suggest the market is pricing in stronger growth expectations and could trigger a short‑cover rally. Keep an eye on upcoming cash‑flow updates (e.g., Q3 earnings) and any changes in the debt‑to‑cash profile; a deterioration could tighten the dividend coverage and prompt a price correction.