We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
RLI's Q4 Earnings Miss on Higher Expenses, Premiums Rise Y/Y
Read MoreHide Full Article
RLI Corp. (RLI - Free Report) reported fourth-quarter 2024 operating earnings of 41 cents per share, which missed the Zacks Consensus Estimate by 14.5%. The bottom line decreased 46.8% from the prior-year quarter.
The quarterly results reflect higher premiums and improved investment income, partially offset by higher expenses and poor underwriting income.
See the Zacks Earnings Calendar to stay ahead of market-making news.
Operational Performance
Operating revenues for the reported quarter were $436 million, up 15.3% year over year, driven by higher net premiums earned and net investment income. The top line matched the Zacks Consensus Estimate.
Gross premiums written increased 9% year over year to $473.2 million. This uptick can be attributed to the solid performance of the Casualty segment (up 18.3%). Our estimate was $550 million.
Net investment income increased 19% year over year to $38.8 million. The Zacks Consensus Estimate and our estimate for the metric were both pegged at $38.1 million. The investment portfolio’s total return was negative 1.1% in the quarter.
Total expenses rose 29.6% year over year to $379.2 million, primarily due to higher loss and settlement expenses, policy acquisition costs and interest expense on debt. Our estimate was $411.9 million.
Underwriting income of $22.2 million decreased 62.8% year over year. The combined ratio deteriorated 1,170 basis points (bps) year over year to 94.4. The Zacks Consensus Estimate for the metric was pegged at 96, while our estimate was 102.
Full-Year Highlights
Operating earnings of $2.87 per share improved 16.2% from the prior-year quarter.
Operating revenues were $1.7 billion million, up 18% year over year. Net premiums earned increased 17.9% to $1.53 billion and were in line with our estimate. Underwriting income increased 21.6% to $210.7 million. Our estimate was $180.5 million. The combined ratio improved 40 bps to 86.2, while our estimate was 88.2.
The investment portfolio’s total return was 6.4%.
Financial Update
RLI exited the quarter with total investments and cash of $4.1 billion, up 11.1% from 2023-end.
Book value was $16.59 per share as of Dec. 31, 2024, up 7.1% from the figure as of Dec. 31, 2023.
Net cash flow from operations was $560.2 million, up 21% year over year. The statutory surplus increased 17.6% from 2023-end to $1.8 billion as of Dec. 31, 2024.
Return on equity was 21.7%, contracting 640 bps from the year-ago period.
Dividend Update
The insurer paid a special dividend of $2.00 per share for the fourth quarter. Shareholder returns totaled $183.5 million.
RLI has paid dividends for 194 consecutive quarters and increased regular dividends in each of the last 49 years. Over the last 10 years, the company has returned nearly $1.5 billion to shareholders. The regular dividend has grown an average of 4.9% per year.
The Travelers Companies (TRV - Free Report) reported fourth-quarter 2024 core income of $9.15 per share, which beat the Zacks Consensus Estimate by 39.3% and improved 30.5% year over year. Travelers’ total revenues increased 10.4% from the year-ago quarter to $11.9 billion. The top-line figure beat the Zacks Consensus Estimate by 1%.
Net written premiums increased 7% year over year to a record $10.7 billion, driven by strong growth across all three segments. Our estimate was $10.8 billion. Net investment income increased 26% year over year to $955 million. The figure was higher than our estimate of $884.9 million. The Zacks Consensus Estimate was pegged at $926 million. Catastrophe loss was $175 million, pre-tax, wider than a loss of $125 million, pre-tax, incurred in the year-ago quarter. Travelers witnessed an underwriting gain of $1.4 billion, up 30.5% year over year. The consolidated underlying combined ratio of 84 improved 190 bps year over year.
Upcoming Releases
The Progressive Corporation (PGR - Free Report) is scheduled to report fourth-quarter 2024 results on Jan. 29, before market open. The Zacks Consensus Estimate for fourth-quarter earnings per share is pegged at $3.43, suggesting an increase of 15.9% from the year-ago quarter’s reported figure.
PGR’s earnings beat estimates in each of the last four quarters.
Chubb Limited (CB - Free Report) is slated to report fourth-quarter 2024 results on Jan. 28, after market close. The Zacks Consensus Estimate for fourth-quarter earnings per share is pegged at $5.50 per share, indicating a decrease of 33.7% from the year-ago quarter’s reported figure.
CB’s earnings beat estimates in each of the last four quarters.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
RLI's Q4 Earnings Miss on Higher Expenses, Premiums Rise Y/Y
RLI Corp. (RLI - Free Report) reported fourth-quarter 2024 operating earnings of 41 cents per share, which missed the Zacks Consensus Estimate by 14.5%. The bottom line decreased 46.8% from the prior-year quarter.
The quarterly results reflect higher premiums and improved investment income, partially offset by higher expenses and poor underwriting income.
See the Zacks Earnings Calendar to stay ahead of market-making news.
Operational Performance
Operating revenues for the reported quarter were $436 million, up 15.3% year over year, driven by higher net premiums earned and net investment income. The top line matched the Zacks Consensus Estimate.
Gross premiums written increased 9% year over year to $473.2 million. This uptick can be attributed to the solid performance of the Casualty segment (up 18.3%). Our estimate was $550 million.
RLI Corp. Price, Consensus and EPS Surprise
RLI Corp. price-consensus-eps-surprise-chart | RLI Corp. Quote
Net investment income increased 19% year over year to $38.8 million. The Zacks Consensus Estimate and our estimate for the metric were both pegged at $38.1 million. The investment portfolio’s total return was negative 1.1% in the quarter.
Total expenses rose 29.6% year over year to $379.2 million, primarily due to higher loss and settlement expenses, policy acquisition costs and interest expense on debt. Our estimate was $411.9 million.
Underwriting income of $22.2 million decreased 62.8% year over year. The combined ratio deteriorated 1,170 basis points (bps) year over year to 94.4. The Zacks Consensus Estimate for the metric was pegged at 96, while our estimate was 102.
Full-Year Highlights
Operating earnings of $2.87 per share improved 16.2% from the prior-year quarter.
Operating revenues were $1.7 billion million, up 18% year over year. Net premiums earned increased 17.9% to $1.53 billion and were in line with our estimate. Underwriting income increased 21.6% to $210.7 million. Our estimate was $180.5 million. The combined ratio improved 40 bps to 86.2, while our estimate was 88.2.
The investment portfolio’s total return was 6.4%.
Financial Update
RLI exited the quarter with total investments and cash of $4.1 billion, up 11.1% from 2023-end.
Book value was $16.59 per share as of Dec. 31, 2024, up 7.1% from the figure as of Dec. 31, 2023.
Net cash flow from operations was $560.2 million, up 21% year over year.
The statutory surplus increased 17.6% from 2023-end to $1.8 billion as of Dec. 31, 2024.
Return on equity was 21.7%, contracting 640 bps from the year-ago period.
Dividend Update
The insurer paid a special dividend of $2.00 per share for the fourth quarter. Shareholder returns totaled $183.5 million.
RLI has paid dividends for 194 consecutive quarters and increased regular dividends in each of the last 49 years. Over the last 10 years, the company has returned nearly $1.5 billion to shareholders. The regular dividend has grown an average of 4.9% per year.
Zacks Rank
RLI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurer
The Travelers Companies (TRV - Free Report) reported fourth-quarter 2024 core income of $9.15 per share, which beat the Zacks Consensus Estimate by 39.3% and improved 30.5% year over year. Travelers’ total revenues increased 10.4% from the year-ago quarter to $11.9 billion. The top-line figure beat the Zacks Consensus Estimate by 1%.
Net written premiums increased 7% year over year to a record $10.7 billion, driven by strong growth across all three segments. Our estimate was $10.8 billion. Net investment income increased 26% year over year to $955 million. The figure was higher than our estimate of $884.9 million. The Zacks Consensus Estimate was pegged at $926 million. Catastrophe loss was $175 million, pre-tax, wider than a loss of $125 million, pre-tax, incurred in the year-ago quarter. Travelers witnessed an underwriting gain of $1.4 billion, up 30.5% year over year. The consolidated underlying combined ratio of 84 improved 190 bps year over year.
Upcoming Releases
The Progressive Corporation (PGR - Free Report) is scheduled to report fourth-quarter 2024 results on Jan. 29, before market open. The Zacks Consensus Estimate for fourth-quarter earnings per share is pegged at $3.43, suggesting an increase of 15.9% from the year-ago quarter’s reported figure.
PGR’s earnings beat estimates in each of the last four quarters.
Chubb Limited (CB - Free Report) is slated to report fourth-quarter 2024 results on Jan. 28, after market close. The Zacks Consensus Estimate for fourth-quarter earnings per share is pegged at $5.50 per share, indicating a decrease of 33.7% from the year-ago quarter’s reported figure.
CB’s earnings beat estimates in each of the last four quarters.