RLI (RLI) AI Stock Analysis

• Market Cap: $5.37B
• Dividend Yield: 4.05%
• Average Volume (3M): 769.83K
• Price to Earnings (P/E): 13.4
• Beta (1Y): 0.18
• Revenue Growth: 3.72%
• EPS Growth: -16.23%
• Country: US
• Employees: 1,147
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Property & Casualty
• EPS (TTM): 0.94
• Shares Outstanding: 91,837,840
• 10 Day Avg. Volume: 1,111,331
• 30 Day Avg. Volume: 769,831
• 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: 1.01
• Enterprise Value/Revenue: 2.92
• Enterprise Value/Gross Profit: 11.61
• Enterprise Value/Ebitda: 12.16
• 1Y Price Target: $60.50
• Price Target Upside: 3.54% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5
• EPS Forecast (FY): 2.87
• Revenue Forecast (FY): $2.07B

• Rating: 71 Outperform
• Price Target: $63.00 ▲(7.82% Upside)

The score is supported most by strong financial performance (high profitability, very low leverage) and favorable valuation (moderate P/E with a high dividend yield), reinforced by a generally positive earnings call on underwriting results and capital generation. These positives are partially offset by weak technical signals, with the stock below major moving averages and negative momentum indicators.

Positive Factors

Sustained Underwriting Profitability

Three decades of consecutive underwriting profit and a mid-80s combined ratio demonstrate durable underwriting discipline. This consistent underwriting margin underpins earnings quality, reduces reliance on investment returns, and enhances resilience to market cycles over the medium term.

Very Strong Balance Sheet

Extremely low leverage (D/E ~0.016) and a healthy TTM ROE (~12.7%) provide financial flexibility to absorb underwriting volatility, selectively deploy capital, and pursue accretive opportunities. This structural strength supports long-term solvency and strategic optionality.

Robust Capital Generation and Book Value Growth

Strong comprehensive earnings and a 33% book value increase signal persistent capital generation. The ability to fund a sizable special dividend while investing in underwriting, distribution and analytics indicates durable free cash production and shareholder-friendly capital allocation.

Negative Factors

Modest Premium Growth and Top-Line Pressure

Very limited premium growth constrains scale and revenue leverage, especially when combined with rising expenses. If competitive dynamics persist, slower top-line expansion could limit margin recovery potential and the firm's ability to grow underwriting income organically over the medium term.

Casualty and Transportation Loss Volatility

Elevated casualty combined ratios and transportation severity, plus reduced favorable prior-year development, increase reserve uncertainty and earnings volatility. Persistent adverse trends in these lines could pressure underwriting results and capital if not offset by disciplined pricing or portfolio actions.

Rising Expense Ratio

A rising expense ratio driven by higher bonuses, profit-sharing and investments in people/technology can erode underwriting margins if premium growth slows. Sustained elevated operating costs reduce earnings leverage and require either higher rates or further efficiency gains to preserve profitability.

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 its policyholders. The company employs a disciplined underwriting approach, which helps it achieve profitability by managing risk effectively. Key revenue streams include premiums from its property, casualty, and surety insurance segments. Additionally, RLI earns investment income from its portfolio of invested assets, which consists of fixed-income securities and equity investments. Strategic partnerships with brokers and agents also enhance its distribution network, contributing to policy sales and overall revenue growth.

RLI Financial Statement Overview

Summary

Strong overall fundamentals: high profitability (TTM net margin 19.02%, EBIT margin 23.78%) and excellent balance-sheet strength with minimal leverage (debt-to-equity 0.016). Cash generation is solid versus earnings (operating cash flow to net income 5.33), though free cash flow growth is slightly negative (-6.37% TTM).

Income Statement

RLI has demonstrated consistent revenue growth with a TTM growth rate of 2.16%. The company maintains strong profitability, evidenced by a TTM net profit margin of 19.02% and an EBIT margin of 23.78%. Despite a slight decline in EBITDA margin, the overall profitability metrics remain robust, indicating effective cost management and operational efficiency.

Balance Sheet

RLI's balance sheet is characterized by a very low debt-to-equity ratio of 0.016, indicating minimal leverage and a strong equity position. The return on equity (ROE) is solid at 12.71% TTM, reflecting efficient use of equity capital. The equity ratio is high, suggesting financial stability and a strong asset base.

Cash Flow

The cash flow statement shows a slight decline in free cash flow growth at -6.37% TTM, which could be a concern if it continues. However, the operating cash flow to net income ratio is strong at 5.33, indicating good cash generation relative to net income. The free cash flow to net income ratio is nearly 1, showing that the company effectively converts its earnings into cash.

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	987.68M
Gross Profit	466.31M	454.63M	390.87M	731.77M	459.60M	307.76M
EBITDA	445.36M	441.55M	393.11M	736.71M	359.39M	204.88M
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	1.65B	114.70M	3.03B	2.73B	2.50B	2.26B
Total Debt	100.00M	100.00M	200.00M	399.73M	199.68M	149.49M
Total Liabilities	4.37B	4.11B	3.77B	3.59B	3.28B	2.80B
Stockholders Equity	1.87B	1.52B	1.41B	1.18B	1.23B	1.14B
Cash Flow
Free Cash Flow	583.63M	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: 58.43
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 58.43 is below the 20-day moving average (MA) of 59.27, below the 50-day MA of 61.78, and below the 200-day MA of 65.14, indicating a bearish trend. The MACD of -1.31 indicates Positive momentum. The RSI at 42.88 is Neutral, neither overbought nor oversold. The STOCH value of 42.85 is Neutral, 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
THG	77 Outperform	$6.20B	10.06	20.02%	1.97%	5.26%	72.46%
SIGI	74 Outperform	$5.08B	11.24	―	1.85%	10.98%	74.87%
WTM	73 Outperform	$5.07B	37.20	2.95%	0.05%	-4.24%	-78.10%
RLI	71 Outperform	$5.37B	13.38	―	4.05%	3.72%	-16.23%
MCY	69 Neutral	$4.85B	11.04	21.47%	1.34%	6.18%	-21.28%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
KMPR	52 Neutral	$2.31B	10.29	9.03%	3.15%	4.51%	-8.29%

RLI Corporate Events

RLI Announces CFO Retirement and Successor Appointment

On November 12, 2025, RLI Corp. announced that Todd W. Bryant, the Chief Financial Officer, will retire from his role on December 31, 2025, after over 30 years with the company. Bryant will remain in an advisory role through mid-2026 to support the transition of responsibilities to his successor, Aaron P. Diefenthaler, who has been appointed as the new CFO effective January 1, 2026. Diefenthaler, who has been with RLI since 2012, will receive an increased salary and participate in the Market Value Potential Executive Incentive Program as part of his new role. This leadership change reflects RLI’s commitment to strong financial stewardship and proactive succession planning.

The most recent analyst rating on (RLI) stock is a Buy with a $67.00 price target. To see the full list of analyst forecasts on RLI stock, see the RLI Stock Forecast page.

RLI Announces Special and Regular Dividends

On November 13, 2025, RLI Corp. announced that its Board of Directors approved a special cash dividend of $2.00 per share, totaling approximately $184 million, and a regular quarterly dividend of $0.16 per share. Both dividends are scheduled for payment on December 19, 2025, to shareholders recorded by November 28, 2025. This move reflects RLI’s robust financial position and commitment to long-term shareholder value, having returned over $1.6 billion to shareholders in the past decade.

The most recent analyst rating on (RLI) stock is a Buy with a $67.00 price target. To see the full list of analyst forecasts on RLI stock, see the RLI Stock Forecast page.