In its consistent effort to share more profit with the
shareholders, the board of directors of
) has approved a special dividend of $3 per share.
RLI Corp. has been paying special dividends to its shareholders
over the past few years. This is in addition to the regular
dividend payout made by the company. The special dividend was
primarily supported by the company's sturdy financial position.
RLI Corp. has built a solid capital base through strong
investments and underwriting results. The company's sturdy focus
on expanding its business, new products and niche underwritings
continues to boost its capital base. The company exited the third
quarter with strong cash balance of $87.4 million which surged
97.2% from the 2012-end level. Retained earnings of $849.2
million as of Sep 30, 2013 also increased 9.1% from the 2012-end
Based on approximately 21.8 million shares outstanding as of Sep
30, RLI Corp. will have to dish out roughly $65 million for the
special dividend payments. Its sufficient liquidity will
comfortably cushion the payout.
The company will also pay the regular quarterly dividend of 34
cents per share to the shareholders.
Both the special cash dividend and quarterly cash dividend will
be paid on Dec 20 to the stockholders on record as of Nov 29,
RLI Corp.'s quarterly dividend currently yields at 1.40%. This
dividend yield is better than that of other property and casualty
United Insurance Holdings Corp.
) (yield of 1.20%) and
Platinum Underwriters Holdings Ltd.
) (yield of 0.51%).
RLI Corp. has been consistent in enhancing its shareholders'
value in the last few years through share repurchase activities
and dividend payments. Over a span of 5 years, it has returned
more than $600 million to its shareholders, thereby boosting
Along with the dividend payments, the board of directors of the
company also declared a two-for-one stock split. The stock split
will be effective on Jan 15, 2013 for shareholders on record as
of Dec 30, 2013.
Post the stock split, the number of shares outstanding will
double. Though there will be no change in market capitalization,
share price is expected to move down by around the same ratio.
PLATINUM UNDRWT (PTP): Free Stock Analysis
RLI CORP (RLI): Free Stock Analysis Report
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However, a higher share count is expected to be a drag on
earnings per share in the upcoming quarters.
RLI corp. presently carries a Zacks Rank #1 (Strong Buy). Another
property and casualty insurer,
) sporting the same Zacks Rank also appears impressive.