RLI Corp. (RLI): A Bull Case Theory

We came across a bullish thesis on RLI Corp. (RLI) on Substack by Serhio MaxDividends. In this article, we will summarize the bulls’ thesis on RLI. RLI Corp. (RLI)’s share was trading at $75.67 as of MONTH DATE. RLI’s trailing and forward P/E were 24.97 and 24.88 respectively according to Yahoo Finance.

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An experienced property and casualty insurance agent at a client’s home, explaining the benefits of the company’s homeowners’ insurance policies.

RLI Corp. (RLI), a $6.9 billion specialty insurer focused on niche property, casualty, and surety markets, recently raised its quarterly dividend by 6.7% to $0.16 per share, marking its 50th consecutive year of dividend increases—a testament to the company’s consistent financial strength and shareholder commitment. The dividend will be payable on June 20, 2025, to shareholders of record as of May 30, 2025. Despite a year-over-year decline in net earnings for Q1 2025, with $63.2 million ($0.68 per share) compared to $127.9 million ($1.39 per share) in Q1 2024, RLI reported solid operating earnings of $84.9 million ($0.92 per share), only slightly below the previous year’s $87.4 million ($0.95 per share). The company’s underwriting income remained robust at $70.5 million, supported by a healthy combined ratio of 82.3, indicating disciplined risk management. Growth in gross premiums written rose 5%, complemented by a 12% increase in net investment income to $36.7 million. Additionally, RLI’s book value per share grew 6% year-to-date to $17.48, reflecting steady balance sheet improvement.

Trading at $73.70 as of mid-May 2025, RLI offers a forward dividend yield of approximately 0.86%, combining a reliable income stream with strong fundamentals. RLI remains an attractive choice for investors seeking stability and disciplined growth in the specialty insurance sector.

RLI Corp. (RLI) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 31 hedge fund portfolios held RLI at the end of the fourth quarter which was 27 in the previous quarter. While we acknowledge the risk and potential of RLI as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than RLI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.