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RLI's Stock Gains Following Q3 Earnings and Revenue Beat
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RLI Corp. (RLI - Free Report) reported third-quarter 2024 operating earnings of $1.31 per share, which beat the Zacks Consensus Estimate by 33.7%. The bottom line more than doubled year over year.
The quarterly results reflected the continued underwriting-focused business model and the strength of its diversified portfolio.
RLI stock rose 1.2% in the after-market trading session to reflect the outperformance.
Operating revenues for the reported quarter were $426 million, up 1.4% year over year, driven by 22.3% higher net premiums earned and 14.8% higher net investment income. The top line beat the Zacks Consensus Estimate of $420 million.
Gross premiums written increased 13% year over year to $563.4 million. This uptick can be attributed to the solid performance of the Casualty (up 15.7%), Property (up 9.6%) and Surety segments (up 9%). Our estimate was $572.3 million.
Net investment income increased 15% year over year to $36.7 million. Our estimate was $39.1 million. The investment portfolio’s total return was 4.8% in the quarter. The Zacks Consensus Estimate was pegged at $36 million.
Total expenses increased 11.3% year over year to $354.4 million due to higher loss and settlement expenses, higher policy acquisition costs, insurance operating expenses and general corporate expenses. Our estimate was $405.4 million.
Underwriting income increased to $40.7 million from $4.2 million in the year-ago quarter. The combined ratio improved 910 basis points (bps) year over year to 89.6. The Zacks Consensus Estimate for the metric was pegged at 96, while our estimate was 103.1.
Financial Update
RLI exited the quarter with total investments and cash of $4.2 billion, up 14.9% from 2023 end.
Book value was $38.17 per share as of Sept, 30, 2024, up 26% from the figure as of Dec. 31, 2023.
Net cash flow from operations was $219.4 million, up 122.5% year over year.
The statutory surplus increased 18.8% from the end of 2023 to $1.8 billion as of Sept. 30, 2024.
Return on equity was 38.4%, up 1810 bps from the year-ago period.
RLI's Dividend Update
On Sept. 20, 2024, RLI paid a dividend of 29 cents. RLI’s cumulative dividends totaled more than $822 million in the last five years.
The Travelers Companies (TRV - Free Report) reported third-quarter 2024 core income of $5.24 per share, which beat the Zacks Consensus Estimate by 38.2%. Total revenues increased 10.7% from the year-ago quarter to $11.84 billion, primarily driven by higher premiums, net investment income, fee income and other revenues. The top-line figure beat the Zacks Consensus Estimate by 1.4%.
Net written premiums increased 8% year over year to a record $11.31 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $10.5 billion. Travelers witnessed an underwriting gain of $685 million against a loss of $136 million incurred in the year-ago quarter. The consolidated underlying combined ratio of 85.6 improved 500 basis points (bps) year over year. The combined ratio improved 780 bps year over year to 93.2 due to an improvement in the underlying combined ratio and net favorable prior-year reserve development. The Zacks Consensus Estimate was pegged at 97.
The Progressive Corporation’s (PGR - Free Report) third-quarter 2024 earnings per share of $3.97 beat the Zacks Consensus Estimate of $3.40. The bottom line more than doubled year over year. Operating revenues of $19.5 billion improved 24.9% year over year and beat the consensus estimate by 2.6%.
Net premiums written were $19.5 billion in the quarter, up 25% from $15.6 billion a year ago. Combined ratio — the percentage of premiums paid out as claims and expenses — improved 340 bps from the prior-year quarter’s level to 89.
W.R. Berkley Corporation’s (WRB - Free Report) third-quarter 2024 operating income of 93 cents per share beat the Zacks Consensus Estimate by 1.1%. The bottom line improved 3.3% year over year. Operating revenues came in at $3.4 billion, up 10.9% year over year. The top line missed the consensus estimate by 0.8%.
W.R. Berkley’s net premiums written were a record $3.1 billion, up 7.3% year over year. The figure was $3.1 billion. The consolidated combined ratio (a measure of underwriting profitability) deteriorated 70 basis points year over year to 90.9. The Zacks Consensus Estimate was 92.
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RLI's Stock Gains Following Q3 Earnings and Revenue Beat
RLI Corp. (RLI - Free Report) reported third-quarter 2024 operating earnings of $1.31 per share, which beat the Zacks Consensus Estimate by 33.7%. The bottom line more than doubled year over year.
The quarterly results reflected the continued underwriting-focused business model and the strength of its diversified portfolio.
RLI stock rose 1.2% in the after-market trading session to reflect the outperformance.
RLI Corp. Price, Consensus and EPS Surprise
RLI Corp. price-consensus-eps-surprise-chart | RLI Corp. Quote
RLI's Operational Performance
Operating revenues for the reported quarter were $426 million, up 1.4% year over year, driven by 22.3% higher net premiums earned and 14.8% higher net investment income. The top line beat the Zacks Consensus Estimate of $420 million.
Gross premiums written increased 13% year over year to $563.4 million. This uptick can be attributed to the solid performance of the Casualty (up 15.7%), Property (up 9.6%) and Surety segments (up 9%). Our estimate was $572.3 million.
Net investment income increased 15% year over year to $36.7 million. Our estimate was $39.1 million. The investment portfolio’s total return was 4.8% in the quarter. The Zacks Consensus Estimate was pegged at $36 million.
Total expenses increased 11.3% year over year to $354.4 million due to higher loss and settlement expenses, higher policy acquisition costs, insurance operating expenses and general corporate expenses. Our estimate was $405.4 million.
Underwriting income increased to $40.7 million from $4.2 million in the year-ago quarter. The combined ratio improved 910 basis points (bps) year over year to 89.6. The Zacks Consensus Estimate for the metric was pegged at 96, while our estimate was 103.1.
Financial Update
RLI exited the quarter with total investments and cash of $4.2 billion, up 14.9% from 2023 end.
Book value was $38.17 per share as of Sept, 30, 2024, up 26% from the figure as of Dec. 31, 2023.
Net cash flow from operations was $219.4 million, up 122.5% year over year.
The statutory surplus increased 18.8% from the end of 2023 to $1.8 billion as of Sept. 30, 2024.
Return on equity was 38.4%, up 1810 bps from the year-ago period.
RLI's Dividend Update
On Sept. 20, 2024, RLI paid a dividend of 29 cents. RLI’s cumulative dividends totaled more than $822 million in the last five years.
Zacks Rank
RLI currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
The Travelers Companies (TRV - Free Report) reported third-quarter 2024 core income of $5.24 per share, which beat the Zacks Consensus Estimate by 38.2%. Total revenues increased 10.7% from the year-ago quarter to $11.84 billion, primarily driven by higher premiums, net investment income, fee income and other revenues. The top-line figure beat the Zacks Consensus Estimate by 1.4%.
Net written premiums increased 8% year over year to a record $11.31 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $10.5 billion. Travelers witnessed an underwriting gain of $685 million against a loss of $136 million incurred in the year-ago quarter. The consolidated underlying combined ratio of 85.6 improved 500 basis points (bps) year over year. The combined ratio improved 780 bps year over year to 93.2 due to an improvement in the underlying combined ratio and net favorable prior-year reserve development. The Zacks Consensus Estimate was pegged at 97.
The Progressive Corporation’s (PGR - Free Report) third-quarter 2024 earnings per share of $3.97 beat the Zacks Consensus Estimate of $3.40. The bottom line more than doubled year over year. Operating revenues of $19.5 billion improved 24.9% year over year and beat the consensus estimate by 2.6%.
Net premiums written were $19.5 billion in the quarter, up 25% from $15.6 billion a year ago. Combined ratio — the percentage of premiums paid out as claims and expenses — improved 340 bps from the prior-year quarter’s level to 89.
W.R. Berkley Corporation’s (WRB - Free Report) third-quarter 2024 operating income of 93 cents per share beat the Zacks Consensus Estimate by 1.1%. The bottom line improved 3.3% year over year. Operating revenues came in at $3.4 billion, up 10.9% year over year. The top line missed the consensus estimate by 0.8%.
W.R. Berkley’s net premiums written were a record $3.1 billion, up 7.3% year over year. The figure was $3.1 billion. The consolidated combined ratio (a measure of underwriting profitability) deteriorated 70 basis points year over year to 90.9. The Zacks Consensus Estimate was 92.