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Travelers Boosts Dividend & Buyback, But Q1 Earnings Miss Badly

TRV – Misses Wall Street consensus EPS estimates by $0.22 and misses on revenues.


Travelers Companies Inc (NYSE:TRV) early Thursday posted much worse than expected first quarter earnings results, but lifted its dividend and buyback significantly.

The St. Paul, MN-based insurance giant reported Q1 earnings per share (EPS) of $2.16, which was $0.22 worse than the Wall Street consensus estimate of $2.38.

Revenues rose 3.4% from last year to $6.18 billion, also missing analysts’ view for $6.25 billion..

TRV’s combined ratio, which includes catastrophe losses, was 96.0%. Its underlying combined ratio was a more respectable 91.7%. Combined ratio is an important industry metric used to measure the profitability of an insurer’s operations.

Travelers said it issued record net written premiums of $6.495 billion in the latest period, up 5% year-over-year, with growth seen in all segments.

The company also boosted its dividend and share buyback amid the report. Its new dividend payout of $0.72 per share is up 7.5% from prior levels, and will be paid on June 30, 2017 to shareholders of record as of June 9. Meanwhile, its board of directors authorized an additional $5.0 billion worth of share repurchases, in addition to the $709 million still remaining in its previous plan.

Travelers commented via press release:

“With technology and innovation driving customer preferences and expectations, advancing our digital agenda to best serve customers and our distribution partners, now and in the future, is a key strategic priority. To that end, during the quarter we announced an agreement to purchase Simply Business, a leading digital provider of insurance to small businesses in the United Kingdom. Our investment in Simply Business will accelerate our digital agenda, building on the competitive advantages that have enabled us to deliver industry-leading returns.”

Travelers Companies Inc shares were unchanged in premarket trading Thursday. Year-to-date, TRV has declined -1.11%, versus a 4.89% rise in the benchmark S&P 500 index during the same period.

TRV currently has a StockNews.com POWR Rating of A (Strong Buy), and is ranked #2 of 22 stocks in the Insurance – Life category.

TRV at a Glance

TRV Current POWR Rating™
Overall POWR Rating™
TRV Current Price $121.88 0.23%
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TRV Price Reaction

The day of this event (Apr. 20, 2017)
TRV Closing Price$118.88 1.26%
TRV Volume3,559,800
125.93% from avg
Leading up to this event
TRV 1-mo return1.60%
After this event
TRV 1-day return1.09%
TRV 3-day return0.76%
TRV 5-day return1.44%

TRV Price Chart

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