RLI CORP (RLI) Stock Fundamental Analysis
NYSE:RLI - New York Stock Exchange, Inc. - US7496071074 - Common Stock - Currency: USD
Overall RLI gets a fundamental rating of 5 out of 10. We evaluated RLI against 143 industry peers in the Insurance industry. While RLI has a great profitability rating, there are some minor concerns on its financial health. While showing a medium growth rate, RLI is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year RLI was profitable.
In the past year RLI had a positive cash flow from operations.
In the past 5 years RLI has always been profitable.
RLI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 6.14%, RLI belongs to the top of the industry, outperforming 91.61% of the companies in the same industry.
Looking at the Return On Equity, with a value of 22.72%, RLI belongs to the top of the industry, outperforming 91.61% of the companies in the same industry.
The Return On Invested Capital of RLI (5.90%) is better than 86.01% of its industry peers.
The Average Return On Invested Capital over the past 3 years for RLI is above the industry average of 4.23%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.14% | ||
| ROE | 22.72% | ||
| ROIC | 5.9% |
ROA(3y)8.09%
ROA(5y)6.89%
ROE(3y)31.27%
ROE(5y)26.07%
ROIC(3y)8.57%
ROIC(5y)7.05%
1.3 Margins
RLI's Profit Margin of 20.04% is amongst the best of the industry. RLI outperforms 88.81% of its industry peers.
In the last couple of years the Profit Margin of RLI has remained more or less at the same level.
Looking at the Operating Margin, with a value of 22.81%, RLI belongs to the top of the industry, outperforming 85.31% of the companies in the same industry.
In the last couple of years the Operating Margin of RLI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.81% | ||
| PM (TTM) | 20.04% | ||
| GM | N/A |
OM growth 3Y-2.46%
OM growth 5Y2.54%
PM growth 3Y-6.23%
PM growth 5Y0.45%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), RLI is destroying value.
RLI has more shares outstanding than it did 1 year ago.
RLI has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, RLI has an improved debt to assets ratio.
2.2 Solvency
There is no outstanding debt for RLI. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.18 | ||
| Altman-Z | N/A |
ROIC/WACC0.65
WACC9.02%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
RLI shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.42%, which is quite good.
RLI shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 17.43% yearly.
RLI shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 12.07%.
Measured over the past years, RLI shows a quite strong growth in Revenue. The Revenue has been growing by 12.02% on average per year.
EPS 1Y (TTM)9.42%
EPS 3Y14.04%
EPS 5Y17.43%
EPS Q2Q%-2.65%
Revenue 1Y (TTM)12.07%
Revenue growth 3Y14.5%
Revenue growth 5Y12.02%
Sales Q2Q%5.15%
3.2 Future
RLI is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 2.66% yearly.
The Revenue is expected to grow by 3.44% on average over the next years.
EPS Next Y7.53%
EPS Next 2Y5.49%
EPS Next 3Y2.66%
EPS Next 5YN/A
Revenue Next Year5.37%
Revenue Next 2Y5.67%
Revenue Next 3Y3.44%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 25.86, RLI can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of RLI indicates a slightly more expensive valuation: RLI is more expensive than 72.03% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 24.85, RLI is valued at the same level.
The Price/Forward Earnings ratio is 23.08, which indicates a rather expensive current valuation of RLI.
73.43% of the companies in the same industry are cheaper than RLI, based on the Price/Forward Earnings ratio.
RLI is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 20.89, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.86 | ||
| Fwd PE | 23.08 |
4.2 Price Multiples
RLI's Enterprise Value to EBITDA ratio is in line with the industry average.
RLI's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.18 | ||
| EV/EBITDA | 17.16 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates RLI does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of RLI may justify a higher PE ratio.
PEG (NY)3.43
PEG (5Y)1.48
EPS Next 2Y5.49%
EPS Next 3Y2.66%
5. Dividend
5.1 Amount
RLI has a yearly dividend return of 0.81%, which is pretty low.
RLI's Dividend Yield is slightly below the industry average, which is at 3.19.
Compared to an average S&P500 Dividend Yield of 2.40, RLI's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
5.2 History
On average, the dividend of RLI grows each year by 12.36%, which is quite nice.
RLI has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of RLI decreased recently.
Dividend Growth(5Y)12.36%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
RLI pays out 68.15% of its income as dividend. This is not a sustainable payout ratio.
RLI's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP68.15%
EPS Next 2Y5.49%
EPS Next 3Y2.66%
73.7
-0.66 (-0.89%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners81.94%
Inst Owner Change36.18%
Ins Owners0.85%
Ins Owner Change1.34%
Market Cap6.76B
Analysts67.69
Price Target78.8 (6.92%)
Short Float %1.61%
Short Ratio3.26
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
Yearly Dividend3.43
Dividend Growth(5Y)12.36%
DP68.15%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)5.64%
Min EPS beat(2)-21.72%
Max EPS beat(2)33%
EPS beat(4)3
Avg EPS beat(4)13.87%
Min EPS beat(4)-21.72%
Max EPS beat(4)33%
EPS beat(8)6
Avg EPS beat(8)87.04%
EPS beat(12)9
Avg EPS beat(12)66.49%
EPS beat(16)13
Avg EPS beat(16)58.25%
Revenue beat(2)1
Avg Revenue beat(2)-1.77%
Min Revenue beat(2)-5.61%
Max Revenue beat(2)2.08%
Revenue beat(4)3
Avg Revenue beat(4)0.19%
Min Revenue beat(4)-5.61%
Max Revenue beat(4)2.64%
Revenue beat(8)5
Avg Revenue beat(8)0.02%
Revenue beat(12)8
Avg Revenue beat(12)12.78%
Revenue beat(16)11
Avg Revenue beat(16)13.98%
PT rev (1m)-5.56%
PT rev (3m)-5.56%
EPS NQ rev (1m)-1.13%
EPS NQ rev (3m)-2.07%
EPS NY rev (1m)-0.6%
EPS NY rev (3m)-0.6%
Revenue NQ rev (1m)-2.93%
Revenue NQ rev (3m)0.27%
Revenue NY rev (1m)-1.14%
Revenue NY rev (3m)0.58%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.86 | ||
| Fwd PE | 23.08 | ||
| P/S | 3.92 | ||
| P/FCF | 12.18 | ||
| P/OCF | 12.07 | ||
| P/B | 4.44 | ||
| P/tB | 4.61 | ||
| EV/EBITDA | 17.16 |
EPS(TTM)2.85
EY3.87%
EPS(NY)3.19
Fwd EY4.33%
FCF(TTM)6.05
FCFY8.21%
OCF(TTM)6.1
OCFY8.28%
SpS18.8
BVpS16.58
TBVpS16
PEG (NY)3.43
PEG (5Y)1.48
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.14% | ||
| ROE | 22.72% | ||
| ROCE | 7.3% | ||
| ROIC | 5.9% | ||
| ROICexc | 5.94% | ||
| ROICexgc | 7.35% | ||
| OM | 22.81% | ||
| PM (TTM) | 20.04% | ||
| GM | N/A | ||
| FCFM | 32.2% |
ROA(3y)8.09%
ROA(5y)6.89%
ROE(3y)31.27%
ROE(5y)26.07%
ROIC(3y)8.57%
ROIC(5y)7.05%
ROICexc(3y)8.63%
ROICexc(5y)7.12%
ROICexgc(3y)10.98%
ROICexgc(5y)8.97%
ROCE(3y)10.61%
ROCE(5y)8.72%
ROICexcg growth 3Y3.78%
ROICexcg growth 5Y5.67%
ROICexc growth 3Y3.88%
ROICexc growth 5Y4.97%
OM growth 3Y-2.46%
OM growth 5Y2.54%
PM growth 3Y-6.23%
PM growth 5Y0.45%
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.18 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 61.46% | ||
| Cap/Sales | 0.27% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 139.67% | ||
| Profit Quality | 160.65% | ||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z | N/A |
F-Score7
WACC9.02%
ROIC/WACC0.65
Cap/Depr(3y)68.15%
Cap/Depr(5y)78.89%
Cap/Sales(3y)0.33%
Cap/Sales(5y)0.46%
Profit Quality(3y)117.68%
Profit Quality(5y)130.35%
High Growth Momentum
Growth
EPS 1Y (TTM)9.42%
EPS 3Y14.04%
EPS 5Y17.43%
EPS Q2Q%-2.65%
EPS Next Y7.53%
EPS Next 2Y5.49%
EPS Next 3Y2.66%
EPS Next 5YN/A
Revenue 1Y (TTM)12.07%
Revenue growth 3Y14.5%
Revenue growth 5Y12.02%
Sales Q2Q%5.15%
Revenue Next Year5.37%
Revenue Next 2Y5.67%
Revenue Next 3Y3.44%
Revenue Next 5YN/A
EBIT growth 1Y4.93%
EBIT growth 3Y11.69%
EBIT growth 5Y14.87%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y21.2%
FCF growth 3Y13.83%
FCF growth 5Y15.53%
OCF growth 1Y20.67%
OCF growth 3Y13.33%
OCF growth 5Y15.13%