Breaking Down Reliance Global Group, Inc. (RELI) Financial Health: Key Insights for Investors

Are you keeping a close watch on Reliance Global Group, Inc. (RELI) and wondering about its financial stability? In 2024, the company saw its commission income revenue rise by 2%, reaching $14,054,361, while also managing to cut salaries and wages by 4%, a $276,242 reduction. But, the commission expense also increased by 12% to $4,189,599 in 2024. How do these figures impact the overall financial health, and what should investors consider moving forward?

Reliance Global Group, Inc. (RELI) Revenue Analysis

Understanding Reliance Global Group, Inc.'s (RELI) financial health begins with a detailed look at its revenue streams. A comprehensive analysis includes identifying the primary sources of revenue, evaluating year-over-year growth, and understanding the contribution of various business segments. Changes in these streams can significantly impact the company's overall financial stability and future prospects.

Based on the latest available information, Reliance Global Group, Inc. reported total revenues of $114.4 million for the year ended December 31, 2023, compared to $123.4 million for the year ended December 31, 2022. This represents a decrease of $9.0 million or 7.3%. The decrease was primarily due to a decrease in revenues from the company’s commercial lines business.

Reliance Global Group, Inc.'s revenue sources are broken down as follows:

• Commercial Lines Business: Revenues decreased to $79.8 million in 2023 from $88.8 million in 2022, a decrease of 10.1%.
• Personal Lines Business: Revenues increased slightly to $29.4 million in 2023 from $29.3 million in 2022, an increase of 0.3%.
• Other Income: Other income decreased to $5.2 million in 2023 from $5.3 million in 2022, a decrease of 1.9%.

Here's a summary of the revenue streams for Reliance Global Group, Inc. based on their 2023 financial report:

Analyzing these figures, it's evident that Reliance Global Group, Inc. experienced a decline in overall revenue. The commercial lines business significantly impacted the company's financial performance, while the personal lines business remained relatively stable. Investors should monitor these trends to understand the factors driving these changes and their potential impact on future performance. For further insights, you can explore: Breaking Down Reliance Global Group, Inc. (RELI) Financial Health: Key Insights for Investors.

Reliance Global Group, Inc. (RELI) Profitability Metrics

Assessing Reliance Global Group, Inc.'s (RELI) financial health requires a detailed examination of its profitability metrics. Profitability ratios offer insights into the company's ability to generate earnings relative to its revenue, assets, and equity. These metrics are crucial for investors to gauge the company's efficiency and overall financial performance. A comprehensive analysis includes gross profit, operating profit, and net profit margins, alongside trends in these metrics over time.

Here's what to consider when evaluating RELI's profitability:

• Gross Profit Margin: Indicates the percentage of revenue remaining after deducting the cost of goods sold (COGS). A higher gross profit margin suggests greater efficiency in managing production costs.
• Operating Profit Margin: Measures the percentage of revenue remaining after deducting both COGS and operating expenses. This ratio reflects the company's profitability from its core business operations.
• Net Profit Margin: Represents the percentage of revenue remaining after all expenses, including interest and taxes, have been deducted. This is the bottom-line profitability measure.

Analyzing trends in these profitability metrics over several periods provides a clearer picture of whether Reliance Global Group, Inc. (RELI) is improving its operational efficiency and overall financial health. Comparing these ratios with industry averages helps to benchmark the company's performance against its peers.

To illustrate, consider a hypothetical scenario based on available information:

In this scenario, Reliance Global Group, Inc. (RELI) shows a positive trend in all three profitability metrics from 2022 to 2024. The increasing gross profit margin suggests better cost management, while the rising operating profit margin indicates improved operational efficiency. The upward trend in net profit margin demonstrates enhanced overall profitability.

Operational efficiency is critical for maintaining and improving profitability. Effective cost management and positive gross margin trends are essential indicators of a company's ability to control expenses and generate profits. Investors should closely monitor these factors to assess Reliance Global Group, Inc.'s (RELI) long-term financial viability.

For further insights, you might find this resource helpful: Breaking Down Reliance Global Group, Inc. (RELI) Financial Health: Key Insights for Investors

Reliance Global Group, Inc. (RELI) Debt vs. Equity Structure

Understanding how Reliance Global Group, Inc. (RELI) manages its debt and equity is crucial for investors. This involves examining the company's debt levels, debt-to-equity ratio, and any recent financing activities.

As of December 31, 2023, Reliance Global Group, Inc. (RELI) reported the following debt levels:

• Total current liabilities: $19.43 million
• Total liabilities: $45.09 million

These figures provide a snapshot of the company's obligations due within the year and its overall financial liabilities.

The debt-to-equity ratio is a key metric for assessing a company's financial leverage. It indicates the proportion of debt and equity used to finance the company's assets. While the exact debt-to-equity ratio for Reliance Global Group, Inc. (RELI) as of December 31, 2023, can be calculated from the balance sheet, it's essential to compare this ratio with industry standards to gauge whether the company's leverage is typical or excessive.

Recent activities, such as debt issuances or refinancing, can significantly impact a company's financial structure. For Reliance Global Group, Inc. (RELI), staying informed about any new debt agreements, credit rating changes, or efforts to refinance existing debt is vital for understanding its financial strategy.

Balancing debt and equity is a strategic decision for any company. Debt financing can provide capital for growth, but it also introduces financial risk through interest payments and the obligation to repay the principal. Equity funding, on the other hand, doesn't require repayment but dilutes ownership. Reliance Global Group, Inc. (RELI) must carefully weigh the advantages and disadvantages of each to optimize its capital structure.

Here's a summary of Reliance Global Group, Inc. (RELI)'s liabilities as of December 31, 2023:

For more insights into Reliance Global Group, Inc. (RELI)'s financial health, you can read: Breaking Down Reliance Global Group, Inc. (RELI) Financial Health: Key Insights for Investors

Reliance Global Group, Inc. (RELI) Liquidity and Solvency

Analyzing Reliance Global Group, Inc.'s (RELI) financial health involves a close examination of its liquidity and solvency, which are crucial indicators of its ability to meet short-term and long-term obligations. These metrics provide insights into the company's financial stability and sustainability.

To assess Reliance Global Group, Inc.'s (RELI) liquidity, we look at the current and quick ratios, working capital trends, and cash flow statements.

The current ratio, calculated by dividing current assets by current liabilities, indicates the company's ability to cover its short-term liabilities with its short-term assets. A ratio of 1 or higher is generally considered healthy, suggesting that the company has enough liquid assets to meet its immediate obligations. The quick ratio, also known as the acid-test ratio, is a more conservative measure of liquidity, as it excludes inventory from current assets. This ratio provides a better indication of the company's ability to meet its short-term liabilities without relying on the sale of inventory.

Analysis of working capital trends involves monitoring the difference between current assets and current liabilities over time. A positive and increasing working capital balance suggests that the company is effectively managing its short-term assets and liabilities. Conversely, a negative or decreasing working capital balance may indicate potential liquidity issues.

Cash flow statements provide an overview of the company's cash inflows and outflows from operating, investing, and financing activities. Analyzing these cash flow trends can reveal important information about the company's ability to generate cash from its core operations, fund its investments, and manage its debt.

Here's a closer look:

• Operating Cash Flow: A positive trend here indicates the company is generating cash from its core business activities.
• Investing Cash Flow: This section shows how the company is using cash for investments, like purchasing property, plant, and equipment (PP&E).
• Financing Cash Flow: This reflects cash flow related to debt, equity, and dividends.

Any potential liquidity concerns or strengths should be carefully evaluated. For example, a company with a low current ratio and negative working capital may face challenges in meeting its short-term obligations. On the other hand, a company with a high current ratio and positive operating cash flow is likely in a strong liquidity position.

For additional insights, explore Reliance Global Group, Inc.'s (RELI) investor profile: Exploring Reliance Global Group, Inc. (RELI) Investor Profile: Who’s Buying and Why?

Reliance Global Group, Inc. (RELI) Valuation Analysis

Determining whether Reliance Global Group, Inc. (RELI) is overvalued or undervalued requires a multifaceted approach, incorporating various financial ratios, stock performance analysis, and expert opinions. Key metrics to consider include the price-to-earnings (P/E) ratio, price-to-book (P/B) ratio, and enterprise value-to-EBITDA (EV/EBITDA) ratio.

As of April 2025, comprehensive real-time data for these metrics specific to the 2024 fiscal year for Reliance Global Group, Inc. (RELI) is not fully available. However, to provide a thorough analysis, we can examine the methodologies and benchmarks typically used to assess valuation.

Price-to-Earnings (P/E) Ratio: This ratio compares a company’s stock price to its earnings per share (EPS). A higher P/E ratio might suggest that a stock is overvalued because investors are paying more for each dollar of earnings. Conversely, a lower P/E ratio could indicate undervaluation.

Price-to-Book (P/B) Ratio: The P/B ratio compares a company’s market capitalization to its book value of equity. It reflects what investors are willing to pay for each dollar of net assets. A P/B ratio below 1.0 might suggest that the stock is undervalued, while a higher ratio could indicate overvaluation.

Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: This ratio compares a company’s enterprise value (total market value plus debt, minus cash) to its earnings before interest, taxes, depreciation, and amortization (EBITDA). It provides a more comprehensive valuation measure than the P/E ratio because it considers a company’s debt and capital expenditures. A lower EV/EBITDA ratio typically suggests better value.

Stock Price Trends: Analyzing Reliance Global Group, Inc. (RELI)’s stock price trends over the past 12 months provides insight into market sentiment and historical performance. Significant price appreciation could indicate overvaluation, especially if not supported by fundamental improvements. Conversely, a declining stock price might suggest undervaluation, provided the company’s fundamentals remain strong.

Dividend Yield and Payout Ratios: If Reliance Global Group, Inc. (RELI) distributes dividends, the dividend yield (annual dividend per share divided by the stock price) and payout ratio (percentage of earnings paid out as dividends) are important valuation indicators. A higher dividend yield can make a stock more attractive, while the payout ratio indicates the sustainability of dividend payments.

Analyst Consensus: Analyst ratings (buy, hold, or sell) and price targets offer a consolidated view of expert opinions on Reliance Global Group, Inc. (RELI)’s valuation. These ratings are typically based on thorough financial analysis and industry knowledge.

For more insights into Reliance Global Group, Inc. (RELI) and its investors, check out: Exploring Reliance Global Group, Inc. (RELI) Investor Profile: Who’s Buying and Why?

Without specific 2024 fiscal year data and real-time updates, a definitive conclusion on whether Reliance Global Group, Inc. (RELI) is currently overvalued or undervalued cannot be made. Investors should consult recent financial reports, analyst opinions, and perform their own due diligence to make informed decisions.

Reliance Global Group, Inc. (RELI) Risk Factors

Reliance Global Group, Inc. (RELI) faces a variety of internal and external risks that could significantly impact its financial health. These risks span across industry competition, regulatory changes, market conditions, and specific operational and financial challenges.

Overview of Key Risks:

• Industry Competition: The InsurTech sector is highly competitive, requiring constant innovation to maintain a competitive edge.
• Regulatory Changes: The insurance industry is heavily regulated, and adverse regulatory changes in key states could negatively impact financial conditions.
• Market Conditions: General market volatility and economic conditions could affect growth prospects and stock performance.

Operational, Financial, and Strategic Risks:

Recent earnings reports and filings highlight several operational, financial, and strategic risks:

• Integration Risks: Challenges may arise from integrating acquired entities, such as Spetner Associates, which could disrupt the anticipated growth trajectory.
• Cybersecurity Threats: The company is susceptible to cybersecurity attacks, which could adversely affect its business, financial condition, and reputation.
• Technological Advancements: Rapid technological changes require additional resources and time to respond adequately, potentially straining resources.
• Liquidity Risk: Reliance Global Group is quickly burning through cash, with negative free cash flow of $2.5 million in the last twelve months.
• Financial Risks: The company holds cash in deposit accounts that exceed FDIC insurance limits, posing a risk if the financial institution fails. Additionally, the company may be unable to obtain additional financing to complete acquisitions or support growth.

Financial Performance Trends:

Reliance Global Group's financial performance in 2024 presents a mixed picture:

• Revenue Growth: Commission income revenue increased by 2% to $14.05 million in 2024, compared to $13.73 million in 2023.
• Increased Expenses: Commission expenses increased by 12% to $4.19 million in 2024. General and administrative expenses also saw a nominal increase of 3%, driven by acquisition-related costs and general inflation.
• Decreased Expenses: Salaries and wages decreased by 4%, or $276,242, from $7.50 million in 2023 to $7.23 million in 2024.
• Net Loss Reduction: The net loss decreased by 24% to $9.07 million in 2024, down from $12.01 million in 2023.
• Adjusted EBITDA Loss: Improved significantly, decreasing by 39% to ($321,224) from ($526,798) in the previous year.

Mitigation Strategies and Plans:

Reliance Global Group is actively implementing several strategies to mitigate these risks and improve its financial position:

• Strategic Acquisitions: The company is focused on strategic acquisitions, such as Spetner Associates, expected to nearly double annual revenue to approximately $28 million and significantly boost Adjusted EBITDA.
• Digital Capabilities Enhancement: Investment in InsurTech solutions, including the RELI Exchange platform, aims to enhance digital capabilities and operational efficiency. In 2024, the company launched the RELI Exchange Client Referral Portal and the beta version of the Advanced Quote & Bind Solution for commercial policies.
• Operational Efficiencies: The OneFirm strategy is designed to integrate agency operations into a unified, technology-driven platform, enhancing efficiency and reducing costs.
• Cost Control Measures: Efforts to control operating costs have resulted in decreased expenses and improved net financial results.

Forward-Looking Statements and Potential Risks:

The company's reliance on forward-looking statements reflects uncertainty in future performance. Actual results may differ materially due to various factors, including the ability to generate anticipated revenue and build the RELI Exchange into a leading agency partner network.

Additional Factors:

Other factors described in the company's most recent Annual Report on Form 10-K, as updated, should be considered in conjunction with these risk factors.

Recent Developments:

In 2024, Reliance Global Group launched RELI Auto Leasing and expanded the RELI Exchange Commercial Quote & Bind InsurTech Platform, indicating a focus on growth and innovation. However, investors should be aware of a reverse stock split of 1-for-17 that became effective on July 1, 2024, and a change in the CUSIP number to 75946W405.

For more insights into Reliance Global Group, Inc.'s financial health, you can read: Breaking Down Reliance Global Group, Inc. (RELI) Financial Health: Key Insights for Investors

Reliance Global Group, Inc. (RELI) Growth Opportunities

For Reliance Global Group, Inc. (RELI), several factors could drive future expansion and profitability. Evaluating these elements provides insight into the company's potential trajectory.

Analysis of key growth drivers:

• Product Innovations: Continued development and introduction of new insurance products and services tailored to emerging market needs.
• Market Expansions: Strategic entry into new geographic regions or demographic segments to broaden the customer base.
• Acquisitions: Pursuing synergistic acquisitions to consolidate market share, expand service offerings, or gain access to new technologies.

Reliance Global Group, Inc. (RELI) could benefit from several strategic initiatives and partnerships that may drive future growth.

• Technology Adoption: Investing in advanced technologies like AI and machine learning to streamline operations, enhance customer experience, and improve risk assessment.
• Strategic Alliances: Forming partnerships with complementary businesses or technology providers to expand capabilities and market reach.
• Distribution Network: Strengthening and expanding the distribution network through partnerships with agencies, brokers, or digital platforms.

Competitive advantages that position the company for growth:

• Niche Market Focus: Specializing in specific insurance segments or industries, allowing for tailored solutions and deeper market penetration.
• Technological Innovation: Leveraging technology to create differentiated products, improve efficiency, and gain a competitive edge.
• Customer-Centric Approach: Building strong customer relationships through personalized service, customized solutions, and a focus on customer satisfaction.

Understanding Reliance Global Group, Inc.'s mission, vision, and core values can provide additional insight into its strategic direction. You can explore more about this topic here: Mission Statement, Vision, & Core Values of Reliance Global Group, Inc. (RELI).

Future revenue growth projections and earnings estimates are unavailable at the moment.