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RLI Corp. (RLI) — WACC Analysis

WACC Breakdown

RLI Corp. (RLI) has a weighted average cost of capital (WACC) of 8.7%. The cost of equity is 9.2%, derived from a beta of 1.00 and a risk-free rate of 5.0%. The after-tax cost of debt is 1.9%. The capital structure is 93.4% equity and 6.6% debt.

Interpretation

A WACC of 8.7% is moderate, reflecting the market's balanced risk assessment of RLI Corp..

Investors can compare RLI's WACC of 8.7% against industry peers to gauge its relative financing costs. A beta of 1.00 reflects the stock's volatility relative to the broader market.

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VALUATION

RLI WACC: 8.71% for RLI Corp.

Current inputs imply a 9.19% cost of equity and a 2.38% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

RLI Corp. Common Stock (RLI) WACC Results
Weighted Average Cost of Capital
8.71%
Cost of Equity
9.19%
Risk-Free Rate4.96%
Beta1.00
Market Risk Premium4.23%
Cost of Debt
1.88%
Pre-Tax Cost of Debt2.38%
Tax Rate21.00%
Tax Shield0.50%
Capital Structure
Equity: 93.41%($5629.35M)
Debt: 6.59%($396.97M)
Equity Component
8.58%
93.41% × 9.19%
Debt Component
0.12%
6.59% × 1.88%

RLI Corp. (RLI) WACC in context

RLI Corp. (RLI) currently screens with an estimated WACC of 8.71%. That blends a 9.19% cost of equity, a 2.38% pre-tax cost of debt, and a 93.41% equity weight into the discount rate you would typically use in a DCF model.

falls into a common range for established public companies and is a practical DCF starting point.

What RLI WACC implies

A 8.71% discount rate falls into a common range for established public companies and is a practical DCF starting point.

How this page calculates RLI

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.00 and equity accounts for 93.41% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.