We expect property and casualty insurer
) to beat expectations when it reports its first-quarter 2014
results on April 16.
Why a Likely Positive Surprise?
Our proven model shows that RLI Corp. is likely to beat earnings
because it has the right combination of two key ingredients.
: Expected Surprise Prediction or
, which represents the difference between the Most Accurate
estimate and the Zacks Consensus Estimate, is +1.85%. This is
very meaningful and a leading indicator of a likely positive
earnings surprise for shares.
: RLI Corp. has a Zacks Rank #3 (Hold). Note that stocks with
Zacks Rank #1, 2 and 3 have significantly higher chances of
beating earnings. The Sell-rated stocks (#4 and 5) should never
be considered going into an earnings announcement.
The combination of RLI Corp's Zacks Rank #3 and +1.85% ESP makes
us very confident in looking forward to a positive earnings beat
on April 16.
What is Driving the Better-than-Expected
Better market conditions and new product offerings aiding higher
premiums, coupled with a benign cat environment favoring better
underwriting results, are expected to drive RLI Corp. to
outperform in the first quarter.
The positive trend is backed by the trailing three-quarter
average surprise of 29.1%, much of which was contributed by the
48.9% surprise achieved in the third quarter of 2013. Better
underwriting results continue to aid the company's performance.
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows they have the right combination of elements to post
an earnings beat this coming quarter:
Everest Re Group Ltd.
), earnings ESP of +16.67% and a Zacks Rank #1 (Strong Buy).
RenaissanceRe Holdings Ltd
), earnings ESP of +13.36% and a Zacks Rank #1.
) earnings ESP of +3.32% and a Zacks Rank #1.
ACE LIMITED (ACE): Free Stock Analysis Report
EVEREST RE LTD (RE): Free Stock Analysis
RLI CORP (RLI): Free Stock Analysis Report
RENAISSANCERE (RNR): Free Stock Analysis
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