TRAVELERS COS INC/THE (TRV)
US89417E1091 - Common Stock
We assign a fundamental rating of 4 out of 10 to TRV. TRV was compared to 140 industry peers in the Insurance industry. While TRV is still in line with the averages on profitability rating, there are concerns on its financial health. TRV has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
TRV had positive earnings in the past year.
In the past year TRV had a positive cash flow from operations.
Each year in the past 5 years TRV has been profitable.
Each year in the past 5 years TRV had a positive operating cash flow.
1.2 Ratios
TRV's Return On Assets of 2.36% is fine compared to the rest of the industry. TRV outperforms 60.43% of its industry peers.
TRV has a Return On Equity (11.91%) which is in line with its industry peers.
Looking at the Return On Invested Capital, with a value of 2.66%, TRV is in the better half of the industry, outperforming 65.47% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for TRV is in line with the industry average of 4.09%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.36% | ||
| ROE | 11.91% | ||
| ROIC | 2.66% |
ROA(3y)2.6%
ROA(5y)2.49%
ROE(3y)12.53%
ROE(5y)11.36%
ROIC(3y)3.04%
ROIC(5y)2.96%
1.3 Margins
With a Profit Margin value of 7.17%, TRV perfoms like the industry average, outperforming 56.12% of the companies in the same industry.
TRV's Profit Margin has declined in the last couple of years.
TRV has a Operating Margin (9.09%) which is comparable to the rest of the industry.
In the last couple of years the Operating Margin of TRV has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.09% | ||
| PM (TTM) | 7.17% | ||
| GM | N/A |
OM growth 3Y-7.1%
OM growth 5Y-3.65%
PM growth 3Y-4.95%
PM growth 5Y-2.79%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so TRV is destroying value.
Compared to 1 year ago, TRV has less shares outstanding
TRV has less shares outstanding than it did 5 years ago.
The debt/assets ratio for TRV is higher compared to a year ago.
2.2 Solvency
TRV has a debt to FCF ratio of 1.04. This is a very positive value and a sign of high solvency as it would only need 1.04 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.04, TRV is in the better half of the industry, outperforming 74.10% of the companies in the same industry.
TRV has a Debt/Equity ratio of 0.32. This is a healthy value indicating a solid balance between debt and equity.
TRV's Debt to Equity ratio of 0.32 is fine compared to the rest of the industry. TRV outperforms 61.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 1.04 | ||
| Altman-Z | N/A |
ROIC/WACC0.31
WACC8.49%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
The earnings per share for TRV have decreased by -1.29% in the last year.
TRV shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.47% yearly.
The Revenue has grown by 12.04% in the past year. This is quite good.
Measured over the past years, TRV shows a small growth in Revenue. The Revenue has been growing by 6.44% on average per year.
EPS 1Y (TTM)-1.29%
EPS 3Y5.38%
EPS 5Y6.47%
EPS growth Q2Q106.18%
Revenue 1Y (TTM)12.04%
Revenue growth 3Y8.89%
Revenue growth 5Y6.44%
Revenue growth Q2Q13.36%
3.2 Future
The Earnings Per Share is expected to grow by 14.87% on average over the next years. This is quite good.
TRV is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.95% yearly.
EPS Next Y50.9%
EPS Next 2Y31.12%
EPS Next 3Y24.14%
EPS Next 5Y14.87%
Revenue Next Year10.62%
Revenue Next 2Y8.99%
Revenue Next 3Y7.32%
Revenue Next 5Y1.95%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 18.23, which indicates a rather expensive current valuation of TRV.
The rest of the industry has a similar Price/Earnings ratio as TRV.
TRV's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 25.05.
The Price/Forward Earnings ratio is 12.08, which indicates a correct valuation of TRV.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TRV is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of TRV to the average of the S&P500 Index (21.53), we can say TRV is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.23 | ||
| Fwd PE | 12.08 |
4.2 Price Multiples
TRV's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. TRV is cheaper than 77.70% of the companies in the same industry.
TRV's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. TRV is cheaper than 63.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.62 | ||
| EV/EBITDA | 5.41 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as TRV's earnings are expected to grow with 24.14% in the coming years.
PEG (NY)0.36
PEG (5Y)2.82
EPS Next 2Y31.12%
EPS Next 3Y24.14%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.81%, TRV has a reasonable but not impressive dividend return.
TRV's Dividend Yield is comparable with the industry average which is at 4.31.
Compared to the average S&P500 Dividend Yield of 2.39, TRV is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.81% |
5.2 History
The dividend of TRV has a limited annual growth rate of 5.33%.
TRV has paid a dividend for at least 10 years, which is a reliable track record.
TRV has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.33%
Div Incr Years18
Div Non Decr Years18
5.3 Sustainability
TRV pays out 30.59% of its income as dividend. This is a sustainable payout ratio.
TRV's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP30.59%
EPS Next 2Y31.12%
EPS Next 3Y24.14%
TRAVELERS COS INC/THE
NYSE:TRV (4/16/2024, 1:28:08 PM)
222.94
+1.88 (+0.85%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap51.08B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.81% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.23 | ||
| Fwd PE | 12.08 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.36
PEG (5Y)2.82
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.36% | ||
| ROE | 11.91% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 9.09% | ||
| PM (TTM) | 7.17% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.33
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-1.29%
EPS 3Y5.38%
EPS 5Y
EPS growth Q2Q
EPS Next Y50.9%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)12.04%
Revenue growth 3Y8.89%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y