RLI (NYSE:RLI) and NI (NASDAQ:NODK) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, risk, valuation, analyst recommendations, profitability and earnings.

Institutional & Insider Ownership

88.7% of RLI shares are owned by institutional investors. Comparatively, 20.2% of NI shares are owned by institutional investors. 5.5% of RLI shares are owned by company insiders. Comparatively, 0.4% of NI shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility and Risk

RLI has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, NI has a beta of 0.13, meaning that its share price is 87% less volatile than the S&P 500.

Valuation & Earnings

This table compares RLI and NI’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
RLI $818.12 million 3.81 $64.17 million $2.05 34.12
NI $189.14 million 1.96 $15.99 million N/A N/A

RLI has higher revenue and earnings than NI.

Dividends

RLI pays an annual dividend of $0.88 per share and has a dividend yield of 1.3%. NI does not pay a dividend. RLI pays out 42.9% of its earnings in the form of a dividend. RLI has increased its dividend for 42 consecutive years.

Analyst Recommendations

This is a summary of recent recommendations for RLI and NI, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RLI 1 3 0 0 1.75
NI 0 0 0 0 N/A

RLI currently has a consensus price target of $59.00, indicating a potential downside of 15.64%. Given RLI’s higher possible upside, equities analysts clearly believe RLI is more favorable than NI.

Profitability

This table compares RLI and NI’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RLI 7.84% 10.96% 3.05%
NI 14.42% 9.61% 5.95%

Summary

RLI beats NI on 11 of the 14 factors compared between the two stocks.

RLI Company Profile

RLI Corp., an insurance holding company, underwrites property and casualty insurance in the United States and internationally. Its Casualty segment provides commercial and personal coverage products; and general liability products, such as coverage for third-party liability of commercial insureds, including manufacturers, contractors, apartments, and mercantile. This segment also offers coverages for security guards and in the areas of onshore energy-related businesses and environmental liability for underground storage tanks, contractors and asbestos, and environmental remediation specialists; and professional liability coverages focuses on providing errors and omission coverage to small to medium-sized design, technical, computer, and miscellaneous professionals. In addition, this segment provides commercial automobile liability and physical damage insurance to local, intermediate and long haul truckers, public transportation entities, and equipment dealers; incidental and related insurance coverages; inland marine coverages; management liability coverages, such as directors and officers liability insurance, fiduciary liability and fidelity coverages, and for low to moderate classes of risks, including public and private businesses; and healthcare liability and home business insurance products. The company's Property segment offers commercial property, cargo, hull, protection and indemnity, marine liability, inland marine, homeowners' and dwelling fire, and other property insurance products. Its Surety segment offers small bonds for businesses and individuals; bonds for small to medium-sized contractors; commercial surety bonds for medium-to-large businesses; and commercial surety bonds for the energy, petrochemical, and refining industries. The company also underwrites various reinsurance coverages. The company markets its products through branch offices and independent agents. RLI Corp. was founded in 1965 and is headquartered in Peoria, Illinois.

NI Company Profile

NI Holdings, Inc. underwrites property and casualty insurance products in North Dakota, South Dakota, Nebraska, Minnesota, Nevada, and Arizona. Its products include multi-peril crop, crop hail, private passenger automobile, farm owners, homeowners, and commercial property and liability insurance policies. The company distributes its insurance products through independent producers and agents. The company was founded in 1946 and is headquartered in Fargo, North Dakota. NI Holdings, Inc. is a subsidiary of Nodak Mutual Group, Inc.

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