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RLI Corp. (RLI) Soars 3.3%: Is Further Upside Left in the Stock?

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RLI Corp. (RLI - Free Report) shares soared 3.3% in the last trading session to close at $137.91. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 2.7% gain over the past four weeks.

Compelling portfolio, focus on specialty insurance lines and impressive record of underwriting profits and effective capital deployment continue to drive this insurer.

RLI boasts one of the industry’s most profitable P&C writers with an impressive track record of delivering 27 consecutive years of underwriting profitability. RLI is continuously taking efforts - drop the underperforming products from its property business, maintains significant reinsurance protection against large losses - to boost underwriting results.

The insurance industry is experiencing accelerated digitalization and RLI is no exception to that. The insurer is heavily investing in technological development to improve efficiency. This premier specialty underwriter remains focuses to generate long-term industry leading combined ratios and book value growth.

RLI has been paying dividends for 186 consecutive quarters and increased regular dividends in the last 47 straight years, increasing at an eight-year (2016-2022) CAGR of 55.9%. Its dividend yield is better than the industry average. It also paid 13th straight special dividend. The company has $87.5 million of remaining capacity from the repurchase program.

This specialty insurance company is expected to post quarterly earnings of $1.21 per share in its upcoming report, which represents a year-over-year change of -15.4%. Revenues are expected to be $342.42 million, up 19.3% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For RLI Corp., the consensus EPS estimate for the quarter has been revised 2.1% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on RLI going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

RLI Corp. is part of the Zacks Insurance - Property and Casualty industry. W.R. Berkley (WRB - Free Report) , another stock in the same industry, closed the last trading session 0.2% lower at $66.19. WRB has returned -5% in the past month.

W.R. Berkley's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.22. Compared to the company's year-ago EPS, this represents a change of +10.9%. W.R. Berkley currently boasts a Zacks Rank of #3 (Hold).

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