NYSE:RLI

Stock Analysis Report

Executive Summary

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

Snowflake

Fundamentals

Excellent balance sheet with acceptable track record.


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

-0.3%

NYSE:RLI

-1.5%

US Insurance

-1.0%

US Market


1 Year Return

18.6%

NYSE:RLI

8.4%

US Insurance

-0.4%

US Market

RLI outperformed the Insurance industry which returned 7.2% over the past year.

RLI outperformed the Market in United States of America which returned -1.7% over the past year.


Share holder returns

RLIIndustryMarket
7 Day-0.3%-1.5%-1.0%
30 Day5.5%-2.9%-3.3%
90 Day9.4%2.4%0.4%
1 Year21.5%18.6%11.0%8.4%1.8%-0.4%
3 Year48.7%32.8%44.7%33.8%39.4%30.4%
5 Year156.3%102.7%66.5%46.8%54.2%37.1%

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

Valuation

Is RLI undervalued based on future cash flows and its price relative to the stock market?

32.9x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

RLI's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).

RLI's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).


Price Based on Earnings

RLI is overvalued based on earnings compared to the US Insurance industry average.

RLI is overvalued based on earnings compared to the United States of America market.


Price Based on Expected Growth

RLI earnings are not expected to grow next year, we can't assess if its growth is good value.


Price Based on Value of Assets

RLI is overvalued based on assets compared to the US Insurance industry average.


Next Steps

Future Growth

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

-10.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

RLI's revenue is expected to grow by 2.5% yearly, however this is not considered high growth (20% yearly).

RLI's earnings are expected to decrease over the next 1-3 years, this is not considered high growth.

RLI's revenue growth is positive but not above the United States of America market average.

RLI's earnings are expected to decrease over the next 1-3 years, this is below the United States of America market average.

RLI's earnings are expected to decrease over the next 1-3 years, this is below the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

RLI is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).


Next Steps

Past Performance

How has RLI performed over the past 5 years?

-6.9%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

RLI's year on year earnings growth rate was negative over the past 5 years, however the most recent earnings are above average.

RLI's 1-year earnings growth exceeds its 5-year average (19.3% vs -6.9%)

RLI's earnings growth has exceeded the US Insurance industry average in the past year (19.3% vs 4.3%).


Return on Equity

RLI has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

RLI used its assets more efficiently than the US Insurance industry average last year based on Return on Assets.


Return on Capital Employed

RLI's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is RLI's financial position?


Financial Position Analysis

RLI is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

RLI's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

RLI's level of debt (15.5%) compared to net worth is satisfactory (less than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (16.3% vs 15.5% today).

Debt is well covered by operating cash flow (149.1%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 18x coverage).


Balance Sheet

Low level of unsold assets.

Debt is covered by short term assets, assets are 4.1x debt.


Next Steps

Dividend

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

2.86%

Expected Dividend Yield


Dividend Yield and Payments Analysis

RLI's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.5%).

RLI's dividend is below the markets top 25% of dividend payers in United States of America (3.9%).

Dividends per share have been volatile in the past 10 years (annual drop of over 20%).

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (3.1x coverage).


Future Payout to Shareholders

Dividends after 3 years are not well covered by earnings (1x coverage).


Next Steps

Management

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

2.4yrs

Average management tenure


CEO

Jon Michael (66yo)

18.6yrs

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

Jon's remuneration is lower than average for companies of similar size in United States of America.

Jon's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

2.4yrs

Average Tenure

50yo

Average Age

The tenure for the RLI management team is about average.


Board Age and Tenure

5.7yrs

Average Tenure

63.5yo

Average Age

The tenure for the RLI board of directors is about average.


Insider Trading

RLI individual insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$1,379,14401 Aug 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Shares15,000
Max PriceUS$91.94
SellUS$122,68302 Jul 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Shares1,433
Max PriceUS$85.61
SellUS$1,187,79824 Apr 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Shares15,000
Max PriceUS$79.33
SellUS$102,82302 Apr 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Shares1,437
Max PriceUS$71.55
SellUS$704,38001 Mar 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Shares10,000
Max PriceUS$70.56
SellUS$654,24030 Jan 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Shares10,000
Max PriceUS$65.43
SellUS$103,28504 Jan 19
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Shares1,540
Max PriceUS$67.07
SellUS$110,39001 Oct 18
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Shares1,422
Max PriceUS$77.63
SellUS$389,20006 Sep 18
Michael Stone
EntityIndividual
Role
Member of the Board of Directors
Shares5,000
Max PriceUS$77.84

Ownership Breakdown


Management Team

  • Jon Michael (66yo)

    Chairman & CEO

    • Tenure: 18.6yrs
    • Compensation: $3.21m
  • Craig Kliethermes (54yo)

    President & COO

    • Compensation: $1.86m
  • Lisa Gates

    Vice President of Marketing & Communications

    • Tenure: 0.6yrs
  • Jennifer Klobnak (47yo)

    Senior Vice President of Operations

    • Compensation: $822.59k
  • Bryan Fowler

    VP & Chief Information Officer

    • Tenure: 1.9yrs
  • Aaron Jacoby (48yo)

    Vice President of Corporate Development

    • Tenure: 16.6yrs
  • Todd Bryant (50yo)

    VP & CFO

    • Tenure: 0.1yrs
  • Jeff Fick (58yo)

    Senior VP & Chief Legal Officer

    • Tenure: 2.8yrs
    • Compensation: $640.11k
  • Aaron Diefenthaler (45yo)

    VP, Chief Investment Officer & Treasurer

    • Tenure: 7.6yrs
  • Kathleen Taylor

    Vice President - Accounting Operations

    • Tenure: 0.6yrs

Board Members

  • Jon Michael (66yo)

    Chairman & CEO

    • Tenure: 8.3yrs
    • Compensation: $3.21m
  • Bob Restrepo (68yo)

    Director

    • Tenure: 3.1yrs
    • Compensation: $150.00k
  • Dave Duclos (61yo)

    Director

    • Tenure: 2.3yrs
    • Compensation: $163.18k
  • Mike Angelina (52yo)

    Director

    • Tenure: 5.7yrs
    • Compensation: $165.00k
  • John Baily (75yo)

    Lead Director

    • Compensation: $170.00k
  • Susan Fleming (48yo)

    Director

    • Tenure: 1.0yrs
    • Compensation: $88.15k
  • Kaj Ahlmann (68yo)

    Director

    • Tenure: 10.5yrs
    • Compensation: $155.00k
  • Mike Stone (70yo)

    Director

    • Tenure: 7.0yrs
    • Compensation: $150.00k
  • Jordan Graham (58yo)

    Director

    • Tenure: 14.8yrs
    • Compensation: $160.00k
  • Calvin Butler (49yo)

    Director

    • Tenure: 2.8yrs
    • Compensation: $155.00k

Company Information

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


Key Information

  • Name: RLI Corp.
  • Ticker: RLI
  • Exchange: NYSE
  • Founded: 1965
  • Industry: property and casualty insurance
  • Sector: insurance
  • Market Cap: US$4.124b
  • Shares outstanding: 44.79m
  • Website: Click here

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 Analysis2019/08/16 23:44
End of Day Share Price2019/08/16 00:00
Earnings2019/06/30
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.