#2: MGIC Investment
MGIC Investment (MTG) is a private mortgage insurer that has gone gangbusters in 2013 along with a resurgent housing market. The company backs up loans for borrowers who can’t put down a lot of money on their home until there’s enough equity in the house to cover the cost of a bad mortgage should the borrower default.
These are typically FHA loans, since MGIC is the largest mortgage insurer for Freddie Mac and sister mortgage-financing company Fannie Mae.
With brisk homebuying lately and a drop in bad mortgages, MGIC is in the right place at the right time. Of course, like Caesars, this is a company that is having trouble turning a profit right now, so buyers should beware of expecting too much after a big run and a lack of earnings — even if the business is looking up.