NYSE:RLI

Stock Analysis Report

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Executive Summary

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


Snowflake Analysis

Adequate balance sheet average dividend payer.


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

Stable Share Price: RLI is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: RLI's weekly volatility (4%) has been stable over the past year.


Market Performance


7 Day Return

4.6%

RLI

3.1%

US Insurance

-0.4%

US Market


1 Year Return

33.3%

RLI

14.8%

US Insurance

36.2%

US Market

Return vs Industry: RLI exceeded the US Insurance industry which returned 14.7% over the past year.

Return vs Market: RLI underperformed the US Market which returned 36.3% over the past year.


Shareholder returns

RLIIndustryMarket
7 Day4.6%3.1%-0.4%
30 Day9.5%6.4%-2.3%
90 Day10.0%8.4%5.0%
1 Year36.0%33.3%17.9%14.8%39.1%36.2%
3 Year82.1%70.5%22.1%13.0%48.4%39.0%
5 Year94.4%66.8%74.3%52.6%116.6%92.4%

Long-Term 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 compared to its fair value and its price relative to the market?

31.26x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: RLI ($109.13) is trading above our estimate of fair value ($65.61)

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


Price To Earnings Ratio

PE vs Industry: RLI is poor value based on its PE Ratio (31.3x) compared to the US Insurance industry average (14.8x).

PE vs Market: RLI is poor value based on its PE Ratio (31.3x) compared to the US market (21.5x).


Price to Earnings Growth Ratio

PEG Ratio: RLI is poor value based on its PEG Ratio (15.1x)


Price to Book Ratio

PB vs Industry: RLI is overvalued based on its PB Ratio (4.3x) compared to the US Insurance industry average (1x).


Next Steps

Future Growth

How is RLI forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

2.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RLI's forecast earnings growth (2.1% per year) is above the savings rate (2%).

Earnings vs Market: RLI's earnings (2.1% per year) are forecast to grow slower than the US market (19.3% per year).

High Growth Earnings: RLI's earnings are forecast to grow, but not significantly.

Revenue vs Market: RLI's revenue (4.7% per year) is forecast to grow slower than the US market (10% per year).

High Growth Revenue: RLI's revenue (4.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RLI's Return on Equity is forecast to be low in 3 years time (16.3%).


Next Steps

Past Performance

How has RLI performed over the past 5 years?

1.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RLI has high quality earnings.

Growing Profit Margin: RLI's current net profit margins (16%) are lower than last year (19%).


Past Earnings Growth Analysis

Earnings Trend: RLI's earnings have grown by 1.4% per year over the past 5 years.

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

Earnings vs Industry: RLI had negative earnings growth (-17.4%) over the past year, making it difficult to compare to the Insurance industry average (-12.7%).


Return on Equity

High ROE: RLI's Return on Equity (13.8%) is considered low.


Next Steps

Financial Health

How is RLI's financial position?


Financial Position Analysis

Short Term Liabilities: RLI's short term assets ($696.7M) do not cover its short term liabilities ($1.2B).

Long Term Liabilities: RLI's short term assets ($696.7M) do not cover its long term liabilities ($1.6B).


Debt to Equity History and Analysis

Debt Level: RLI's debt to equity ratio (13.2%) is considered satisfactory.

Reducing Debt: RLI's debt to equity ratio has reduced from 18% to 13.2% over the past 5 years.

Debt Coverage: RLI's debt is well covered by operating cash flow (176.1%).

Interest Coverage: RLI's interest payments on its debt are well covered by EBIT (23.3x coverage).


Balance Sheet


Next Steps

Dividend

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

1.80%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RLI's dividend (1.8%) is higher than the bottom 25% of dividend payers in the US market (1.31%).

High Dividend: RLI's dividend (1.8%) is low compared to the top 25% of dividend payers in the US market (3.64%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (27.2%), RLI's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RLI's dividends in 3 years are forecast to be covered by earnings (85% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.7yrs

Average management tenure


CEO

Jon Michael (67 yo)

20.17yrs

Tenure

US$4,714,007

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 ($USD4.71M) is about average for companies of similar size in the US market ($USD6.41M).

Compensation vs Earnings: Jon's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Jonathan Michael
CEO & Chairman20.17yrsUS$4.71m2.57%
$ 126.8m
Craig Kliethermes
President0.17yrUS$3.07m0.25%
$ 12.6m
Todd Bryant
VP & CFO1.67yrsUS$866.84k0.10%
$ 5.1m
Jeffrey Fick
Senior VP4.42yrsUS$854.52k0.15%
$ 7.6m
Jennifer Klobnak
Senior Vice President of Operationsno dataUS$1.64m0.078%
$ 3.8m
Aaron Diefenthaler
VP, Chief Investment Officer & Treasurer9.17yrsno data0.053%
$ 2.6m
Kathleen Taylor
Vice President of Accounting & Branch Operations2.17yrsno datano data
Bryan Fowler
VP & Chief Information Officer3.5yrsno datano data
Lisa Gates
Vice President of Marketing & Communications2.17yrsno datano data
Kathleen Kappes
Vice President of Human Resourcesno datano datano data
Paul Simoneau
Senior Vice President of E&S Lines7.83yrsno datano data
Betsy McLaughlin
VP & Chief Claim Counsel3.92yrsno datano data

3.7yrs

Average Tenure

53yo

Average Age

Experienced Management: RLI's management team is considered experienced (3.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Jonathan Michael
CEO & Chairman20.17yrsUS$4.71m2.57%
$ 126.8m
Craig Kliethermes
President0.17yrUS$3.07m0.25%
$ 12.6m
Michael Stone
Independent Director8.58yrsUS$155.63k0.53%
$ 26.0m
Kaj Ahlmann
Independent Director12.08yrsUS$155.01k0.0032%
$ 157.2k
Robert Restrepo
Independent Director4.67yrsUS$150.01k0.023%
$ 1.1m
Jordan Graham
Independent Director16.33yrsUS$160.01k0.013%
$ 635.1k
John Baily
Independent Lead Directorno dataUS$172.82k0.080%
$ 4.0m
David Duclos
Independent Director3.83yrsUS$170.01k0.0044%
$ 216.3k
Michael Angelina
Independent Director7.25yrsUS$170.63k0.024%
$ 1.2m
Calvin Butler
Independent Director4.42yrsUS$155.01k0.019%
$ 932.7k
Susan Fleming
Independent Director2.58yrsUS$150.01k0.0029%
$ 144.9k
Debbie Roberts
Independent Director2.58yrsUS$152.20k0.0095%
$ 469.1k

4.7yrs

Average Tenure

60.5yo

Average Age

Experienced Board: RLI's board of directors are considered experienced (4.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: RLI insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

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


Key Information

  • Name: RLI Corp.
  • Ticker: RLI
  • Exchange: NYSE
  • Founded: 2017
  • Industry: Property and Casualty Insurance
  • Sector: Insurance
  • Market Cap: US$4.927b
  • Shares outstanding: 45.15m
  • 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 Analysis2021/03/06 23:19
End of Day Share Price2021/03/05 00:00
Earnings2020/12/31
Annual Earnings2020/12/31


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.