Group 1 - RLI Corp. reported reasonable premium growth and investment income for the quarter, but faces increasing competition in its Excess and Surplus (E&S) businesses, particularly in areas like Earthquake insurance [2] - The company is part of The Value Lab, which focuses on long-only value investment strategies, aiming for a portfolio yield of approximately 4% [1][2] - The Value Lab provides members with real-time updates, market news reports, feedback on stock ideas, and new trades on a monthly basis [2] Group 2 - The Valkyrie Trading Society consists of analysts who share high conviction investment ideas that are expected to yield non-correlated and outsized returns in the current economic environment [3]

Group 1 - RLI Corp. has experienced a downtrend with a stock decline of 12.6% over the past four weeks, indicating significant selling pressure [1] - The stock is currently in oversold territory, with an RSI reading of 26.68, suggesting that the heavy selling may be exhausting itself and a potential bounce back could occur [5][6] - Wall Street analysts have raised earnings estimates for RLI, with a 0.4% increase in the consensus EPS estimate over the last 30 days, which typically correlates with price appreciation [6] Group 2 - RLI holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, indicating a strong potential for a turnaround [7]

Financial Data and Key Metrics Changes - RLI Corp. reported fourth quarter operating earnings of $0.41 per share, with a 19% rise in investment income contributing to this performance [12] - The combined ratio for the quarter was 94.4%, influenced by hurricane losses and reserve additions [12] - Full-year results showed a combined ratio of 86.2%, slightly improved from 86.6% in 2023, marking the 29th consecutive year of underwriting profitability [13][54] - Net earnings per share on a GAAP basis were $0.44 for the quarter and $3.74 for the year, a 13% increase from the previous year [14] Business Line Data and Key Metrics Changes - The casualty segment's premiums grew by 18% in the fourth quarter, with a 10% rate change driven by auto coverages [29] - The surety segment remained flat in the quarter but grew by 9% year-to-date, with a combined ratio in the low 80s [20][38] - The property segment saw a 3% decline in gross premiums for the quarter, primarily due to E&S property, while marine and Hawaii homeowners segments experienced growth [22][49] Market Data and Key Metrics Changes - The company achieved a 12% growth in net written premium and a 22% growth in underwriting profits for the year [9] - The casualty group saw a top-line growth of 18% in the quarter, with significant contributions from transportation and personal umbrella products [16][29] - The property segment's gross premiums were down 3% in the quarter, driven by increased competition and rate softening in certain areas [22][41] Company Strategy and Development Direction - RLI Corp. remains focused on underwriting discipline and long-term decision-making to benefit stakeholders, with a proactive approach to managing legal system abuse in wheels-based businesses [10] - The company is committed to monitoring loss severity and adjusting reserves accordingly, particularly in the auto and transportation sectors [20][33] - RLI is leveraging its expertise in various segments to identify and capitalize on profitable growth opportunities while maintaining a conservative capital management strategy [27][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate challenges in the current operating environment, particularly regarding auto severity and competitive pressures [11][120] - The management team highlighted the importance of maintaining underwriting profitability while being cautious about growth in light of increasing loss trends [118][123] - Future growth opportunities are anticipated in the casualty segment, particularly in liability coverages and transportation, as the market continues to harden [120][121] Other Important Information - The company declared a special dividend of $2 per share, reflecting its consistent financial performance and capital stewardship [27] - RLI has returned nearly $1.5 billion to shareholders over the past decade, showcasing its commitment to shareholder value [27] Q&A Session Summary Question: Can you provide a relative split between the casualty reserves for the current accident year addition? - The split was approximately half for umbrella-related and half for transportation-related reserves [58] Question: What severity trends are being observed between transportation and personal umbrella? - The overall loss trend for auto-related exposures is assumed to be between 10 to 11 points [60] Question: What is the long-term outlook for the investment in Prime? - RLI currently owns about 25% of Prime and has reduced its participation in the quota share due to changing terms and conditions [71] Question: How does the company view the competitive environment in the surety business for 2025? - The surety business is highly competitive, but RLI expects to see growth opportunities driven by increased construction costs and strong relationships with producers [138][144]

Financial Data and Key Metrics Changes - RLI achieved a 12% growth in net written premium and a 22% growth in underwriting profits for the year, marking the 29th consecutive year of underwriting profit [6][19] - Operating earnings for Q4 were reported at $0.41 per share, with net earnings per share on a GAAP basis at $0.44 for the quarter and $3.74 for the year, a 13% increase from the previous year [8][10] - The combined ratio for Q4 was 94.4%, while the full year combined ratio was 86.2%, slightly improved from 86.6% in 2023 [9][10] Business Line Data and Key Metrics Changes - The casualty segment saw an 18% increase in premiums for Q4, with a 10% rate change driven by auto coverages [11][20] - The surety segment was flat in Q4 but up 9% year-to-date, maintaining a combined ratio in the low 80s [14][26] - The property segment experienced a 3% decline in gross premiums in Q4, primarily due to E&S Property, while marine and Hawaii homeowners grew significantly [15][32] Market Data and Key Metrics Changes - The company noted ongoing challenges in the motor vehicle exposures market, requiring measurable ongoing rate increases to address loss cost inflation [7] - The competitive landscape in the property segment has intensified, with rates softening, particularly in the wind business [15][28] - Submissions in the global business increased by 13% in Q4, marking three consecutive years of double-digit submission growth [29] Company Strategy and Development Direction - RLI remains focused on opportunities where it can differentiate itself and where the market allows for adequate returns, particularly in the casualty and transportation segments [6][7] - The company is committed to maintaining underwriting discipline and is willing to walk away from underpriced accounts [7][13] - RLI's capital management strategy includes returning nearly $1.5 billion to shareholders over the last decade, with a special dividend of $2 per share announced [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current operating environment, emphasizing proactive measures in response to loss severity trends [11][22] - The management team highlighted the importance of maintaining a strong feedback loop between underwriting and claims to ensure profitable growth [23][90] - Future growth opportunities are anticipated in the casualty segment, particularly in liability coverages and auto-related products [89] Other Important Information - The company recorded a total return of negative 1.1% for the quarter, impacted by bond price declines, but investment in Prime remains positive on an inception-to-date basis [18] - RLI's investment in Prime resulted in a loss of $12.5 million for the quarter due to reserve strengthening on prior accident years [18][49] Q&A Session Summary Question: Can you provide a relative split between the casualty reserves for the current accident year addition? - The split was approximately half for personal umbrella and half for transportation [40] Question: What severity trends are being observed in transportation and personal umbrella? - The overall loss trend for auto-related exposures is assumed to be in the 10 to 11 points range [41] Question: What is the long-term outlook for the investment in Prime? - The company currently owns about 25% of Prime and views it as a positive investment, with dividends received exceeding the original investment [48][49] Question: How does the company approach growth in the casualty segment given the severity trends? - The company trusts its product leaders to identify opportunities and supports them with data from claims and actuarial teams [88] Question: What is the competitive environment expected to be like for the surety business in 2025? - The surety business is highly competitive, but the company has a strong track record and is focused on building relationships with producers [106]

Core Insights - RLI Corp. reported fourth-quarter 2024 operating earnings of 41 cents per share, missing the Zacks Consensus Estimate by 14.5% and reflecting a 46.8% decrease from the prior-year quarter [1] - The quarterly results were influenced by higher premiums and improved investment income, but were partially offset by increased expenses and poor underwriting income [1] Operational Performance - Operating revenues for the quarter were $436 million, up 15.3% year over year, driven by higher net premiums earned and net investment income, matching the Zacks Consensus Estimate [2] - Gross premiums written increased 9% year over year to $473.2 million, attributed to strong performance in the Casualty segment, which rose 18.3% [2] Investment Income and Expenses - Net investment income rose 19% year over year to $38.8 million, exceeding both the Zacks Consensus Estimate and the company's estimate of $38.1 million [3] - Total expenses increased 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 [3] Underwriting Performance - Underwriting income decreased 62.8% year over year to $22.2 million, with the combined ratio deteriorating by 1,170 basis points to 94.4 [4] Full-Year Highlights - For the full year, operating earnings were $2.87 per share, up 16.2% from the prior year [5] - Operating revenues totaled $1.7 billion, an 18% increase year over year, with net premiums earned rising 17.9% to $1.53 billion [5] - Underwriting income increased 21.6% to $210.7 million, with the combined ratio improving by 40 basis points to 86.2 [5] Financial Update - RLI ended the quarter with total investments and cash of $4.1 billion, an 11.1% increase from the end of 2023 [6] - Book value per share was $16.59 as of December 31, 2024, up 7.1% from the previous year [6] - Net cash flow from operations was $560.2 million, a 21% year-over-year increase [6] - The statutory surplus rose 17.6% to $1.8 billion as of December 31, 2024 [6] - Return on equity was 21.7%, down 640 basis points from the year-ago period [6] Dividend Update - RLI paid a special dividend of $2.00 per share for the fourth quarter, with total shareholder returns amounting to $183.5 million [7] - The company has consistently paid dividends for 194 consecutive quarters and has increased regular dividends for the last 49 years [7][8] Industry Comparison - The Travelers Companies reported fourth-quarter 2024 core income of $9.15 per share, beating the Zacks Consensus Estimate by 39.3% and improving 30.5% year over year [10] - Travelers' total revenues increased 10.4% year over year to $11.9 billion, surpassing the Zacks Consensus Estimate by 1% [10]

Core Insights - RLI Corp. reported revenue of $435.95 million for the quarter ended December 2024, reflecting a year-over-year increase of 15.2% [1] - The company's EPS was $0.41, down from $0.77 in the same quarter last year, indicating a decline in profitability [1] - Revenue slightly missed the Zacks Consensus Estimate of $436.37 million, resulting in a surprise of -0.10% [1] - The EPS also fell short of the consensus estimate of $0.48, leading to an EPS surprise of -14.58% [1] Financial Performance Metrics - Net operating expenses were reported at 37.6%, better than the five-analyst average estimate of 38.6% [4] - Net loss and settlement expenses totaled 56.8%, compared to the five-analyst average estimate of 57.9% [4] - Underwriting income (loss) was at 94.4%, slightly below the average estimate of 96.5% [4] - Net premiums earned reached $397.18 million, which is a year-over-year increase of 14.8% but below the five-analyst average estimate of $398.26 million [4] - Net investment income was $38.78 million, exceeding the average estimate of $38.11 million, representing a year-over-year change of 19.1% [4] Segment Performance - Net premiums earned in the Property segment were $134.61 million, slightly below the estimated $136.52 million but showing a year-over-year increase of 16.1% [4] - Net premiums earned in the Surety segment were $36.74 million, below the estimate of $38.22 million, with a year-over-year increase of 8.1% [4] - Net premiums earned in the Casualty segment were $225.82 million, surpassing the average estimate of $223.17 million, reflecting a year-over-year increase of 15.2% [4] Stock Performance - RLI Corp.'s shares have returned -6.7% over the past month, contrasting with the Zacks S&P 500 composite's increase of +2.1% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

RLI Corp. (RLI) came out with quarterly earnings of $0.41 per share, missing the Zacks Consensus Estimate of $0.48 per share. This compares to earnings of $0.77 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -14.58%. A quarter ago, it was expected that this specialty insurance company would post earnings of $0.49 per share when it actually produced earnings of $0.66, delivering a surprise of 34.69%.Over the last four quarters ...

Financial Performance - RLI Corp. reported Q4 2024 net earnings of $40.9 million ($0.44 per share), down from $114.6 million ($1.24 per share) in Q4 2023[1][3] - Operating earnings for Q4 2024 were $38.4 million ($0.41 per share), compared to $71.1 million ($0.77 per share) in the same period of 2023[1][3] - Comprehensive loss for Q4 2024 was $26.3 million (-$0.28 per share), compared to comprehensive earnings of $216.2 million ($2.35 per share) in Q4 2023[13] - Net earnings for Q4 2024 decreased by 64.3% to $40,860 thousand, while full year net earnings increased by 13.5% to $345,779 thousand[32] Underwriting and Premiums - Gross premiums written increased by 11% to surpass $2 billion for the first time, with all product segments contributing to this growth[4] - Underwriting income for Q4 2024 was $22.2 million on a combined ratio of 94.4, compared to $59.8 million on an 82.7 combined ratio in Q4 2023[6][8] - For the full year 2024, RLI achieved $210.7 million of underwriting income on an 86.2 combined ratio, compared to $173.2 million on an 86.6 combined ratio in 2023[7][10] - Net premiums earned increased by 14.8% to $397,176 thousand for Q4 2024, and by 17.9% to $1,526,406 thousand for the full year 2024[32] - Gross premiums written for Q4 2024 reached $473,210,000, an increase of 8.9% from $434,360,000 in Q4 2023[38] - The gross premiums written for the twelve months ended December 31, 2024, were $2,013,048,000, a rise of 11.5% from $1,806,660,000 in 2023[38] Investment Income - Net investment income for Q4 2024 increased by 19% to $38.8 million, with full-year net investment income at $142.3 million, up from $120.4 million in 2023[12] - Net investment income rose by 19.1% to $38,776 thousand in Q4 2024, and by 18.2% to $142,278 thousand for the full year 2024[32] Shareholder Returns - RLI returned $236 million to shareholders through special and regular dividends, including a special dividend of $2.00 per share[4][15] - The company has paid dividends for 194 consecutive quarters and increased regular dividends for 49 consecutive years[15] - Cash dividends per share increased by 7.4% to $0.145 for ordinary dividends and doubled to $2.00 for special dividends[32] Assets and Liabilities - Total assets grew by 8.7% to $5,628,802 thousand as of December 31, 2024[36] - Total liabilities rose by 9.0% to $4,106,835 thousand[36] - The company reported a significant increase in equity securities at fair value, up 24.8% to $736,191 thousand[36] Operating Expenses - Loss and settlement expenses surged by 54.0% to $225,512 thousand in Q4 2024, and by 22.3% to $739,253 thousand for the full year 2024[32] - Net operating expenses for the total segment in Q4 2024 were $149,422,000, which is 37.6% of net premiums earned, compared to 40.4% in Q4 2023[38] - The net operating expenses for the twelve months ended December 31, 2024, were $576,500,000, which is 37.8% of net premiums earned, compared to 39.9% in 2023[38] Ratios and Performance Metrics - The net loss and settlement expenses ratio for the total segment in Q4 2024 was 56.8%, compared to 42.3% in Q4 2023, indicating a significant increase in loss ratios[38] - The net loss and settlement expenses for the twelve months ended December 31, 2024, were $739,253,000, with a total ratio of 48.4%[38] - The underwriting income (loss) for Q4 2024 was $22,242,000, a significant improvement from a loss of $59,847,000 in Q4 2023[38]

RLI Corp. (RLI) has been trading above its 50-day simple moving average (SMA), signaling a short-term bullish trend. Its share price, as of Jan. 16, 2025, was $77.83, down 14.6% from its 52-week high of $91.14.The 50-day SMA is a key indicator for traders and analysts to identify support and resistance levels. It is considered particularly important as this is the first marker of an uptrend or downtrend.With a market capitalization of $7.13 billion, RLI is set to gain from business expansion, rate increase, ...

In its upcoming report, RLI Corp. (RLI) is predicted by Wall Street analysts to post quarterly earnings of $0.95 per share, reflecting a decline of 38.3% compared to the same period last year. Revenues are forecasted to be $436.37 million, representing a year-over-year increase of 15.3%.The current level reflects a downward revision of 0.2% in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their initial pr ...