Essent Group Ltd Q4 2025 Earnings Call Transcript

Essent Group Ltd (NYSE: ESNT) Q4 2025 Earnings Call dated Feb. 13, 2026

Presentation

Operator

Hello and thank you for standing by. My name is Tiffany and I will be your conference operator today. At this time I would like to welcome everyone to the Essent Group Limited fourth quarter earnings call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press Star then number one on your telephone keypad. I would now like to turn the call over to Phil Stefano, Investor Relations. Phil, please go ahead.

Phil Stefano — Investor Relations

Thank you, Tiffany. Good morning everyone and welcome to our call. Joining me today are Mark Casal, Chairman and CEO, and David Weinstock, Chief Financial Officer. Also on hand for the Q and A portion of the call is Chris Karan, President of Essen Guaranty. Our press release, which contains Essen’s financial results for the fourth quarter and full year 2025, was issued earlier today and is available on our website@essentgroup.com prior to getting started, I would like to remind participants that today’s discussions are being recorded and will include the use of forward looking statements. These statements are based on current expectations, estimates, projections and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially.

For a discussion of these risks and uncertainties, please review the cautionary language regarding forward looking statements in today’s press release. The risk factors included in our Form 10K which was filed with the SEC on February 19, 2025 and any other reports and registration statements filed with the SEC which are also available on our website. Now let me turn the call over to Mark.

Mark Casale — Founder, Chairman, Chief Executive Officer and President

Thanks, Phil and good morning everyone. Earlier today we released our financial results for the fourth quarter and full year of 2025. Our strong performance this year was driven by positive credit trends and the benefit of higher interest rates on both persistency income. These results demonstrate the strength of our buy, manage and distribute operating model in generating high quality earnings which has enabled us to take a more strategic approach to capital management. For the fourth quarter of 2025, we reported net income of $155 million or $1.60 per diluted share. For the full year we earned $690 million or $6.90 per diluted share, while generating a return on average equity of 12%.

As of December 31, our book value per share was $60.31, an increase of 13% from a year ago. As of December 31, our mortgage insurance in force was $248 billion, a 2% increase versus a year ago. Our 12 month persistency on December 31 was 86%, with roughly 60% of our in force portfolio having a note rate of 6% or lower. Over the last several quarters, persistency has been relatively flat, reflecting higher mortgage rates and a smaller origination market. As a result, we believe that over the near term earned premium and insurance in force growth will be modest.

The credit quality of our insurance in force remains strong, with a weighted average FICO of 747 and a weighted average original LTV of 93%. Our portfolio default rate increased modestly quarter over quarter, reflecting normal seasonality and the continued aging of our insurance in force. Looking forward, we believe that the substantial home equity embedded in our in force book should mitigate ultimate claims. Outward Reinsurance continues to play an integral role in operating our business. At the end of 2025, 98% of our mortgage insurance portfolio was subject to some form of reinsurance. During the fourth quarter of 2025, we entered into a quota share transaction with a panel of highly rated reinsurers, providing forward protection for our 2027 business.

We remain pleased with the execution of our reinsurance strategy, ceding a meaningful portion of our mezzanine credit risk and diversifying our capital resources. On the Bermuda front, essenreit continues to be a very effective platform in deploying capital and generating additional earnings for Essent. For 2025, Essent Re earned nearly $80 million in third party net income while ending the year with $2.3 billion in risk. In addition, during the fourth quarter, SNRE entered into quota share reinsurance agreements backed by funds at Lloyd’s to reinsure certain property and casualty risks. These agreements are effective in the first quarter of 2026 and we expect 100 to $150 million of written premium with approximately two thirds to be earned in 2026 at a combined ratio consistent with a diversified PNC reinsurance company.

Looking forward, we believe that PNC will be an ongoing opportunity to generate supplemental earnings for essenreit. On the title front, we remain focused on activations, leveraging our lender network and building out our transaction management system. However, as a primarily centralized refinance platform, our title operations are unlikely to have a substantial impact on earnings unless there’s a material decrease in mortgage rates. Our consolidated cash and Investments as of December 31st totaled $6.6 billion with an aggregate yield for the year of 3.9%. New money yields on our core portfolio in the fourth quarter were nearly 5%, holding largely stable over the past several quarters.

We continue to operate from a position of strength with $5.8 billion in GAAP equity access to $1.3 billion in excess of loss reinsurance and $1.3 billion in cash and investments at the holding companies. With a full year 2025 operating cash flow of $856 million, our franchise remains well positioned from an earnings, cash flow and balance sheet perspective. We remain committed to a measured and diversified capital strategy which enabled us to return nearly $700 million to shareholders in 2025. Between dividends and repurchases during the year, we repurchased nearly 10% of the shares outstanding at the end of 2024.

Furthermore, I am pleased that our board has approved a 13% increase in our quarterly dividend to $0.35 per share starting in the first quarter of 2026. Now let me turn the call over to Dave.

David Weinstock — Chief Financial Officer and Senior Vice President

Thanks Mark and good morning everyone. Let me review our results for the quarter in a little more detail. For the fourth quarter we are $1.60 per diluted share compared to $1.67 last quarter and $1.58 in the fourth quarter a year ago. Considering S&RE’s expansion into the Lloyd’s market, as Mark noted, we began to assess the performance of all third party reinsurance as an operating segment in the fourth quarter. To reflect this change, GSE and other mortgage risk share is no longer aggregated with US Mortgage insurance and all third party reinsurance is now disclosed as a separate reportable segment called reinsurance.

All prior period segment information has been recast to conform to the new segment presentation. Our comments today are going to focus primarily on our results of our mortgage insurance segment. There’s additional information on reinsurance and corporate and other results in Exhibits D and E of the Financial Supplement. Our mortgage insurance Portfolio ended the fourth quarter with insurance in force of $248.4 billion, a decrease of $452 million from September 30 and an increase of $4.7 billion or 1.9% compared to $243.6 billion at December 31, 2024. Persistency at December 31, 2025 was 85.7% compared to 86% at September 30, 2025.

Mortgage insurance net premium earned for the fourth quarter 2025 was $213 million. The average base premium rate for the mortgage insurance portfolio for the fourth quarter was 41 basis points consistent with last quarter and the average net Premium rate was 34 basis points, down 1 basis point from last quarter. We expect that the average base premium rate for the full year 2026 will be approximately 40 basis points. Our mortgage insurance provision for losses and loss adjustment expenses was $55.2 million in the fourth quarter of 2025 compared to $44.2 million in the third quarter of 2025 and $37.2 million in the fourth quarter.

Year ago at December 31, the default rate on the mortgage insurance portfolio was 2.5% of 21 basis points from 2.29% at September 30, 2025. For the full year 2025, we recorded a net provision on the mortgage insurance portfolio of approximately $145 million with higher defaults reflecting the seasoning of the portfolio. Mortgage insurance operating expenses in the fourth quarter were $34.3 million and the expense ratio was 16.1% compared to $31.2 million and 14.4% last quarter. For the full year 2025, operating expenses for the Mortgage Insurance segment totaled $140 million and we expect that operating expenses for the mortgage insurance segment will be approximately $145 million for the full year 2026.

On December 31, Essen Guaranty’s PMIRs efficiency ratio was strong at 169% with $1.4 billion in excess available assets. Consolidated net investment income and our average balance of cash and investments available for sale in the fourth quarter were largely unchanged from last quarter. Due to our share repurchase activity, the consolidated effective tax rate for the full year 2025 was 16%, including the impact of $2.1 million of favorable discrete tax items. For 2026, we estimate that the annual effective tax rate will be approximately 17% excluding the impact of any discrete items. As Mark noted, our total holding company liquidity remains Strong and includes $500 million of undrawn revolver capacity.

Under our committed credit facility at December 31, we had $500 million of senior unsecured notes outstanding and our debt TO capital ratio was 8% in the fourth quarter. Essen Guaranty paid a dividend of $280 million to its U.S. holding company as of January 1. Essent Guaranty can pay ordinary dividends of $246 million in 2026. At quarter end, Essent Guaranty’s statutory capital was $3.6 billion with a risk to capital ratio of 9.1 to 1. Note that statutory capital includes $2.6 billion of contingency reserves at December 31. During the fourth quarter, Ess Re paid a dividend of $100 million to Essen Group.

Also in the quarter, Essent Group paid cash dividends totaling $29.5 million to shareholders and we repurchased 2 million share for $125 million. In January 2026, we repurchased 713,000 shares for $44 million. Now let me turn the call back over to Mark.

Mark Casale — Founder, Chairman, Chief Executive Officer and President

Thanks, Dave. In closing, our 2025 results demonstrate Essen’s resilient financial performance. And in a challenging housing market, we delivered a strong return on equity and book value per share growth While retiring nearly 10% of our share count through value accretive repurchases. The normalization of credit continues but our high quality portfolio remains positioned for a range of economic scenarios. As we explore new opportunities. We believe this disciplined strategy serves the best interest of our stakeholders and positions essent to create long term shareholder value. Now let’s get to your questions.

Question & Answers

Operator

Operator, at this time if you would like to ask a question, press Star then the number one on your telephone keypad. To withdraw your question, simply press Star one again. We will pause for just a moment to compile the Q and A roster. Your first question comes from the line of Mehir Bhatia with Bank of America. Please go ahead.

Mihir Bhatia — Analyst, Bank Of America

Good morning. Thanks for taking the question. Maybe just like. Let’s just start with the decision to enter the Lloyds market. I guess you know why now maybe talk a little bit about the strategy that you’re doing there, what type of assets you’re looking to underwrite. Maybe just help us understand what exactly is happening there for both strategically and operationally.

Mark Casale — Founder, Chairman, Chief Executive Officer and President

Thank you. Sure. Thanks for the question. I would say it’s been in process for a while. We have been studying ways to expand S&RE. So think of it here more as S and RE expansion versus we’re jumping in to a new line of business. When you take a look at S&RE, it’s a valuable asset. I mean over the years it’s done the affiliate quota share. They’ve written a lot of really high quality GSE risk share business. They have a nice MGA where we assist 10 other larger insurance companies to write GSE credit share risk. But because when you combine all three of them, we’re sitting there with a $1.7 billion balance sheet single A rated from AM Best A, S and P.

It’s one of the larger reinsurance companies in Bermuda. And because of the changes over the past several years, one just investment yields went up. There’s a lot of asset leverage within PNC where on the MI side we’re generally 1 to 1 in PNC you could be 2 to 1, some cases 3 to 1. So there’s nice asset leverage. Clearly that’s a lot more valuable when yields go up. Second, S&P a couple of years ago now changed their capital, their capital rules. So there’s a lot more capital, I would say efficiencies when writing PNC on top of MI kind of get that diversification benefit.

Right. And third, it’s clearly not correlated to the consumer. Those I would say attributes. Probably 18 months ago is when we started to look at it. So you know, we’ve been looking at various ways and we thought Lloyd’s was a very efficient way for us to kind of, you know, step into the market. $50 million of foul. Lloyd’s itself is kind of a self contained market, very capital efficient. The 50 million that we’re putting in is actually sitting on SMRE’s balance sheet. So there’s no additional capital required. I think that’s important for folks to realize.

And it’s really well diversified. So I would say 87% of the business roughly is insurance versus reinsurance. Our top 40 plus syndicates that we’re backing reinsuring and it’s across generally well diversified across most lines. Less, you know, we kind of made a conscious decision to be a little less weighted towards property cat just because of the volatility there. And that’s one where you know, we still have more, I would say more work to do. We’ve hired a small team and they’re very experienced in the PNC business, very technical. So they have actuarial backgrounds which we like.

We’re very technical. Right. We talk a lot about unit economics and balance sheet and all those sort of things. They kind of fit our style. And we’ll continue to build that team out. It’s not going to be very material. So I don’t want to play this up that we’ve entered into a new business. It’s not transformational, it’s very measured because that’s how we like to do things. And as we learn over time, remember one of the advantages we have at Essent because we’re kind of a founder operated company, we all own a lot of shares, we have a long term view.

And I was in London a few times last year and I met most of the syndicates that were backing within the top 10 and I looked at them and said, do we want to invest with them? Because it’s essentially what we’re doing. I know we’ll recognize it as premiums, but think of it also as kind of almost like a big watching line. So we’ll certainly update you guys with the leverage and we may with that platform, we also have the opportunity to write whole account quota share with larger reinsurance companies. Kind of like how we do it, you know, on the MI side and the relationships that we have.

There may be a way for us to partner with some over time. Again, not really in the 2026 forecast. We’ll see how it goes. But a pretty measured approach. But, you know, similar to Title, which is still kind of in that incubation phase and starting to do, you know, we’re starting to see some real good signs. They’re just nice call options for our investors. So it’s not, you know, it’s not like we’re going to buy back less shares. It’s a way for us to learn the business. We’ll continue to attract talent to the organization, both in the Bermuda and us.

And if there’s a time and we realize where we are in the cycle, we know it’s entering into, you know, kind of it’s getting a little softer in certain segments of the market. That’s fine. You’re never going to. We’re not trying to time the market. We look at this as an opportunity again, longer term for 5, 10 years. If successful, it will generate supplemental earnings, you know, for the company and help us. It’s like another tool I have to grow book value per share.

Mihir Bhatia — Analyst, Bank Of America

That’s helpful, thank you. Maybe just switching to the MI business for a second. I know you don’t manage the market share, so I’m not. It really. This really isn’t a market share question. But, you know, you look at it. And you’re, I think of TMIs that have reported so far, you’re the only one that’s got niw lower quarter over quarter. So is that just a reflection of you not liking the returns in the market? Is there a conscious decision to pull back in certain parts of the market or risk grades or something like, I guess help us understand what’s happening there?

Mark Casale — Founder, Chairman, Chief Executive Officer and President

Yeah, I wouldn’t read too much into it. You know, you’ve heard me say before, it kind of ebbs and flows. For the year we were 15, we always say we’re going to be 15, 16. We really try to optimize the unit economics. We haven’t, you know, I want to say we backed off a couple things earlier in the year. You know, you had the tariffs coming. You know, we probably cut Some of the tails, you know, and that’s probably a little bit of that. That’s okay. I mean, if you look at, we went back here and if we were 2 points higher in share for the last 3 years, it’s, it’s, it all comes out in the wash.

And there’s really no. The price, volume, trade off, especially the better credits is just not there. It’s just not there. We’d rather take that dollar and give it back to shareholders. And I’m telling you, I’m warning investors because this is just a price game. And if we’re like bottom and share and the number one or two guys, 5 billion ahead of us in this market here, it’s price. And we’re not, we don’t. Again, that’s. Everyone has their own strategy. We, we think a dollar rather than put it into a loan at a super low premium, I’ll give it back to shareholders.

So we’re fine. And then, you know, we’ll, we’ve, in times of dislocation, like 2020, we broke the most market share. So, you know, longer term market share is really a result of some of the things you do. We’re very, I would say when you kind of take a look at us again, some of the advantages we have. Look at our gross premium yield. It’s the highest in the industry, like 3 points higher than the average. It’s pretty high. And run that over $250 billion book, it’s pretty meaningful. So those are real economics to the company.

Look at our gross. This will all be available, I guess, when all the K’s come out. But look at our gross operating expenses relative to our peers. Add back the ceding commission. Right. Because everyone looks and talks about net expenses. It’s really not gross expenses, which is cash going out the door. There’s a form of leverage. There’s. We outperform the industry. And so when you think about. And it’s a relatively sizable advantage versus a few. That expense efficiency allows us to build a team in Bermuda. It allows us to build out a system in title.

Those are things again, since we manage the business so well, these are ways for us to kind of create competitive advantages. Clearly on the technology side with Snedge, you know, we have been monetizing AI now for seven years. You know, we haven’t done the new AI, but machine learning. And what we’re doing in the edge is flat out artificial intelligence. But we’re monetizing. We’re not just talking about it. You can see that in our Premium yield. That’s another good example of how we’re thinking about the business. So again, back to market share. I’d rather have better unit economics at a smaller share than, you know, the other way around.

Mihir Bhatia — Analyst, Bank Of America

Got it. Thank you. Thank you for taking my questions.

Operator

Your next question comes from the line of Bose George with kbw. Please go ahead.

Bose George — Analyst, Kbw

Hey guys, good morning. Actually, just to follow up on that last question, your gross premium Yield has been 41 basis points for a few quarters. It guided to 40 next year. Is that just kind of a rounding issue or anything tied to market returns?

Mark Casale — Founder, Chairman, Chief Executive Officer and President

No, it’s been 41% for a while. Those and if you just think about it, actually it probably was lower than that. I was actually looking at it the other day. It was lower than that in kind of the 21, 22 period. And remember, if you think about 1Q22 when I commented how low pricing was, there was kind of a reversal then and pricing kind of came up in the industry and it kind of rolls through because remember you’re talking about insurance force. So it’s tough to get a, it’s tough for, there’s not a lot of transparency for analysts and investors on what the premium yield is upfront.

You can kind of sense though, you know, you guys should look at kind of where gross premium yields were for all the companies 2/4 ago, 4/4 ago. That’ll give you a good hint, a leading indicator as what people are pricing in on the front end. So I think for us it actually went up when pricing went up and clearly pricing, it’s been relatively stable. But as that pricing starts to compress and it has compressed a little bit in 2025, but the compression isn’t really competitively oriented. There’s a little bit of that, but it’s really driven by credit.

When we look at the credit that’s coming in like 757, we rounded it up but our LTV in the fourth quarter was shy of 92. So all of a sudden if you think about the old fashioned rate card, you’re in that one quadrant where it’s super, super good credit quality but lower premium. So that’s driving a little bit of it. So I wouldn’t get too, we’re not too fussed about it. I mean once, you know, once the home, the homeowners that are on the sidelines come back down and we get kind of that 747, 45, 93 LTV, you’ll see that pricing come back up and that’ll work its way into the yield.

So it’s a way for us to kind of just give you guidance to run the models.

Bose George — Analyst, Kbw

Okay, great, that’s helpful. Thanks. And then you noted that insurance enforced growth is likely to be modest. I mean this year was 1.9% looks like year over year, which is kind of already in the modest camp. So is it like going to be, do you think it’s going to be sort of below that level or kind of in that range?

Mark Casale — Founder, Chairman, Chief Executive Officer and President

I think within that range. Again it’s, I do think longer term, I hate to say longer term, but it is longer term that housing will continue to grow, there’ll be renewed growth bows. I mean the demographics, 4 to 5 million in that age group, kind of 28 to 32 are coming in to that homeownership camp every year. But the lack of, given where rates are, the lack of affordability, little lack of supply, they’re just on the sidelines. And when they come off the sidelines, I don’t know, but when they do, it’s going to be, I think it’s going to be a bigger spike than people think.

My crystal ball doesn’t work in those type of increments. I think we’re well positioned. So again, from an essent perspective, credit is relatively benign still. And as long as credit stays benign and we can continue to kind of produce the type of cash flow we’re producing and really just use the return of the shareholders, we’re kind of paid to wait, so we’re fine with that. So again, modest growth, again, that’s a little bit of us trying to guide investors and analysts to what they expect because the numbers are the numbers and we don’t want to.

We’d rather kind of under promise and over deliver than the reverse.

Douglas Harter — Analyst, Ubs

Okay, great. Thank you.

Operator

again If you would like to ask a question, press Star one on your telephone keypad. Your next question comes from the line of Doug Harder with ubs. Please go ahead.

Douglas Harter — Analyst, Ubs

Thanks. Good morning, Mark. Can you talk about what you’re seeing in CURE activity and whether you’re seeing any difference across the vintages, you know, especially the vintages that maybe have a little bit less embedded home price appreciation?

Mark Casale — Founder, Chairman, Chief Executive Officer and President

Yeah, good question. You know, it’s not really, I mean we have 20,000 defaults. If you break it out by vintage, if you break it out by state, if you break it out by lender, if you break it out by servicer, there’s nothing really stands out. I mean Florida’s a little higher because we have some hurricanes. And I would say that the Florida book is probably our higher premium book, but there’s a little bit more risk there. We’re fine with that. We love the unit economics in Florida, in Texas, but now it’s really. We’re always looking for something, but we haven’t really seen anything.

And even, you know, the pre 22 book, and I always like that we always call kind of the two books, right? It’s the pre, you know, go halfway through 22 and before is one book. And then the kind of the newer book, which was at elevated HPA and higher interest rates. We’re not seeing much of a difference there. That’s probably a more normal business. That’s probably a more normal high LTV MI type, you know, portfolio. We’re not seeing anything there too. I mean, you’re going to see noise. And we still see it with foreign forbearance, which ultimately is a good answer for borrowers.

But it does create some noise in terms of the defaults in the ins and outs. But again, roughly 800,000 loans. There’s only 20,200 defaults. I think it was 18,000 plus 12 months ago. So it’s really benign, maybe too light of a word. But we’re not really, we’re not too fussed about where defaults are. It comes down to unemployment, Doug. I mean, at some point if it rains, like every blade of grass is going to get wet. So we keep our eyes on unemployment. That’s where we’re always looking for pebbles. It’ll happen, something will hit us at some point.

We just, you know, we’re not seeing it in the. Obviously not seeing it. In fact, the credit coming in has never been better. We’re not seeing, and I know you follow a lot of them too. We don’t see it in a lot of the consumer finance. We’re not seeing it in the cards. FHA is pretty elevated, but other than that, we’re not, you know, we’re super, I would say, very, very happy with the portfolio and the performance of the book. And even then, if default rates do spike at some point, you know, look at where our claim rate is.

So the embedded home equity helps a lot. I think our claim rate probably right around 1% ever to date. So, I mean, there’s some good protections. And I think it’s a little, again, it’s just a little underappreciated from the investor community, which is, I mean, again, if you look at just where we’re at, book value, it’s all cash. We don’t have a lot of debt and there’s not really a lot of credit given for the future value of the cash flows. And don’t forget these future cash flows are pretty well hedged, right? I mean we own that first loss piece but the MES piece is pretty well hedged out.

So we have a high degree of confidence in the future value or the present value of those future cash flows. Hence that’s why we’re buying back shares, that’s why we pay a dividend. If we didn’t have that confidence we certainly wouldn’t be, we wouldn’t be funneling cash outside the company.

Douglas Harter — Analyst, Ubs

Great. Appreciated the answer Mark. Thank you.

Mark Casale — Founder, Chairman, Chief Executive Officer and President

You’re welcome.

Operator

Your next question comes from the line of Rick Shane with JP Morgan. Please go ahead.

Richard Shane

Hey guys, thanks for taking my question. So obviously I’ve done this a while and we follow a bunch of different companies and I’m thinking about comments from two other founder run businesses that I recall over time and one is in the middle market lending space and the comment was basically there’s no spread for a bad loan. Conversely if you’re making a massively diversified card type portfolio you’re ultimately sort of seeking an efficient frontier. You accept the fact that you’re going to have losses. They’re not idiosyncratic. It strikes me that you guys sort of try to balance both but ultimately your business is an actuarial business.

Mark. You sort of provided this cautious outlook and I’m curious if you think it is because you can’t capture price in the context of what you are concerned about in terms of credit. Is that the right way to think about this?

Mark Casale — Founder, Chairman, Chief Executive Officer and President

Yeah, I mean I think that’s, I don’t think you’re off. We’re never going to be the market leader and part of it is we don’t have to be, you know our incentives go look at the incentives of, you know they’re all in the proxy statement. Just read the incentives. People do what they’re incented to do. I’m incentive to grow book value per share. 100% of my long term incentive is growth in book value per share. We’re not incented on market share, we’re not incented on niw, we’re not incented on insurance enforce. So they’re not our.

We don’t come in every day saying we have to grow niw. Look at the incentives around the industry. Some do. So they’re going to make different trade offs. I’m not saying we’re right and they’re wrong. It’s just different people do what they’re incentive to do, we like over the long term, we like to optimize our unit economics. So what yield are we charging? What’s our loss? What’s our capital? Because over time, if you write good unit economics, that’ll flow through your P and L and conversely if you don’t, that’ll also flow through the P and L.

And again, bottom line is we want to grow book value per share. That’s our incentive. That’s why we’re doing it. And as a, as a founder run company and owning a lot of shares, I don’t. And a very, I would say very supportive and constructive board of directors who a lot of them have been with me from the beginning. We all sing from the same hymn sheet. So it’s not like they say you have to grow. You know, they’re with us in terms of how we’ll slowly grow. And I think it’s a long term boring story is what we’re at Essen, but since we’ve been public, Rick, we’ve grown.

Book value per share, 18%. Our total stockholder return is close to 12, which is equal to the S&P 500. It’s more than the S&P 400 mid cap by like 3 points. Longer term, am I going to win in the next two weeks or month or quarter? I don’t know. I don’t care. I want to win long term and the company wants to win long term. And I think that’s. So when we come in every day, and we do come in every day and we meet and we talk, it’s really like, where do we want the business to be five years from now, ten years from now? We like to work backwards as to.

And when we look at that in the context of do we invest in title, do we invest in S and Re, do we try to be number one in market share? We balance a lot of that stuff. So again, it’s our way. It’s not necessarily the right way, but as a large owner of the company, I feel very comfortable with the direction in how we’re managing the company.

Richard Shane

Got it. That helps. And just to sort of delve in a little bit more pricing hasn’t really changed that much, but you’re a little bit more cautious. Is there something that you are thinking about specifically in terms of housing credit that shifted and again, you know, you know our views on the world. So I’m curious sort of how your, what your credit outlook is here.

Mark Casale — Founder, Chairman, Chief Executive Officer and President

I wouldn’t, I wouldn’t. Like I said, the market Share ebbs and flows. Like I said at the beginning, I wouldn’t read too much into it. It’s not like we made a credit call and we went to 14% market share. It’s nothing like that. It’s around. It’s really around, kind of on the margin. And optimizing unit economics, we still do a lot of testing on pricing elasticity. You know, our view is, you know, I think with. You’ll know when we’re cautious on credit, Rick, trust me, you’ll know. I wouldn’t. It’s not a credit call. It’s more around what’s the best dollar? Is it used to, you know, kind of repurchase shares or look at other opportunities, or is it to grow niws? And I think our view is, given the strength of our balance sheet, given kind of, I would say, the liquidity advantage we have with S&RE.

We can lean in when things get, you know, when the market looks, you know, when people are a little bit more scared of the market. And we could feel like we can get more pricing right now, given where pricing is like, it really hasn’t moved. We’re just comfortable kind of being at the bottom of the package. It doesn’t really impact. If we were, like I said earlier, if we were larger, it would just require more capital. And that dollar of capital is probably just better. At this point in our life cycle, where the market is not forever, we think returning it to shareholders is really the best investment decision.

And the fact that we retired 10% of the shares, that’s a large number. And if that continues, and I would expect it to continue this year, all us being equal, all right, we bought back $45 million or 44 in January. And if we kind of stay where we’re at in terms of the market, it wouldn’t surprise me to see that level continue. And that just means a lot of our larger shareholders get to own more of the company and they get to own more of a fantastic business. So I think it’s a good thing. So don’t read Intuitive Credit.

It’s not really. I’m not making a credit call, and I know your views.

Richard Shane

I appreciate that. And I really do appreciate the answer and the conversation. Thank you, guys.

Mark Casale — Founder, Chairman, Chief Executive Officer and President

You’re welcome.

Operator

That concludes our question and answer session. I will now turn the call back over to management for closing remarks.

Mark Casale — Founder, Chairman, Chief Executive Officer and President

I’d like to thank everyone for calling in and joining the call and the questions and have a great weekend.

Operator

Ladies and gentlemen, this concludes today’s call. Thank you all for joining you may now disconnect.