It has been about a month since the last earnings report for RLI Corp. (RLI). Shares have added about 4.2% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is RLI Corp. due for a pullback? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for RLI Corp. before we dive into how investors and analysts have reacted as of late.
RLI's Q3 Earnings, Revenues Beat Estimates on Solid Underwriting
RLI Corp. reported third-quarter 2025 operating earnings of 83 cents per share, which beat the Zacks Consensus Estimate by 33.9%. The bottom line increased 27.7% from the prior-year quarter. The quarterly results reflect higher net premiums earned and higher net investment income, as well as lower loss and settlement expenses.
Operational Performance
Operating revenues in the reported quarter were $449 million, up 5.3% year over year, driven by 4.7% higher net premiums earned and 12.5% higher net investment income. The top line beat the Zacks Consensus Estimate by 0.5%.
Gross premiums written of $562.3 million increased 0.5% year over year. The improvement in the performance of the Casualty segment was offset by a decline in Property and the Surety segment. Our estimate gross premiums written was $584.7 million. Net investment income increased 12% year over year to $41.3 million. Our estimate was $42.4 million. The Zacks Consensus Estimate was pegged at $42.5 million. The investment portfolio’s total return was 3% in the quarter.
Total expenses declined 0.2% year over year to $353.6 million, primarily due to lower loss and settlement expenses. Our estimate was $399 million. Underwriting income of $60.5 million increased 48.6% year over year. The combined ratio improved 450 basis points (bps) year over year to 85.1. Our estimate was 97.8.
Financial Update
RLI exited the quarter with total investments and cash of $4.7 billion, up 14.8% from 2024-end. Book value was $20.41 per share, up 26% from the figure as of Dec. 31, 2024.
Net cash flow from operations was $179.2 million, down 18.3% year over year. The statutory surplus increased 5.6% from the end of 2024 to $1.9 billion as of Sept. 30, 2025. Return on equity was 20.8%, down 690 bps from the year-ago period.
Dividend Update
On Sept. 19, 2025, RLI paid a dividend of 16 cents, an increase of 1 cent from the last payout. RLI’s cumulative dividends total more than $975 million in the last five years.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in estimates revision.
VGM Scores
At this time, RLI Corp. has a nice Growth Score of B, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock has a grade of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, RLI Corp. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
RLI Corp. belongs to the Zacks Insurance - Property and Casualty industry. Another stock from the same industry, Progressive (PGR), has gained 1.5% over the past month. More than a month has passed since the company reported results for the quarter ended September 2025.
Progressive reported revenues of $22.22 billion in the last reported quarter, representing a year-over-year change of +14.3%. EPS of $4.05 for the same period compares with $3.58 a year ago.
Progressive is expected to post earnings of $4.43 per share for the current quarter, representing a year-over-year change of +8.6%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.1%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Progressive. Also, the stock has a VGM Score of A.
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RLI Corp. (RLI): Free Stock Analysis Report The Progressive Corporation (PGR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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