📊 ACT Key Takeaways
Is Enact Holdings, Inc. (ACT) a Good Investment?
Enact Holdings exhibits paradoxical fundamentals: exceptional profitability margins (68.4% operating, 53.8% net) and fortress-like balance sheet strength (0.14x leverage, 17.3x interest coverage) are offset by stagnant growth (0% net income YoY) and severely depressed capital efficiency (3.1% ROE, 2.4% ROA). The business generates strong cash ($224M FCF on $312M revenue) but fails to deploy its $7B asset base productively, suggesting structural headwinds in the insurance intermediary market.
Enact Holdings shows very strong underlying fundamentals, with exceptionally high operating and net margins, solid returns on equity and assets, and strong cash generation relative to revenue. Balance sheet leverage is low and interest coverage is healthy, which supports financial resilience, though the flat net income profile and modest top-line growth suggest the story is more about quality and stability than rapid expansion.
Why Buy Enact Holdings, Inc. Stock? ACT Key Strengths
- Exceptional profit margins (68.4% operating, 53.8% net) demonstrate pricing power and operational efficiency
- Fortress balance sheet: 0.14x debt/equity ratio with $549M cash and 17.3x interest coverage indicates zero financial distress risk
- Outstanding cash generation with 71.8% free cash flow margin relative to revenue shows high-quality earnings
- Exceptional profitability, with 69.5% operating margin and 54.6% net margin
- Strong financial health, supported by low debt-to-equity of 0.14x and 17.2x interest coverage
- High-quality cash generation, with $724.52M operating cash flow and 58.6% free cash flow margin
ACT Stock Risks: Enact Holdings, Inc. Investment Risks
- Chronic growth stagnation: net income flat YoY despite 2.8% revenue growth suggests demand headwinds or margin compression headroom exhausted
- Severely depressed capital returns (3.1% ROE, 2.4% ROA) indicate $7B asset base is underdeployed or deteriorating in quality, requiring scrutiny on asset composition
- Absence of current/quick ratios and capital expenditure detail obscures short-term liquidity and reinvestment needs; missing forward revenue guidance limits visibility
- Growth is modest, with revenue up only 2.8% and net income essentially flat year over year
- Insurance earnings can be pressured by adverse loss trends, reserve development, or changes in credit performance
- Profitability may be sensitive to regulatory changes, competitive pricing, and housing or mortgage market weakness
Key Metrics to Watch
- Net income growth acceleration vs. revenue growth (currently 0% vs. 2.8%)
- Return on equity and asset trends (current 3.1% ROE concerning)
- Operating cash flow sustainability and capital allocation policy going forward
- Net income and operating margin trend
- Operating cash flow and return on equity
Enact Holdings, Inc. (ACT) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The 71.8% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments. The current ratio below 1.0x warrants monitoring of short-term liquidity.
ACT Profit Margin, ROE & Profitability Analysis
ACT vs Finance Sector: How Enact Holdings, Inc. Compares
How Enact Holdings, Inc. compares to Finance sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Enact Holdings, Inc. Stock Overvalued? ACT Valuation Analysis 2026
Based on fundamental analysis, Enact Holdings, Inc. has mixed fundamental signals relative to the Finance sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Enact Holdings, Inc. Balance Sheet: ACT Debt, Cash & Liquidity
ACT Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Enact Holdings, Inc.'s revenue has grown significantly by 11% over the 5-year period, indicating strong business expansion. The most recent EPS of $4.11 reflects profitable operations.
ACT Revenue Growth, EPS Growth & YoY Performance
ACT Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $306.8M | $165.8M | $1.08 |
| Q3 2025 | $309.6M | $163.5M | $1.10 |
| Q2 2025 | $298.8M | $167.8M | $1.11 |
| Q1 2025 | $291.6M | $161.0M | $1.01 |
| Q3 2024 | $299.0M | $164.2M | $1.02 |
| Q2 2024 | $277.5M | $168.0M | $1.04 |
| Q1 2024 | $280.9M | $161.0M | $1.01 |
| Q3 2023 | $275.1M | $164.2M | $1.02 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Enact Holdings, Inc. Dividends, Buybacks & Capital Allocation
ACT SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Enact Holdings, Inc. (CIK: 0001823529)
📋 Recent SEC Filings
❓ Frequently Asked Questions about ACT
What is the AI rating for ACT?
Enact Holdings, Inc. (ACT) has a Combined AI Rating of BUY from Claude (HOLD) and ChatGPT (BUY) with 74% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are ACT's key strengths?
Claude: Exceptional profit margins (68.4% operating, 53.8% net) demonstrate pricing power and operational efficiency. Fortress balance sheet: 0.14x debt/equity ratio with $549M cash and 17.3x interest coverage indicates zero financial distress risk. ChatGPT: Exceptional profitability, with 69.5% operating margin and 54.6% net margin. Strong financial health, supported by low debt-to-equity of 0.14x and 17.2x interest coverage.
What are the risks of investing in ACT?
Claude: Chronic growth stagnation: net income flat YoY despite 2.8% revenue growth suggests demand headwinds or margin compression headroom exhausted. Severely depressed capital returns (3.1% ROE, 2.4% ROA) indicate $7B asset base is underdeployed or deteriorating in quality, requiring scrutiny on asset composition. ChatGPT: Growth is modest, with revenue up only 2.8% and net income essentially flat year over year. Insurance earnings can be pressured by adverse loss trends, reserve development, or changes in credit performance.
What is ACT's revenue and growth?
Enact Holdings, Inc. reported revenue of $312.1M.
Does ACT pay dividends?
Enact Holdings, Inc. pays dividends, with $29.8M distributed to shareholders in the trailing twelve months.
Where can I find ACT SEC filings?
Official SEC filings for Enact Holdings, Inc. (CIK: 0001823529) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is ACT's EPS?
Enact Holdings, Inc. has a diluted EPS of $1.18.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is ACT a good stock to buy right now?
Based on our AI fundamental analysis in May 2026, Enact Holdings, Inc. has a BUY rating with 74% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is ACT stock overvalued or undervalued?
Valuation metrics for ACT: ROE of 3.1% (sector avg: 12%), net margin of 53.8% (sector avg: 25%). Compare these metrics with sector averages to assess valuation.
Should I buy ACT stock in 2026?
Our dual AI analysis gives Enact Holdings, Inc. a combined BUY rating for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is ACT's free cash flow?
Enact Holdings, Inc.'s operating cash flow is $224.0M, with capital expenditures of N/A. FCF margin is 71.8%.
How does ACT compare to other Finance stocks?
Vs Finance sector averages: Net margin 53.8% (avg: 25%), ROE 3.1% (avg: 12%), current ratio N/A (avg: 1.2).