Assured Guaranty Ltd.

All consolidated figures are as presented in the FY2025 10-K multi-year data and the corresponding 10-K balance sheets (USD M).

Some aggregator sites (for example Vested, Tickerleague) show materially lower "total revenue" figures — 698, 684, 1,010, 814 and 788 for FY2021–FY2025.

Income statement

Sources and notes:

• AOI history: 2023 Annual Report reconciliation (2021–2023), FY2024 and FY2025 releases.

• Dividends: quarterly rates of $0.22, $0.25, $0.28, $0.31 and $0.34, per company dividend declarations. The 2026 quarterly rate is $0.38.

GAAP diluted EPS:

• FY2022: $1.92 (FY2022 release).

• FY2025: $10.26 (FY2025 release).

• FY2024: approximately $6.89 (derived from the disclosed 49% YoY increase to $10.26).

Revenue CAGR (FY2021–FY2025, company-reported totals): about 7.0% (derived: (1110/848)^(1/4) − 1). On the aggregator basis the five-year CAGR is negative. This is a reminder that headline revenue for AGO is noisy and analytically secondary to AOI and ABV.

Gross profit, operating income, EBITDA and gross/operating/EBITDA margins are not applicable to a financial guarantor and are not reported by the company.

Commentary:

FY2022 trough: Net income fell to $124 million because of investment losses, negative equity-method results (-$39 million) and loss-mitigation costs.

FY2023 spike: Total revenues ($1,373 million) and net income ($739 million) were inflated by:

• Puerto Rico resolution-related accelerations;

• consolidation effects;

• a $93 million net tax benefit tied to the new Bermuda corporate income tax (deferred tax asset recognition).

FY2024 normalization: AOI per share was $7.10.

FY2025 rebound: AOI per share rose 28% to $9.08, helped by:

• the Q1 2025 LBIE litigation gain;

• Sound Point equity income;

• a smaller share count.

Long-run premium trend: Net earned premiums have drifted down from $494 million (FY2022) to $380 million (FY2025). The deferred premium book is amortizing faster than new production replenishes it at current PVP levels. Net investment income, meanwhile, has risen materially since FY2022 on higher reinvestment yields.

Quarterly run-rate

Sources and derivations:

• Quarterly earnings releases and 10-Qs.

• Q3 2025 revenue: $211 million per Motley Fool data; another aggregator shows $213 million.

• Q4 2025 revenue derived as FY total less Q1–Q3.

• Q2 2025 GWP derived from the 26% H1 increase and Q1 2025 GWP of $35 million. Quarterly GWP sums to the $256 million FY2025 total.

GAAP net income attributable:

• Q2 2025: $103 million ($2.08 per share).

• Q4 2025: $119 million ($2.53 per share).

• Q1 2026: $88 million ($1.91 per share).

• Q2 2026: $39 million ($0.88 per share).

Balance sheet

Sources: FY2025 10-K multi-year data; stockanalysis.com reproduction of 10-K balance sheets for cash, unearned premiums, reserves and goodwill. Goodwill disappeared after the July 2023 contribution of AssuredIM to Sound Point.

The large drop in total assets between FY2022 and FY2023 reflects deconsolidation of investment vehicles (CIVs) on the Sound Point transaction.

Latest interim (31 March 2026, Q1 2026 10-Q):

• Total investments $8,906 million; total assets $12,635 million; total liabilities $7,071 million.

• Long-term debt $1,705 million; total shareholders' equity $5,564 million.

• Equity fell from $5,789 million mainly on $128 million of after-tax unrealized investment losses plus buybacks.

• Assets of consolidated investment vehicles fell to nil from $175 million at year-end 2025.

Notes:

• FY2024 shareholders' equity per share is derived from the disclosed 15% YoY increase to $125.32.

• At 30 June 2026: shareholders' equity per share $126.18; adjusted operating shareholders' equity per share $129.94; ABV per share $189.72 — all records (Q2 2026 release).

• ABV per share has compounded at about 9.5% a year from FY2022 to FY2025 (derived).

Cash flow and capital return

Capex is immaterial and not separately meaningful for this business.

Management guidance

• No numeric guidance is given.

• Management cites a robust pipeline across all three financial guaranty lines.

• About $42 million of Q3 2026 PVP had already been committed early in the quarter.

• Assured Life Re is on track versus internal milestones.

• Management remains committed to capital return, although the H1 2026 buyback pace was slower.

Consensus expectations

• Q3 2026 EPS is about $1.71, versus $2.57 AOI per share in Q3 2025.

• Some aggregators model earnings broadly flat-to-declining (about -0.7% a year per Simply Wall St), reflecting premium run-off and a normalization of one-off gains.

Bull case

1. Deep value with a visible floor. At about 0.37x ABV ($189.72) and about 0.55x GAAP book, the market prices in severe losses. Yet expected losses on Brightline have so far not exceeded its deferred premium revenue, so AOI has not yet been affected (Q2 2026 call). Every dollar of buyback at these levels accretes ABV per share.

2. Growth re-acceleration. H1 2026 GWP rose 26% and PVP 48% year on year. Structured finance (fund finance, life capital) and secondary-market insurance are scaling, while U.S. public finance PVP in H1 2026 alone exceeded total company PVP in H1 2025.

3. Credit tail risks are being actively managed. Assured controls the Brightline senior bond vote, and the RSA preserves par with no acceleration risk. Insured debt service is interest-only through 2042, at about $58 million a year. Thames Water's first principal payment is not due until 2037.

Bear case

1. Concentrated legacy credits could crystallize real losses. Brightline ($1.13 billion, CCC), Thames Water (£1.78 billion) and PREPA ($464 million, with plan offers at 3.5% of claim) together are material relative to roughly $3 billion of market capitalization. Assured is also committing up to $178 million of new money to Brightline.

2. A structurally shrinking core. Net earned premiums fell 23% from FY2022 to FY2025. Muni penetration has halved year on year to 3.3%, and 2025 PVP missed target. Without wider spreads, organic growth may not offset run-off.

3. Diversification adds new risks and volatility. Annuity reinsurance brings longevity, ALM and hedging risk in a market dominated by better-scaled, asset-manager-backed competitors. Sound Point and CLO exposure add mark-to-market noise, such as the -$10 million equity-in-investees result in Q2 2026. Slower buybacks remove a key support for the stock.

Catalysts and monitorables (next 12 months)

1. Q3 2026 results (around 5–9 November 2026): Brightline loss development, PVP versus the $42 million early-quarter commitment, and buyback pace.

2. Brightline Chapter 11 plan confirmation, exit financing and any reserve changes.

3. Thames Water restructuring outcome and any haircut to Class A debt.

4. PREPA plan confirmation and settlement terms.

5. Assured Life Re production volumes and first meaningful segment income.

6. CEO succession signals and appointment of a new Chief Credit Officer.

7. Rating agency actions, especially any reaction to Brightline funding.

8. FY2026 results (around late February 2027) and 2027 capital return plans.

Analyst verdict

Assured Guaranty enters late 2026 as a paradox. By its own value metrics it has never been stronger: shareholders' equity, adjusted operating equity and adjusted book value per share all set records at mid-year. Its AA/AA+ ratings were reaffirmed in August, its competitive position in insured U.S. municipal finance is unrivaled, and its balance sheet carries only about $1.7 billion of debt against roughly $5.6 billion of equity.

Yet the shares have fallen more than 20% this year, to about $70. That is 0.37 times adjusted book value, a valuation implying either a large impairment of the insured portfolio or a permanent inability to earn its cost of capital.

The market's skepticism has identifiable sources. Brightline's parents are in Chapter 11. Thames Water remains unresolved. PREPA continues to default. The core premium base is shrinking while primary-market penetration has fallen to roughly 3%. The company is also asking investors to underwrite two new engines, Sound Point and annuity reinsurance, whose earnings are either volatile or embryonic.

On balance, the risk/reward skews favorably for patient, value-oriented capital. The headline exposures are large, but their structure matters:

• Brightline's insured debt is interest-only until 2042, and Assured controls the remedies.

• Thames Water's first principal payment is in 2037.

• PREPA is small relative to equity.

Meanwhile, embedded premiums, rising investment income and accretive buybacks at deep discounts compound per-share value.

The key swing factors are execution and evidence. Investors need production that sustains the H1 2026 growth rates, a Brightline exit that validates reserves, a credible succession plan for a 23-year CEO, and proof that Assured Life Re can earn adequate returns. Until those arrive, the discount will likely persist. If they do arrive, the gap between price and adjusted book value offers substantial rerating potential.

Stance: constructive / accumulate on weakness. Conviction is moderate, capped by tail-credit and key-person risk.

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It is not investment advice.