RLI (RLI) AI Stock Analysis

• Market Cap: $5.67B
• Dividend Yield: 4.21%
• Average Volume (3M): 645.01K
• Price to Earnings (P/E): 16.2
• Beta (1Y): 0.20
• Revenue Growth: 3.72%
• EPS Growth: -16.23%
• Country: US
• Employees: 1,147
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Property & Casualty
• EPS (TTM): 0.83
• Shares Outstanding: 91,837,840
• 10 Day Avg. Volume: 583,083
• 30 Day Avg. Volume: 645,013
• PEG Ratio: 1.66
• Price to Book (P/B): 4.96
• Price to Sales (P/S): 4.26
• P/FCF Ratio: 13.58
• Enterprise Value/Market Cap: 1.08
• Enterprise Value/Revenue: 3.31
• Enterprise Value/Gross Profit: 4.56
• Enterprise Value/Ebitda: 14.34
• 1Y Price Target: $71.00
• Price Target Upside: 14.22% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 6
• EPS Forecast (FY): 3.33
• Revenue Forecast (FY): $2.05B

• Rating: 74 Outperform
• Price Target: $67.00 ▲(7.79% Upside)

RLI's overall stock score of 74 reflects its strong financial performance and positive earnings call highlights, which are offset by bearish technical indicators. The company's solid valuation and attractive dividend yield further support the score, despite challenges in certain segments.

Positive Factors

Strong Underwriting Profitability

The strong underwriting profitability, indicated by an 85 combined ratio, showcases RLI's effective risk management and pricing strategy, which is crucial for long-term financial stability and competitiveness in the insurance industry.

Significant Growth in Book Value

The significant growth in book value per share reflects RLI's ability to enhance shareholder equity, indicating robust financial health and potential for sustained value creation for investors.

Increase in Net Investment Income

The 12% increase in investment income enhances RLI's overall profitability and provides a stable income stream, supporting its financial resilience and ability to invest in growth opportunities.

Negative Factors

Property Segment Premium Decline

The decline in property segment premiums suggests potential challenges in maintaining market share and pricing power, which could impact revenue growth and profitability in the long term.

Surety Premium Downturn

The downturn in surety premiums indicates pressure in this business line, potentially affecting RLI's diversification and revenue stability if the trend continues.

Challenges in Transportation Division

The decline in transportation premiums, despite rate increases, highlights competitive pressures and market challenges that could hinder growth and profitability in this segment.

RLI Business Overview & Revenue Model

Company Description

RLI Corp., an insurance holding company, underwrites property and casualty insurance in the United States and internationally. Its Casualty segment provides commercial and personal coverage products; and general liability products, such as coverage for third-party liability of commercial insureds, including manufacturers, contractors, apartments, and mercantile. It also offers coverages for security guards and in the areas of onshore energy-related businesses and environmental liability for underground storage tanks, contractors and asbestos, and environmental remediation specialists; and professional liability coverages focuses on providing errors and omission coverage to small to medium-sized design, technical, computer, and miscellaneous professionals. This segment provides commercial automobile liability and physical damage insurance to local, intermediate and long haul truckers, public transportation entities, and other types of specialty commercial automobile risks; incidental and related insurance coverages; inland marine coverages; management liability coverages, such as directors and officers liability insurance, fiduciary liability and coverages, employment practice liability, and for various classes of risks, including public and private businesses; and healthcare liability and home business insurance products. The company's Property segment offers commercial property, cargo, hull, protection and indemnity, marine liability, inland marine, homeowners' and dwelling fire, and other property insurance products. Its Surety segment offers commercial surety bonds for medium to large-sized businesses; small bonds for businesses and individuals; and bonds for small to medium-sized contractors. The company also underwrites various reinsurance coverages. It markets its products through branch offices, brokers, carrier partners, and underwriting and independent agents. RLI Corp. was founded in 1965 and is headquartered in Peoria, Illinois.

How the Company Makes Money

RLI generates revenue primarily through the underwriting of insurance policies and the collection of premiums from policyholders. The company earns money by assessing risks and charging premiums that are intended to cover potential claims, operating expenses, and generate profit. Key revenue streams include the sale of specialty insurance products in commercial and personal lines, as well as fees associated with surety bonds. Additionally, RLI invests the premiums it collects in various financial instruments, which can provide further income through investment returns. The company's strategic partnerships with agents and brokers also contribute to its earnings by expanding its distribution network and market reach.

RLI Financial Statement Overview

Summary

RLI demonstrates strong financial health with robust profitability, efficient operations, and a solid balance sheet. The company maintains low leverage, ensuring financial stability, and exhibits strong cash generation capabilities. While there are minor declines in certain metrics, the overall trajectory remains positive, positioning RLI well within the insurance industry.

Income Statement

RLI's income statement shows strong profitability with a TTM gross profit margin of 80.8% and a net profit margin of 19.0%. Revenue growth is positive at 4.8% TTM, indicating a healthy upward trend. EBIT and EBITDA margins are robust at 23.8% and 23.0%, respectively, reflecting efficient operations. However, the slight decline in net income from the previous year suggests potential challenges in maintaining profit levels.

Balance Sheet

The balance sheet is solid with a low debt-to-equity ratio of 0.016, indicating minimal leverage and financial risk. The return on equity is strong at 12.7%, showcasing effective use of equity to generate profits. The equity ratio stands at 28.9%, reflecting a stable capital structure. However, the slight decrease in ROE from the previous year suggests a need for improved equity utilization.

Cash Flow

Cash flow analysis reveals a healthy free cash flow growth rate of 6.2% TTM, indicating strong cash generation capabilities. The operating cash flow to net income ratio is high at 5.7, demonstrating efficient cash conversion. The free cash flow to net income ratio is nearly 1, indicating that the company effectively converts its profits into cash. However, the slight decline in free cash flow growth compared to the previous year suggests potential challenges in sustaining cash flow momentum.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.86B	1.77B	1.51B	1.70B	1.18B	983.63M
Gross Profit	1.35B	1.77B	1.51B	731.77M	1.18B	983.63M
EBITDA	427.75M	441.55M	-5.54M	736.71M	322.33M	184.64M
Net Income	353.02M	345.78M	304.61M	583.41M	279.35M	157.09M
Balance Sheet
Total Assets	6.25B	5.63B	5.18B	4.77B	4.51B	3.94B
Cash, Cash Equivalents and Short-Term Investments	218.33M	114.70M	3.03B	59.05M	88.80M	62.22M
Total Debt	100.00M	100.00M	100.00M	199.86M	199.68M	149.49M
Total Liabilities	4.37B	4.11B	3.77B	3.59B	3.28B	2.80B
Stockholders Equity	6.25B	1.52B	1.41B	1.18B	1.23B	1.14B
Cash Flow
Free Cash Flow	585.01M	555.51M	458.34M	244.56M	376.60M	257.49M
Operating Cash Flow	585.53M	560.22M	464.26M	250.45M	384.90M	263.26M
Investing Cash Flow	-349.30M	-318.87M	-211.80M	48.88M	-274.83M	-167.99M
Financing Cash Flow	-244.25M	-237.98M	-238.85M	-365.31M	-83.49M	-79.26M

RLI Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 62.16
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RLI, the sentiment is Negative. The current price of 62.16 is above the 20-day moving average (MA) of 60.44, below the 50-day MA of 63.24, and below the 200-day MA of 70.54, indicating a neutral trend. The MACD of -0.43 indicates Negative momentum. The RSI at 53.28 is Neutral, neither overbought nor oversold. The STOCH value of 91.47 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RLI.

RLI Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MCY	78 Outperform	$4.76B	10.84	21.47%	1.67%	6.18%	-21.28%
THG	75 Outperform	$6.49B	10.54	20.02%	1.99%	5.26%	72.46%
RLI	74 Outperform	$5.67B	16.17	19.49%	4.21%	3.72%	-16.23%
SIGI	74 Outperform	$4.75B	12.10	12.22%	1.99%	10.98%	74.87%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
WTM	65 Neutral	$4.86B	34.59	2.95%	0.05%	-4.24%	-78.10%
KMPR	58 Neutral	$2.16B	9.62	9.03%	2.90%	4.51%	-8.29%

RLI Corporate Events

RLI Corp’s Omission of Key Disclosures: A Risk to Investor Confidence and Market Reputation

RLI Corp faces a business risk related to the lack of disclosures in certain regulatory areas, such as mine safety and unregistered sales of equity securities, which are marked as not applicable. This absence of information could raise concerns among stakeholders about the company’s transparency and compliance with industry regulations. While these specific disclosures may not be directly relevant to RLI Corp’s operations, the omission might still affect investor confidence and potentially impact the company’s reputation in the financial market. Therefore, it is crucial for RLI Corp to ensure clarity and transparency in all regulatory aspects to mitigate any potential risks associated with perceived non-compliance.

RLI Corp. Reports Strong Q3 2025 Earnings Growth

RLI Corp. is a specialty insurer that operates in niche property, casualty, and surety markets, offering deep underwriting expertise and superior service to both commercial and personal lines customers across the United States. The company is known for its consistent dividend payments and strong underwriting performance.

RLI Corp’s Earnings Call: Strong Growth Amid Challenges

RLI Corp’s recent earnings call painted a picture of robust financial health, with strong growth in book value and underwriting profitability. The sentiment was largely positive, bolstered by increases in investment income. However, there were noted challenges in the property segment and a decline in surety premiums, which present areas of concern for the company.

RLI Announces Quarterly Dividend Amidst Strong Performance

On August 14, 2025, RLI Corp. announced that its Board of Directors approved a regular quarterly dividend of $0.16 per share, payable on September 19, 2025, to shareholders of record as of August 29, 2025. This announcement marks the continuation of RLI’s impressive track record of increasing dividends for 50 consecutive years, reflecting the company’s stable financial performance and commitment to delivering shareholder value.

The most recent analyst rating on (RLI) stock is a Hold with a $76.00 price target. To see the full list of analyst forecasts on RLI stock, see the RLI Stock Forecast page.