Hsbc Holdings PLC Decreases Position in RLI Corp. $RLI

Key Points

• HSBC Holdings PLC sharply reduced its stake in RLI Corp. The bank cut its position by 89.4% in the fourth quarter, selling 49,570 shares and ending with 5,874 shares worth about $376,000.
• RLI reported mixed quarterly results and recently raised its dividend. The insurer beat EPS estimates at $0.83 per share, but revenue came in below expectations; it also increased its quarterly dividend to $0.18 from $0.16.
• Insiders have been buying shares, while analysts remain cautious. The CEO and a director both purchased stock in recent transactions, but the overall analyst consensus is still “Hold” with an average price target of $60.50.

Hsbc Holdings PLC lessened its stake in RLI Corp. (NYSE:RLI - Free Report) by 89.4% during the fourth quarter, according to its most recent filing with the Securities and Exchange Commission. The firm owned 5,874 shares of the insurance provider's stock after selling 49,570 shares during the quarter. Hsbc Holdings PLC's holdings in RLI were worth $376,000 at the end of the most recent quarter.

Several other institutional investors have also bought and sold shares of RLI. UBS Group AG raised its position in shares of RLI by 8.7% in the fourth quarter. UBS Group AG now owns 607,176 shares of the insurance provider's stock valued at $38,847,000 after purchasing an additional 48,563 shares during the period. SG Americas Securities LLC boosted its holdings in RLI by 1,030.2% in the 4th quarter. SG Americas Securities LLC now owns 34,009 shares of the insurance provider's stock worth $2,176,000 after buying an additional 31,000 shares during the period. Vanguard Group Inc. boosted its holdings in RLI by 3.4% in the 4th quarter. Vanguard Group Inc. now owns 9,448,929 shares of the insurance provider's stock worth $604,542,000 after buying an additional 310,857 shares during the period. Tudor Investment Corp ET AL grew its stake in RLI by 39.8% in the 3rd quarter. Tudor Investment Corp ET AL now owns 34,879 shares of the insurance provider's stock valued at $2,275,000 after buying an additional 9,932 shares in the last quarter. Finally, Chase Investment Counsel Corp purchased a new position in RLI in the 4th quarter valued at approximately $1,535,000. Hedge funds and other institutional investors own 77.89% of the company's stock.

Insider Buying and Selling at RLI

In related news, Director Clark C. Kellogg purchased 3,000 shares of the company's stock in a transaction dated Monday, June 1st. The shares were purchased at an average cost of $50.90 per share, with a total value of $152,700.00. Following the transaction, the director directly owned 4,502 shares in the company, valued at $229,151.80. This trade represents a 199.73% increase in their position. The purchase was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Also, CEO Craig W. Kliethermes bought 2,000 shares of the business's stock in a transaction dated Wednesday, May 27th. The stock was bought at an average cost of $52.00 per share, for a total transaction of $104,000.00. Following the completion of the purchase, the chief executive officer owned 150,990 shares of the company's stock, valued at approximately $7,851,480. The trade was a 1.34% increase in their position. Additional details regarding this purchase are available in the official SEC disclosure. In the last quarter, insiders have bought 16,500 shares of company stock worth $858,955. Corporate insiders own 2.39% of the company's stock.

RLI Price Performance

RLI opened at $61.40 on Friday. The stock's 50 day simple moving average is $54.78 and its 200 day simple moving average is $57.51. RLI Corp. has a 1 year low of $47.26 and a 1 year high of $71.11. The firm has a market cap of $5.65 billion, a price-to-earnings ratio of 14.35 and a beta of 0.38.

RLI (NYSE:RLI - Get Free Report) last released its quarterly earnings data on Wednesday, April 22nd. The insurance provider reported $0.83 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.73 by $0.10. RLI had a net margin of 20.81% and a return on equity of 17.72%. The firm had revenue of $423.87 million for the quarter, compared to analysts' expectations of $564.47 million. During the same quarter in the previous year, the company earned $0.92 earnings per share. The company's revenue for the quarter was up 4.0% compared to the same quarter last year. As a group, sell-side analysts anticipate that RLI Corp. will post 2.75 EPS for the current year.

RLI Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Friday, June 12th. Shareholders of record on Friday, May 29th were given a dividend of $0.18 per share. This is an increase from RLI's previous quarterly dividend of $0.16. This represents a $0.72 annualized dividend and a yield of 1.2%. The ex-dividend date of this dividend was Friday, May 29th. RLI's payout ratio is 16.82%.

Analysts Set New Price Targets

A number of analysts recently issued reports on RLI shares. Wall Street Zen raised RLI from a "sell" rating to a "hold" rating in a report on Sunday, July 12th. Keefe, Bruyette & Woods lifted their target price on RLI from $67.00 to $70.00 and gave the company an "outperform" rating in a report on Wednesday, July 8th. Zacks Research raised RLI from a "strong sell" rating to a "hold" rating in a report on Thursday, April 2nd. Wells Fargo & Company upped their price target on RLI from $55.00 to $62.00 and gave the company an "equal weight" rating in a research report on Thursday, July 9th. Finally, Weiss Ratings downgraded shares of RLI from a "hold (c-)" rating to a "sell (d+)" rating in a report on Friday, May 22nd. One equities research analyst has rated the stock with a Buy rating, five have issued a Hold rating and one has assigned a Sell rating to the company's stock. According to MarketBeat, RLI currently has a consensus rating of "Hold" and an average target price of $60.50.

About RLI

RLI Corporation NYSE: RLI is a specialty property and casualty insurance company focused on underwriting niche risks for businesses and individuals. Headquartered in Peoria, Illinois, the company operates through a network of independent agents and brokers, offering customized coverage solutions. RLI's approach emphasizes disciplined underwriting, targeted product development and strong customer service to maintain profitability and long-term growth.

Founded in 1965 as Replacement Lens, Inc, RLI initially provided insurance for contact lens manufacturers before shifting its focus to specialty insurance in the 1980s.

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