RLI CORP (RLI) Stock Fundamental Analysis
NYSE:RLI - New York Stock Exchange, Inc. - US7496071074 - Common Stock - Currency: USD
Taking everything into account, RLI scores 5 out of 10 in our fundamental rating. RLI was compared to 143 industry peers in the Insurance industry. RLI has an excellent profitability rating, but 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.
Each year in the past 5 years RLI has been profitable.
Each year in the past 5 years RLI had a positive operating cash flow.
1.2 Ratios
RLI's Return On Assets of 6.14% is amongst the best of the industry. RLI outperforms 91.61% of its industry peers.
With an excellent Return On Equity value of 22.72%, RLI belongs to the best of the industry, outperforming 91.61% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 5.90%, RLI belongs to the top of the industry, outperforming 87.41% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for RLI is above the industry average of 4.13%.
| 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
The Profit Margin of RLI (20.04%) is better than 88.11% of its industry peers.
RLI's Profit Margin has been stable in the last couple of years.
RLI has a better Operating Margin (22.81%) than 86.01% of its industry peers.
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so RLI is destroying value.
The number of shares outstanding for RLI has been increased compared to 1 year ago.
The number of shares outstanding for RLI has been increased compared to 5 years ago.
Compared to 1 year ago, RLI has an improved debt to assets ratio.
2.2 Solvency
RLI has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.18 | ||
| Altman-Z | N/A |
ROIC/WACC0.66
WACC8.98%
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.
Measured over the past years, RLI shows a quite strong growth in Earnings Per Share. The EPS has been growing by 17.43% on average per year.
RLI shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 12.07%.
RLI shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.02% yearly.
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
Based on estimates for the next years, RLI will show a small growth in Earnings Per Share. The EPS will grow by 2.66% on average per year.
Based on estimates for the next years, RLI will show a small growth in Revenue. The Revenue will grow by 3.44% on average per year.
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 26.97, which means the current valuation is very expensive for RLI.
Based on the Price/Earnings ratio, RLI is valued a bit more expensive than the industry average as 74.13% of the companies are valued more cheaply.
RLI is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.25, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 24.07, which indicates a rather expensive current valuation of RLI.
74.13% 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 22.15, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.97 | ||
| Fwd PE | 24.07 |
4.2 Price Multiples
RLI's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. RLI is more expensive than 61.54% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of RLI indicates a slightly more expensive valuation: RLI is more expensive than 61.54% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.7 | ||
| EV/EBITDA | 17.61 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of RLI may justify a higher PE ratio.
PEG (NY)3.58
PEG (5Y)1.55
EPS Next 2Y5.49%
EPS Next 3Y2.66%
5. Dividend
5.1 Amount
With a yearly dividend of 0.84%, RLI is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.23, RLI is paying slightly less dividend.
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 | 0.84% |
5.2 History
On average, the dividend of RLI grows each year by 12.36%, which is quite nice.
RLI has been paying a dividend for at least 10 years, so it has 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
68.15% of the earnings are spent on dividend by RLI. 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%
76.87
+0.57 (+0.75%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners81.94%
Inst Owner Change96.9%
Ins Owners0.85%
Ins Owner Change0.91%
Market Cap7.05B
Analysts67.69
Price Target78.8 (2.51%)
Short Float %1.61%
Short Ratio3.26
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.84% |
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)-3.13%
PT rev (3m)-5.56%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.07%
EPS NY rev (1m)-0.67%
EPS NY rev (3m)-0.6%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.27%
Revenue NY rev (1m)0.23%
Revenue NY rev (3m)0.58%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.97 | ||
| Fwd PE | 24.07 | ||
| P/S | 4.09 | ||
| P/FCF | 12.7 | ||
| P/OCF | 12.59 | ||
| P/B | 4.64 | ||
| P/tB | 4.8 | ||
| EV/EBITDA | 17.61 |
EPS(TTM)2.85
EY3.71%
EPS(NY)3.19
Fwd EY4.15%
FCF(TTM)6.05
FCFY7.87%
OCF(TTM)6.1
OCFY7.94%
SpS18.8
BVpS16.58
TBVpS16
PEG (NY)3.58
PEG (5Y)1.55
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
WACC8.98%
ROIC/WACC0.66
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%