DB:RL1

Stock Analysis Report

Executive Summary

RLI Corp., an insurance holding company, underwrites property and casualty insurance in the United States and internationally.

Snowflake

Fundamentals

Second-rate dividend payer with concerning outlook.


Similar Companies

Share Price & News

How has RLI's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

7.3%

RL1

2.6%

DE Insurance

1.7%

DE Market


1 Year Return

45.6%

RL1

23.6%

DE Insurance

7.2%

DE Market

Return vs Industry: RL1 exceeded the German Insurance industry which returned 23.6% over the past year.

Return vs Market: RL1 exceeded the German Market which returned 7.2% over the past year.


Shareholder returns

RL1IndustryMarket
7 Day7.3%2.6%1.7%
30 Day5.8%3.9%2.4%
90 Day11.8%3.9%2.3%
1 Year49.3%45.6%29.0%23.6%10.6%7.2%
3 Year87.5%67.2%69.7%49.2%18.4%8.1%
5 Yearn/a119.2%75.5%42.3%22.9%

Price Volatility Vs. Market

How volatile is RLI's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is RLI undervalued compared to its fair value and its price relative to the market?

36.72x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: RL1 (€88.5) is trading above our estimate of fair value (€49.75)

Significantly Below Fair Value: RL1 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: RL1 is poor value based on its PE Ratio (36.7x) compared to the Insurance industry average (13.4x).

PE vs Market: RL1 is poor value based on its PE Ratio (36.7x) compared to the German market (19x).


Price to Earnings Growth Ratio

PEG Ratio: RL1's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: RL1 is overvalued based on its PB Ratio (4.3x) compared to the DE Insurance industry average (1.1x).


Next Steps

Future Growth

How is RLI forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

-11.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RL1's earnings are forecast to decline over the next 3 years (-11.1% per year).

Earnings vs Market: RL1's earnings are forecast to decline over the next 3 years (-11.1% per year).

High Growth Earnings: RL1's earnings are forecast to decline over the next 3 years.

Revenue vs Market: RL1's revenue (6.4% per year) is forecast to grow faster than the German market (5% per year).

High Growth Revenue: RL1's revenue (6.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RL1's Return on Equity is forecast to be low in 3 years time (12%).


Next Steps

Past Performance

How has RLI performed over the past 5 years?

-6.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: RL1's earnings have declined by -6.2% per year over the past 5 years.

Accelerating Growth: RL1's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: RL1 had negative earnings growth (-17.2%) over the past year, making it difficult to compare to the Insurance industry average (15.2%).


Return on Equity

High ROE: RL1's Return on Equity (11.8%) is considered low.


Return on Assets

ROA vs Industry: RL1 has a higher Return on Assets than the Insurance industry average last year.


Return on Capital Employed

ROCE Improving: RL1's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is RLI's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: RL1 has a low level of unsold assets or inventory.

Debt Coverage by Assets: RL1's debt is covered by short term assets (assets are 4.964500x debt).


Financial Institutions Analysis

Asset Level: RL1's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if RL1 has a sufficient allowance for bad loans.

Low Risk Liabilities: RL1 reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if RL1 has an acceptable proportion of non-loan assets held.

Low Risk Deposits: RL1 has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if RL1 has an appropriate level of bad loans.


Next Steps

Dividend

What is RLI's current dividend yield, its reliability and sustainability?

1.99%

Current Dividend Yield


Dividend Yield vs Market

company2.0%marketbottom25%1.5%markettop25%3.8%industryaverage3.9%forecastin3Years2.5%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: RL1's dividend (1.99%) is higher than the bottom 25% of dividend payers in the German market (1.48%).

High Dividend: RL1's dividend (1.99%) is low compared to the top 25% of dividend payers in the German market (3.83%).

Stable Dividend: RL1's dividend payments have been volatile in the past 10 years.

Growing Dividend: RL1's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (34.2%), RL1's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RL1's dividends in 3 years are not forecast to be well covered by earnings (96.1% payout ratio).


Next Steps

Management

What is the CEO of RLI's salary, the management and board of directors tenure and is there insider trading?

2.1yrs

Average management tenure


CEO

Jon Michael (66yo)

18.8yrs

Tenure

US$3,212,994

Compensation

Mr. Jonathan Edward Michael, also known as Jon, has been Chairman of the Board of RLI Corp. since May 5, 2011 and has been its Chief Executive Officer since January 1, 2001. He served as President of RLI C ...


CEO Compensation Analysis

Compensation vs. Market: Jon's total compensation ($USD3.21M) is about average for companies of similar size in the German market ($USD2.95M).

Compensation vs Earnings: Jon's compensation has been consistent with company performance over the past year.


Management Age and Tenure

2.1yrs

Average Tenure

52yo

Average Age

Experienced Management: RL1's management team is considered experienced (2.1 years average tenure).


Board Age and Tenure

5.8yrs

Average Tenure

63.5yo

Average Age

Experienced Board: RL1's board of directors are considered experienced (5.8 years average tenure).


Insider Trading

Insider Buying: RL1 insiders have sold more shares than they have bought in the past 3 months.


Recent Insider Transactions

SellUS$121,52201 Oct 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,433
Max PriceUS$84.80
SellUS$417,14130 Aug 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares5,000
Max PriceUS$83.43
BuyUS$82,08329 Aug 19
Michael Angelina
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,000
Max PriceUS$82.08
SellUS$1,239,16001 Aug 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares15,000
Max PriceUS$82.61
SellUS$108,42802 Jul 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,433
Max PriceUS$75.66
SellUS$1,061,29724 Apr 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares15,000
Max PriceUS$70.88
SellUS$91,67702 Apr 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,437
Max PriceUS$63.80
SellUS$618,51601 Mar 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares10,000
Max PriceUS$61.96
SellUS$572,85330 Jan 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares10,000
Max PriceUS$57.29
SellUS$90,55004 Jan 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,540
Max PriceUS$58.80

Ownership Breakdown


Management Team

  • Jeff Fick (58yo)

    Senior VP & Chief Legal Officer

    • Tenure: 3yrs
    • Compensation: US$640.11k
  • Jon Michael (66yo)

    Chairman & CEO

    • Tenure: 18.8yrs
    • Compensation: US$3.21m
  • Craig Kliethermes (54yo)

    President & COO

    • Tenure: 0yrs
    • Compensation: US$1.86m
  • Todd Bryant (50yo)

    VP & CFO

    • Tenure: 0.3yrs
  • Lisa Gates

    Vice President of Marketing & Communications

    • Tenure: 0.8yrs
  • Aaron Diefenthaler (45yo)

    VP, Chief Investment Officer & Treasurer

    • Tenure: 7.8yrs
  • Jennifer Klobnak (47yo)

    Senior Vice President of Operations

    • Tenure: 0yrs
    • Compensation: US$822.59k
  • Katie Kappes

    Vice President of Human Resources

    • Tenure: 0yrs
  • Bryan Fowler

    VP & Chief Information Officer

    • Tenure: 2.1yrs
  • Kathleen Taylor

    Vice President - Accounting Operations

    • Tenure: 0.8yrs

Board Members

  • Jon Michael (66yo)

    Chairman & CEO

    • Tenure: 18.8yrs
    • Compensation: US$3.21m
  • Mike Stone (70yo)

    Director

    • Tenure: 7.2yrs
    • Compensation: US$150.00k
  • Kaj Ahlmann (68yo)

    Independent Director

    • Tenure: 10.7yrs
    • Compensation: US$155.00k
  • Bob Restrepo (68yo)

    Director

    • Tenure: 3.3yrs
    • Compensation: US$150.00k
  • Jordan Graham (58yo)

    Independent Director

    • Tenure: 14.9yrs
    • Compensation: US$160.00k
  • John Baily (75yo)

    Lead Director

    • Tenure: 0yrs
    • Compensation: US$170.00k
  • Dave Duclos (61yo)

    Independent Director

    • Tenure: 2.4yrs
    • Compensation: US$163.18k
  • Mike Angelina (52yo)

    Independent Director

    • Tenure: 5.8yrs
    • Compensation: US$165.00k
  • Calvin Butler (49yo)

    Director

    • Tenure: 3yrs
    • Compensation: US$155.00k
  • Susan Fleming (48yo)

    Director

    • Tenure: 1.2yrs
    • Compensation: US$88.15k

Company Information

RLI Corp.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: RLI Corp.
  • Ticker: RL1
  • Exchange: DB
  • Founded: 1965
  • Industry: Property and Casualty Insurance
  • Sector: Insurance
  • Market Cap: US$4.421b
  • Listing Market Cap: US$3.968b
  • Shares outstanding: 44.83m
  • Website: https://www.rlicorp.com

Number of Employees


Location

  • RLI Corp.
  • 9025 North Lindbergh Drive
  • Peoria
  • Illinois
  • 61615
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RLINYSE (New York Stock Exchange)YesCommon StockUSUSDDec 1972
RL1DB (Deutsche Boerse AG)YesCommon StockDEEURDec 1972

Biography

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 g ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/22 21:44
End of Day Share Price2019/10/22 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.