Last Updated: 14 Sep 2024
Executive Summary
RLI Corp. (RLI) is a leading specialty insurance company with a market capitalization of $6.94 billion. The company's strong financial performance, including an EBITDA of $426.44 million, EPS of $7.33, and a dividend yield of 0.77%, makes it an attractive investment for both short-term and long-term investors. RLI's analyst target price of $166.25 and a consensus analyst rating of "Hold" suggest that the stock is currently fairly valued.
Company Overview
RLI Corp. is headquartered in Peoria, Illinois, and provides specialty insurance products and services to a diverse range of clients. The company's products include property and casualty insurance, surety bonds, and workers' compensation insurance. RLI operates through a network of independent agents and brokers in the United States and internationally.
Fundamental Analysis
RLI's financial performance has been consistently strong in recent years. The company's revenue has grown by an average of 9.1% annually over the past five years, and its EPS has grown by an average of 12.5% annually. RLI's profit margin of 20.8% and return on equity of 23% are both above industry averages.
The company's strong financial performance is supported by its conservative underwriting practices and disciplined expense management. RLI has a combined ratio of 97.2%, which is below the industry average. The company also has a strong balance sheet with a debt-to-equity ratio of 0.33.
Technical Analysis
RLI's stock price has been trending higher in recent months. The stock is currently trading above its 50-day and 200-day moving averages, which is a bullish technical indicator. The stock's relative strength index (RSI) is also in bullish territory, suggesting that the stock is not overbought.
Short Term Outlook
RLI's stock is expected to continue to perform well in the short term. The company's strong financial performance and positive technical indicators suggest that the stock is likely to continue to trend higher. The stock's analyst target price of $166.25 provides a potential upside of 9.6% from the current price.
Long Term Outlook
RLI's long-term outlook is also positive. The company's strong competitive position in the specialty insurance market and its disciplined underwriting practices should continue to drive growth in the years to come. The company's stock is expected to continue to outperform the broader market over the long term.
Analyst Recommendations
Analysts have a consensus rating of "Hold" on RLI's stock. Two analysts have a "Strong Buy" rating, one has a "Buy" rating, and five have a "Hold" rating. The average analyst target price is $166.25.
