Back to top

RLI Corp (RLI) Rewards Shareholders with Special Dividend

Read MoreHide Full Article

The board of directors of RLI Corp. (RLI - Free Report) recently approved a special cash dividend of $2.00 per share for the fourth quarter of 2016. RLI Corp. has been paying special dividend since 2011 and the recent one marks the sixth straight special dividend announcement. The insurer paid a special dividend of $2.00 last year as well.

RLI Corp. estimates a payout of about $88 million owing to the special dividend. This is well supported by its strong capital position. The P&C insurer maintains a solid balance sheet with sufficient liquidity and strong cash flows. This in turn enables the company to deploy capital through share repurchases, dividend hikes and special dividends to boost shareholders’ value.  Including the recently declared dividends, the company has returned more than $1.2 billion to shareholders over the last ten years.

Concurrently, the board of directors announced a regular quarterly cash dividend of 20 cents per share. Both these dividends will be paid on Dec 23, to shareholders on record as of Nov 30, 2016.

Apart from paying special dividends, the property and casualty (P&C) insurer is known for increasing dividends as evidenced by the continuous dividend hikes in the past 41 years. Moreover, the company’s regular quarterly dividend has grown at a six-year CAGR (2010–2016) of 7.44%. RLI Corp. remains focused on boosting and creating shareholders’ value, and is also optimistic about continuing to share more with investors through special dividends.

Currently RLI Corp. carries a Zacks Rank #4 (Sell).

Stocks to Consider

Some better-ranked stocks from the same space are Mercury General Corporation (MCY - Free Report) , National Interstate Corporation and Arch Capital Group Ltd. (ACGL - Free Report) . Each of these stocks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Mercury General is a P&C insurer engaged in writing personal automobile insurance in the U.S. The company delivered positive surprises in two of the last four quarters but with an average miss of 21.04.

National Interstate is a specialty P&C insurance company that operates primarily in the U.S. The company delivered positive surprises in two of the last four quarters with an average beat of 10.21%.

Arch Capital offers property, casualty, and mortgage insurance and reinsurance products worldwide. It delivered positive surprises in all of the last four quarter with an average beat of 9.27%.

Zacks' Top Investment Ideas for Long-Term Profit

How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

RLI Corp. (RLI) - free report >>

Mercury General Corporation (MCY) - free report >>

Arch Capital Group Ltd. (ACGL) - free report >>

More from Zacks Analyst Blog

You May Like