Octave Specialty Group (NYSE:OSG) vs. RLI (NYSE:RLI) Head to Head Survey
by Danessa Lincoln · The Markets DailyOctave Specialty Group (NYSE:OSG – Get Free Report) and RLI (NYSE:RLI – Get Free Report) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, dividends, risk, analyst recommendations, institutional ownership, valuation and earnings.
Insider and Institutional Ownership
80.9% of Octave Specialty Group shares are owned by institutional investors. Comparatively, 77.9% of RLI shares are owned by institutional investors. 7.2% of Octave Specialty Group shares are owned by insiders. Comparatively, 2.4% of RLI shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Analyst Ratings
This is a breakdown of current recommendations and price targets for Octave Specialty Group and RLI, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Octave Specialty Group | 1 | 1 | 1 | 1 | 2.50 |
| RLI | 1 | 5 | 0 | 1 | 2.14 |
Octave Specialty Group currently has a consensus price target of $15.00, suggesting a potential upside of 158.84%. RLI has a consensus price target of $61.50, suggesting a potential upside of 14.28%. Given Octave Specialty Group’s stronger consensus rating and higher probable upside, analysts clearly believe Octave Specialty Group is more favorable than RLI.
Risk & Volatility
Octave Specialty Group has a beta of 0.86, suggesting that its stock price is 14% less volatile than the S&P 500. Comparatively, RLI has a beta of 0.41, suggesting that its stock price is 59% less volatile than the S&P 500.
Earnings & Valuation
This table compares Octave Specialty Group and RLI”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Octave Specialty Group | $251.22 million | 1.04 | -$261.69 million | ($4.86) | -1.19 |
| RLI | $1.90 billion | 2.61 | $403.34 million | $4.28 | 12.57 |
RLI has higher revenue and earnings than Octave Specialty Group. Octave Specialty Group is trading at a lower price-to-earnings ratio than RLI, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Octave Specialty Group and RLI’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Octave Specialty Group | -75.91% | -0.55% | -0.13% |
| RLI | 20.81% | 17.72% | 5.13% |
Summary
RLI beats Octave Specialty Group on 8 of the 14 factors compared between the two stocks.
About Octave Specialty Group
Ambac Financial Group, Inc. operates as a financial services holding company. It operates three businesses: Specialty Property and Casualty Insurance, Insurance Distribution, and Legacy Financial Guarantee (LFG) Insurance. The Specialty Property and Casualty Insurance business provides specialty property and casualty program insurance with a focus commercial and personal liability risks. The Insurance Distribution business includes the specialty property and casualty insurance distribution business, which includes managing general agents and underwriters, insurance wholesalers, brokers, and other distribution businesses. The LFG Insurance business offers financial guarantee insurance policies that provide an unconditional and irrevocable guarantee, which protects the holder of a debt obligation against non-payment when due of the principal and interest on the obligations guaranteed. Ambac Financial Group, Inc. was incorporated in 1991 and is headquartered in New York, New York.
About RLI
RLI Corp., an insurance holding company, underwrites property and casualty insurance. 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. It also offers coverages for security guards and environmental liability for underground storage tanks, contractors and asbestos, and environmental remediation specialists; and professional liability coverages for errors and omission coverage for small to medium-sized design, technical, computer, and miscellaneous professionals. This segment provides commercial automobile liability and physical damage insurance to local, intermediate and long haul truckers, public transportation entities, and other types of specialty commercial automobile risks; incidental and related insurance coverages; inland marine coverages; management liability coverages, such as directors and officers liability insurance, fiduciary liability and coverages, employment practice liability, and for various classes of risks, including public and private businesses; 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 commercial surety bonds for medium to large-sized businesses; small bonds for businesses and individuals; and bonds for small to medium-sized contractors. The company also engages in various reinsurance coverages. It markets its products through branch offices, wholesale and retail brokers, carrier partners, and underwriting and independent agents. RLI Corp. was incorporated in 1965 and is headquartered in Peoria, Illinois.