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RLI
(NYSE:RLI)
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Rating:82Outperform
Price Target:
$72.00
â–²(16.28% Upside)
Action:Reiterated
Date:07/25/26
RLI scores well on financial quality and valuation, led by strong profitability/ROE with generally prudent leverage and an attractive P/E plus high dividend yield. Technicals are supportive with the stock trading above key moving averages and positive momentum. The latest earnings call reinforces strength in underwriting results, investment income, and shareholder returns, though casualty profitability and expense pressure remain key near-term watch items.
Positive Factors
High profitability & ROE
Sustained net margins around 20% and a TTM ROE near 22% reflect durable underwriting discipline and capital efficiency. This level of profitability supports consistent cash generation, funds capital returns, and provides resilience through underwriting cycles, underpinning long-term shareholder returns.
Negative Factors
Near-break-even casualty underwriting
A casualty combined ratio near 100% indicates little underwriting margin in a major line, making earnings highly sensitive to frequency/severity trends. If casualty loss trends persist, management must secure higher pricing or stricter selection, or margin and long-term profitability could be structurally constrained.
Read all positive and negative factors
Positive Factors
Negative Factors
High profitability & ROE
Sustained net margins around 20% and a TTM ROE near 22% reflect durable underwriting discipline and capital efficiency. This level of profitability supports consistent cash generation, funds capital returns, and provides resilience through underwriting cycles, underpinning long-term shareholder returns.
Read all positive factors
RLI (RLI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.89B
Dividend Yield3.94%
Average Volume (3M)928.77K
Price to Earnings (P/E)13.5
Beta (1Y)0.16
Revenue Growth10.29%
EPS Growth35.39%
CountryUS
Employees1,193
SectorFinancial
Sector Strength70
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)4.76
Shares Outstanding91,772,970
10 Day Avg. Volume915,130
30 Day Avg. Volume928,773
Financial Highlights & Ratios
PEG Ratio0.92
Price to Book (P/B)3.32
Price to Sales (P/S)3.13
P/FCF Ratio9.69
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$63.00Price Target Upside1.74% Upside
Rating ConsensusHold
Number of Analyst Covering4
EPS Forecast (FY)2.85
Revenue Forecast (FY)$2.10B
RLI Business Overview & Revenue Model
Company Description
RLI Corp. is an insurance holding company that underwrites a comprehensive portfolio of property and casualty (P&C) insurance products, operating across the United States and internationally. Its business is primarily structured into three segment...
How the Company Makes Money
RLI makes money primarily from (1) insurance underwriting and (2) investment income on the assets it holds to pay future claims. Underwriting revenue comes from premiums earned on policies and bonds written across its operating segments (Casualty,...
RLI Earnings Call Summary
Earnings Call Date:Jul 22, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 26, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive operational and capital position: RLI delivered stable operating earnings, strong ROE (25%), higher investment income, favorable reserve development, and substantial capital returns (special dividend and buybacks). Management emphasized disciplined underwriting, selective growth, and service differentiation in a competitive market. Key headwinds include near-100% casualty combined ratio, expense ratio pressure, declining premiums in certain segments (E&S property and surety), and decelerating rate momentum in some lines. Overall, the company appears well-capitalized and executing a conservative, owner-minded strategy while navigating competitive and market-cycle challenges.Positive Updates
Profitability and Shareholder Returns
Reported GAAP net earnings of $1.82 per share (vs. $1.34 prior year) and operating earnings of $0.83 per share (vs. $0.82 prior year). Returned capital via a $2.00 special dividend plus regular dividend ($0.18) and activated a $250M share repurchase program (repurchased ~235k shares at $51.25; ~ $238M remaining). Comprehensive earnings were $166M ($1.80/share) vs $143M ($1.55/share) prior year. Book value per share increased ~11% from year-end 2025 after capital actions.
Negative Updates
Casualty Combined Ratio Near Break-Even
Casualty produced a combined ratio of 99.3%, indicating limited underwriting margin in the quarter despite growth. Underlying casualty loss exposure (auto/transportation) and higher accident-year loss trends were discussed as areas of careful monitoring.
Read all updates
Q2-2026 Updates
Positive
Negative
Profitability and Shareholder Returns
Reported GAAP net earnings of $1.82 per share (vs. $1.34 prior year) and operating earnings of $0.83 per share (vs. $0.82 prior year). Returned capital via a $2.00 special dividend plus regular dividend ($0.18) and activated a $250M share repurchase program (repurchased ~235k shares at $51.25; ~ $238M remaining). Comprehensive earnings were $166M ($1.80/share) vs $143M ($1.55/share) prior year. Book value per share increased ~11% from year-end 2025 after capital actions.
Read all positive updates
Company Guidance
RLI signaled continued disciplined, optimistic execution and gave directional guidance around profitability, capital returns and investment income while outlining many quarterly metrics: Q2 operating EPS was $0.83 (GAAP EPS $1.82), underwriting income $59.9M, comprehensive earnings $166M ($1.80/share), and combined ratio 85.6% (YTD 86%); loss ratio improved to 45.5% while the expense ratio rose to 40.1%, aided by $39.8M of favorable prior-year development and net incurred 2026 catastrophe losses of $10M. Top-line and business-mix metrics included 3% gross premium growth (casualty +11%, personal umbrella +26%, transportation +19%, property -6%, surety -6%), rate trends such as casualty +10%, personal umbrella +17% and transportation +8%, and higher submissions (transportation +9%, casualty brokerage +14%). Investment and balance-sheet guidance highlighted net investment income up 17% to $46M, purchase yields averaging 4.9%, portfolio total return 3.4% for the quarter (3.0% YTD), operating cash flow $145M, total investments & cash ≈ $4.9B, book value per share +11% since YE2025 (after returning capital), and capital actions including a $0.18 regular quarterly dividend, a $2.00 special dividend (~$200M returned), a $250M repurchase authorization (≈235k shares bought at $51.25 avg; ~$238M remaining). Management also noted reinsurance renewals were generally flat-to-down on price, and that continued higher investment income is expected if rates hold; they reiterated a revised operating earnings definition (excludes equity in unconsolidated investees).RLI Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
83
Very Positive
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.97B | 1.88B | 1.77B | 1.51B | 1.70B | 1.18B |
| Gross Profit | 937.71M | 561.42M | 454.63M | 390.87M | 731.77M | 459.60M |
| EBITDA | 570.29M | 530.45M | 441.55M | 393.11M | 736.71M | 359.39M |
| Net Income | 438.70M | 403.34M | 345.78M | 304.61M | 583.41M | 279.35M |
Balance Sheet | ||||||
| Total Assets | 6.41B | 6.16B | 5.63B | 5.18B | 4.77B | 4.51B |
| Cash, Cash Equivalents and Short-Term Investments | 238.22M | 1.69B | 3.29B | 3.03B | 2.73B | 2.50B |
| Total Debt | 296.97M | 100.00M | 100.00M | 200.00M | 399.73M | 199.68M |
| Total Liabilities | 4.66B | 4.38B | 4.11B | 3.77B | 3.59B | 3.28B |
| Stockholders Equity | 1.75B | 1.78B | 1.52B | 1.41B | 1.18B | 1.23B |
Cash Flow | ||||||
| Free Cash Flow | 517.02M | 608.70M | 555.51M | 458.34M | 244.56M | 376.60M |
| Operating Cash Flow | 524.04M | 614.22M | 560.22M | 464.26M | 250.45M | 384.90M |
| Investing Cash Flow | -272.66M | -362.13M | -318.87M | -211.80M | 48.88M | -274.83M |
| Financing Cash Flow | -240.69M | -240.32M | -237.98M | -238.85M | -365.31M | -83.49M |
RLI Technical Analysis
Positive
61.92
Price Trends
57.81
Positive
55.11
Positive
56.74
Positive
Market Momentum
1.50
Positive
61.32
Neutral
56.38
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RLI, the sentiment is Positive. The current price of 61.92 is above the 20-day moving average (MA) of 61.83, above the 50-day MA of 57.81, and above the 200-day MA of 56.74, indicating a bullish trend. The MACD of 1.50 indicates Positive momentum. The RSI at 61.32 is Neutral, neither overbought nor oversold. The STOCH value of 56.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RLI.
RLI Risk Analysis
RLI disclosed 28 risk factors in its most recent earnings report. RLI reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
RLI Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $5.89B | 13.49 | 24.37% | 4.08% | 10.29% | 35.39% | |
79 Outperform | $5.13B | 4.89 | 20.61% | 0.05% | 11.98% | 445.91% | |
78 Outperform | $5.73B | 11.91 | 13.87% | 1.80% | 7.30% | 32.16% | |
76 Outperform | $7.98B | 10.79 | 21.22% | 1.72% | 5.57% | 38.39% | |
74 Outperform | $6.07B | 6.47 | 37.19% | 1.18% | 9.95% | 140.12% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
55 Neutral | $1.68B | -3.39 | 1.52% | 4.44% | -3.92% | -256.50% |
* Financial Sector Average
RLI
RLI
64.23
3.10
5.07%
MCY
Mercury General
109.50
38.96
55.23%
SIGI
Selective Insurance Group
96.23
20.18
26.54%
THG
Hanover Insurance
229.08
63.19
38.09%
KMPR
Kemper
28.51
-20.66
-42.02%
WTM
White Mountains Insurance Group
2,149.44
366.74
20.57%
RLI Corporate Events
Business Operations and StrategyExecutive/Board Changes
RLI Board Member Michael Angelina to Resign
Neutral
Jun 25, 2026
On June 22, 2026, RLI Corp. announced that board member Michael Angelina had notified the company of his decision to resign from its Board of Directors, effective June 30, 2026. His departure is driven by his intention to explore joining the board...
Executive/Board ChangesShareholder Meetings
RLI Shareholders Back Board, Name New Chairman
Positive
May 20, 2026
RLI Corp. held its annual meeting of shareholders on May 14, 2026, where investors elected all nominated directors to one-year terms and the board subsequently appointed director David B. Duclos as chairman, signaling continuity in governance and ...
Stock BuybackDividends
RLI Boosts Dividend and Authorizes New Share Repurchase
Positive
May 14, 2026
On May 14, 2026, RLI Corp. announced that its board declared a special cash dividend of $2.00 per share, totaling about $184 million, alongside a 12.5% increase in its regular quarterly dividend to $0.18 per share, both payable on June 12, 2026 to...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.