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The Travelers Companies Inc (TRV)
NYSE:TRV
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Travelers Companies
(NYSE:TRV)
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Rating:74Outperform
Price Target:
$293.00
▲(11.83% Upside)
Travelers Companies' strong financial performance and positive earnings call are the most significant factors contributing to the overall score. The company's robust profitability and strategic shareholder returns highlight its stability and growth potential. However, bearish technical indicators and moderate valuation metrics slightly temper the overall outlook.
Positive Factors
Revenue Growth
Travelers' revenue growth surpassing expectations indicates strong market demand and effective business strategies, supporting long-term expansion.
Strong Underwriting Income
Significant growth in underwriting income reflects effective risk management and pricing strategies, enhancing profitability and competitive positioning.
Investment Income Increase
Rising investment income from a strong portfolio boosts overall earnings, providing a stable income stream and financial resilience.
Negative Factors
Decline in Property Line Premium
Declining property line premiums may indicate challenges in maintaining market share, potentially impacting future revenue from this segment.
Asbestos Charge Impact
The significant asbestos charge highlights potential liabilities and risk exposure, which could affect financial stability if not managed properly.
Challenges in New Business
Lower new business volumes in Bond and Specialty Insurance suggest difficulties in attracting new clients, which could hinder growth prospects.
Travelers Companies (TRV) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$58.44B
Dividend Yield1.64%
Average Volume (3M)1.15M
Price to Earnings (P/E)10.3
Beta (1Y)0.48
Revenue Growth6.75%
EPS Growth30.83%
CountryUS
Employees34,000
SectorFinancial
Sector Strength70
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)8.14
Shares Outstanding223,063,420
10 Day Avg. Volume1,388,451
30 Day Avg. Volume1,151,395
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)1.97
Price to Sales (P/S)1.18
P/FCF Ratio6.05
Enterprise Value/Market Cap1.25
Enterprise Value/Revenue1.52
Enterprise Value/Gross Profit5.67
Enterprise Value/Ebitda9.60
Forecast
1Y Price Target
$298.41Price Target Upside13.89% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering19
Travelers Companies Business Overview & Revenue Model
Company DescriptionThe Travelers Companies, Inc., through its subsidiaries, provides a range of commercial and personal property, and casualty insurance products and services to businesses, government units, associations, and individuals in the United states and internationally. The company operates through three segments: Business Insurance, Bond & Specialty Insurance, and Personal Insurance. The Business Insurance segment offers workers' compensation, commercial automobile and property, general liability, commercial multi-peril, employers' liability, public and product liability, professional indemnity, marine, aviation, onshore and offshore energy, construction, terrorism, personal accident, and kidnap and ransom insurance products. This segment operates through select accounts, which serve small businesses; commercial accounts that serve mid-sized businesses; national accounts, which serve large companies; and national property and other that serve large and mid-sized customers, commercial trucking industry, and agricultural businesses, as well as markets and distributes its products through brokers, wholesale agents, and program managers. The Bond & Specialty Insurance segment provides surety, fidelity, management and professional liability, and other property and casualty coverages and related risk management services through independent agencies and brokers. The Personal Insurance segment offers property and casualty insurance covering personal risks, primarily automobile and homeowners insurance to individuals through independent agencies and brokers. The Travelers Companies, Inc. was founded in 1853 and is based in New York, New York.
How the Company Makes MoneyTravelers Companies generates revenue primarily through the collection of premiums from its insurance policies. The company earns income by underwriting insurance policies, which involves assessing risk and determining the premiums charged to policyholders. Key revenue streams include commercial insurance premiums from businesses, personal insurance premiums from individuals, and investment income from managing its insurance reserves. Significant partnerships with agents and brokers enhance distribution and market reach, while a disciplined approach to underwriting and risk management helps maintain profitability. Additionally, Travelers invests in financial markets, which contributes to its earnings through investment income.
Travelers Companies Earnings Call Summary
Earnings Call Date:Oct 16, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Jan 27, 2026
Earnings Call Sentiment Positive
The earnings call reflects a strong financial performance with record earnings and robust shareholder returns. While there are challenges in certain lines such as property and new business in Bond and Specialty, the overall results and strategic positioning indicate a positive outlook.Q3-2025 Updates
Positive Updates
Record Core Income and Strong Return on Equity
Travelers reported core income of $1.9 billion or $8.14 per diluted share with a return on equity of 22.6% for the quarter, and a core return on equity of 18.7% for the trailing twelve months.
Growth in Net Written Premiums
Net written premiums grew to $11.5 billion, with business insurance growing by 3% to $5.7 billion. Excluding property lines, domestic net written premiums in the segment grew by more than 6%.
Investment Income Increase
After-tax net investment income increased by 15% to $850 million, driven by strong returns from the fixed income portfolio.
Shareholder Returns
Nearly $900 million was returned to shareholders, including $628 million in share repurchases, with plans for increased share repurchases in future quarters.
Segment Performance
All three business segments reported higher underwriting income, with Personal Insurance achieving a combined ratio of 81.3% and Bond and Specialty Insurance reporting a combined ratio of 81.6%.
Negative Updates
Decline in Property Line Premium
Premium volume in the property line continues to decline due to market dynamics, though domestic business excluding this line saw growth.
Asbestos Charge in Business Insurance
An asbestos charge of $277 million was recorded, although it was offset by favorable reserve development in other areas.
Challenges in New Business in Bond and Specialty
New business was lower compared to 2024 due to the Corvus production being reflected as renewal instead of new business.
Company Guidance
During the third quarter of fiscal year 2025, Travelers reported strong financial performance, highlighted by a core income of $1.9 billion or $8.14 per diluted share, and a return on equity of 22.6%, with a trailing twelve-month core return on equity of 18.7%. The results were driven by robust underwriting income of $1.4 billion pretax, which more than doubled year-over-year, alongside a 15% increase in after-tax net investment income to $850 million. The company achieved a record low underlying combined ratio of 83.9%, with net written premiums rising to $11.5 billion. This growth was supported by a 3% increase in business insurance premiums, including a 4% rise in the domestic market. Notably, Travelers returned nearly $900 million to shareholders, including $628 million in share repurchases, and plans for heightened repurchase activity in subsequent quarters due to excess capital. The company also reported strong metrics in its Bond and Specialty Insurance and Personal Insurance segments, with retention rates of 87% and 84% respectively, and a combined ratio of 81.6% in Bond and Specialty Insurance.Travelers Companies Financial Statement Overview
Summary
Travelers Companies exhibits strong financial health with consistent revenue growth, solid profitability margins, and a robust balance sheet. Efficient cash management is evident, supporting strategic flexibility. The low debt levels reduce financial risk, while high equity returns indicate efficient asset utilization. Overall, the company is well-positioned for continued stability and growth in the competitive insurance sector.Income Statement
The income statement shows strong revenue growth with a TTM increase of 11.4% from the previous year. The Gross Profit Margin remains consistent at 100%, indicative of the company's solid revenue base. The Net Profit Margin improved to 11%, reflecting better operational efficiency. The EBIT and EBITDA margins also demonstrate steady financial health with EBIT at 10.3% and EBITDA at 15.3% in TTM, ensuring robust profitability.85
Very Positive
Balance Sheet
The balance sheet indicates a stable financial position with a debt-to-equity ratio of 0.27, suggesting prudent leverage levels. The Return on Equity (ROE) increased to 17.8% in TTM, highlighting efficient equity usage. The Equity Ratio stands at 21.3%, reflecting a strong equity base, albeit slightly lower than ideal for full stability against liabilities.78
Positive
Cash Flow
Cash flow analysis reveals strong cash generation capabilities with a 6.2% growth in free cash flow in TTM. The Operating Cash Flow to Net Income ratio of 1.84 indicates excellent cash conversion efficiency, and the Free Cash Flow to Net Income ratio of 1.84 underscores the robust liquidity position despite heavy investing activities.82
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 47.84B | 46.43B | 41.37B | 36.90B | 34.82B | 31.98B |
| Gross Profit | 12.84B | 12.40B | 8.93B | 8.53B | 9.47B | 8.09B |
| EBITDA | 7.59B | 7.29B | 4.47B | 4.53B | 5.67B | 4.37B |
| Net Income | 5.25B | 5.00B | 2.99B | 2.84B | 3.66B | 2.70B |
Balance Sheet | ||||||
| Total Assets | 138.87B | 133.19B | 125.98B | 115.72B | 120.47B | 116.76B |
| Cash, Cash Equivalents and Short-Term Investments | 92.84B | 89.13B | 83.59B | 75.43B | 82.41B | 80.23B |
| Total Debt | 8.03B | 8.03B | 8.03B | 7.29B | 7.29B | 6.55B |
| Total Liabilities | 109.36B | 105.33B | 101.06B | 94.16B | 91.58B | 87.56B |
| Stockholders Equity | 29.52B | 27.86B | 24.92B | 21.56B | 28.89B | 29.20B |
Cash Flow | ||||||
| Free Cash Flow | 9.63B | 9.07B | 7.71B | 6.46B | 7.27B | 6.52B |
| Operating Cash Flow | 9.63B | 9.07B | 7.71B | 6.46B | 7.27B | 6.52B |
| Investing Cash Flow | -7.61B | -7.26B | -6.82B | -3.73B | -5.20B | -4.89B |
| Financing Cash Flow | -2.11B | -1.75B | -1.05B | -2.67B | -2.04B | -1.42B |
Travelers Companies Technical Analysis
Negative
262.01
Price Trends
273.26
Negative
267.89
Negative
259.55
Positive
Market Momentum
-1.99
Positive
36.12
Neutral
22.43
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TRV, the sentiment is Negative. The current price of 262.01 is below the 20-day moving average (MA) of 275.63, below the 50-day MA of 273.26, and above the 200-day MA of 259.55, indicating a neutral trend. The MACD of -1.99 indicates Positive momentum. The RSI at 36.12 is Neutral, neither overbought nor oversold. The STOCH value of 22.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TRV.
Travelers Companies Risk Analysis
Travelers Companies disclosed 23 risk factors in its most recent earnings report. Travelers Companies reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Travelers Companies Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $106.93B | 11.83 | 14.10% | 1.40% | 6.74% | -4.05% | |
77 Outperform | $28.09B | 16.85 | 20.63% | 1.81% | 11.41% | 15.32% | |
74 Outperform | $58.44B | 10.30 | 19.81% | 1.64% | 6.75% | 30.83% | |
73 Outperform | $51.61B | 9.21 | 27.33% | 2.00% | 9.81% | 94.71% | |
70 Outperform | $23.94B | 11.35 | 13.23% | ― | 1.66% | 8.51% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
64 Neutral | $1.24B | 25.39 | 4.05% | ― | -2.05% | ― |
* Financial Sector Average
TRV
Travelers Companies
262.01
6.54
2.56%
CB
Chubb
268.21
-25.71
-8.75%
ALL
Allstate
195.87
6.89
3.65%
MKL
Markel
1,892.00
292.82
18.31%
PRA
ProAssurance
24.05
8.58
55.46%
WRB
W. R. Berkley Corporation
74.05
14.24
23.81%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.