Travelers (TRV) Reiterated at Market Perform by Citizens Post Q2 Results

Citizens analyst Matthew Carletti reiterated a Market Perform rating on Travelers (NYSE: TRV).

The analyst commented, "We reaffirm our Market Perform rating on The Travelers Companies following better-than-expected second quarter results. Travelers reported operating EPS of $10.04, well above our estimate of $5.22 and consensus of $5.34. The beat versus our estimate was driven by better-than-projected reserve development ($578 mln favorable vs. $110 mln favorable est.), lower-than-projected catastrophe losses ($518 mln vs. $1,303 mln est.), lower-than-projected accident year ex-cat loss ratio (55.2% vs. 56.2% est.), and slightly higher NII ($1,070 vs. $1,021 mln est.). Book value was up +6% sequentially to $159, above our estimate of $155 and consensus of $156. During the quarter, Travelers repurchased $1.3 bln of shares, in line with our estimate. Travelers is a well-managed and disciplined underwriter, in our opinion, with one of the strongest franchises in the P&C insurance sector. However, we view the shares as fairly valued at the current 2.3x book value and ~12x 2027E EPS, with expectations for an ~17% ROE in 2027, and thus reaffirm our Market Perform rating."

For an analyst ratings summary and ratings history on Travelers click here. For more ratings news on Travelers click here.

Shares of Travelers closed at $368.98 yesterday.

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