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Here's Why You Should Hold RLI Stock in Your Portfolio Now
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RLI’s (RLI - Free Report) underwriting discipline, strong market position, broad range of product offerings, solid segmental underwriting income, strong liquidity, effective capital deployment, along with favorable growth estimates make it worth retaining in one’s portfolio.
RLI has a solid track record of beating earnings estimates in all four quarters of 2022. RLI’s total shareholder return has outperformed both its peer group and the S&P 500 by generating a return of 20.4% in the past five years.
Return on Equity (ROE)
Return on equity, a measure reflecting how efficiently a company utilizes shareholders’ money, was 19% in the trailing twelve months, better than the industry average of 6.7%.
Zacks Rank & Price Performance
RLI currently carries a Zacks Rank #3 (Hold). Year to date, the stock has gained 2%, outperforming the industry’s increase of 0.3%.
Image Source: Zacks Investment Research
Northbound Estimate Revision
The Zacks Consensus Estimate for 2023 has moved 0.4% north in the past 30 days, reflecting analyst optimism.
Optimistic Growth Projections
The Zacks Consensus Estimate for RLI’s 2024 earnings is pegged at $4.65, indicating a 4% increase from the year-ago estimated figure on 3.1% higher revenues of $1.5 billion.
Growth Drivers
RLI is one of the industry’s most profitable P&C writers and has had an impressive track record of providing 27 straight years of underwriting profitability. RLI continues to leverage its wide range of product offerings, strong branch-office networks and diversified and highly rated portfolio base to deliver superior underwriting results. Moreover, it keeps an eye on diversifying further into new markets and products by making relevant acquisitions.
The company's consistent increment in revenues, driven by higher premiums and net investment income, advocates its strong market position in the industry.
RLI’s business model strength lies in focusing on niche markets, which in turn differentiates it from its competitors. RLI’s products are managed as stand-alone businesses and are highly diversified, which fuels its growth and success. RLI also tailors its products to fill a gap in the market, contributing to the top line.
It envisions being a premier specialty underwriter having industry-leading combined ratios and book value growth. The insurer has a solid track of delivering a combined ratio below 100 for straight 27 years.
With a strong liquidity position, RLI has been increasing its dividend payout persistently for the past 47 years, achieving 5% growth rate in the past 10 years. RLI has also been distributing special dividends for the past 13 years, making it an attractive potential investment for yield-seeking investors.
The Zacks Consensus Estimate for Selective Insurance Group 2023 earnings indicates 30.6% year-over-year growth. In the past year, Selective Insurance’s stock has gained 30.5%.
The Zacks Consensus Estimate for SIGI’s 2023 earnings has moved 9.1% north in the past 30 days.
The Zacks Consensus Estimate for RenaissanceRe 2023 earnings indicates 219% year-over-year growth. In the past year, RenaissanceRe’s stock has gained 42%.
The Zacks Consensus Estimate for RNR’s 2023 earnings has moved 7.7% north in the past 30 days.
Arch Capital Group’s earnings surpassed the Zacks Consensus Estimate in the last three quarters of 2022, the average earnings surprise being 24.17%. In the past year, the insurer has gained 45%.
The Zacks Consensus Estimate for ACGL’s 2023 earnings has moved 7.7% north in the past 30 days.
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Here's Why You Should Hold RLI Stock in Your Portfolio Now
RLI’s (RLI - Free Report) underwriting discipline, strong market position, broad range of product offerings, solid segmental underwriting income, strong liquidity, effective capital deployment, along with favorable growth estimates make it worth retaining in one’s portfolio.
RLI has a solid track record of beating earnings estimates in all four quarters of 2022. RLI’s total shareholder return has outperformed both its peer group and the S&P 500 by generating a return of 20.4% in the past five years.
Return on Equity (ROE)
Return on equity, a measure reflecting how efficiently a company utilizes shareholders’ money, was 19% in the trailing twelve months, better than the industry average of 6.7%.
Zacks Rank & Price Performance
RLI currently carries a Zacks Rank #3 (Hold). Year to date, the stock has gained 2%, outperforming the industry’s increase of 0.3%.
Image Source: Zacks Investment Research
Northbound Estimate Revision
The Zacks Consensus Estimate for 2023 has moved 0.4% north in the past 30 days, reflecting analyst optimism.
Optimistic Growth Projections
The Zacks Consensus Estimate for RLI’s 2024 earnings is pegged at $4.65, indicating a 4% increase from the year-ago estimated figure on 3.1% higher revenues of $1.5 billion.
Growth Drivers
RLI is one of the industry’s most profitable P&C writers and has had an impressive track record of providing 27 straight years of underwriting profitability. RLI continues to leverage its wide range of product offerings, strong branch-office networks and diversified and highly rated portfolio base to deliver superior underwriting results. Moreover, it keeps an eye on diversifying further into new markets and products by making relevant acquisitions.
The company's consistent increment in revenues, driven by higher premiums and net investment income, advocates its strong market position in the industry.
RLI’s business model strength lies in focusing on niche markets, which in turn differentiates it from its competitors. RLI’s products are managed as stand-alone businesses and are highly diversified, which fuels its growth and success. RLI also tailors its products to fill a gap in the market, contributing to the top line.
It envisions being a premier specialty underwriter having industry-leading combined ratios and book value growth. The insurer has a solid track of delivering a combined ratio below 100 for straight 27 years.
With a strong liquidity position, RLI has been increasing its dividend payout persistently for the past 47 years, achieving 5% growth rate in the past 10 years. RLI has also been distributing special dividends for the past 13 years, making it an attractive potential investment for yield-seeking investors.
Stocks to Consider
Some better-ranked stocks from the Insurance sector are Selective Insurance Group (SIGI - Free Report) , RenaissanceRe (RNR - Free Report) ) and Arch Capital Group (ACGL - Free Report) . Selective Insurance Group and RenaissanceRe sport a Zacks Rank #1 (Strong Buy), while Arch Capital Group carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Selective Insurance Group 2023 earnings indicates 30.6% year-over-year growth. In the past year, Selective Insurance’s stock has gained 30.5%.
The Zacks Consensus Estimate for SIGI’s 2023 earnings has moved 9.1% north in the past 30 days.
The Zacks Consensus Estimate for RenaissanceRe 2023 earnings indicates 219% year-over-year growth. In the past year, RenaissanceRe’s stock has gained 42%.
The Zacks Consensus Estimate for RNR’s 2023 earnings has moved 7.7% north in the past 30 days.
Arch Capital Group’s earnings surpassed the Zacks Consensus Estimate in the last three quarters of 2022, the average earnings surprise being 24.17%. In the past year, the insurer has gained 45%.
The Zacks Consensus Estimate for ACGL’s 2023 earnings has moved 7.7% north in the past 30 days.