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Travelers (TRV) to Report Q1 Earnings: What's in Store?
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The Travelers Companies, Inc. (TRV - Free Report) is set to report first-quarter 2020 earnings on Apr 21. The company delivered a positive surprise of 2.79% in the last reported quarter.
Let’s see how things have shaped up for the upcoming announcement.
Travelers’ to-be-reported quarter’s results are likely to benefit from higher net written premiums and improved performances of Personal Lines of business.
Strong retention, renewal premium change, higher pricing with both pure rate and exposure growth, strong underlying production results and higher levels of new business are likely to have fueled premiums increase in the to-be-reported quarter. The Zacks Consensus Estimate for premiums is pegged at $7.3 billion, indicating an increase of 7% from first-quarter 2019.
Continued growth at the profitable agency automobile and homeowners business, due to strong production, is likely to have aided personal lines of business.
The company’s auto insurance business is likely to have gained from a decline in claim costs due to fewer road accidents, with most Americans staying at home as a precautionary measure in view of the COVID-19 pandemic.
Travelers estimates net investment income (NII) to decrease approximately $5 million to $10 million after-tax per quarter from the first quarter of 2019 as the benefit of higher average levels of invested assets will be more than offset by a lower average yield on the portfolio given a lower interest rate environment. The Zacks Consensus Estimate for NII is pegged at $599 million, indicating an increase of 2.9% from the year-ago period reported figure.
Higher net written premiums driven by strong production results are likely to have aided the top line in the to-be-reported quarter. The Zacks Consensus Estimate for revenues is currently pegged at $8 billion, indicating 5.6% increase from the year-ago period reported figure.
Lower non-catastrophe weather-related losses along with the new catastrophe reinsurance treaty entered into in the first quarter of 2019 are likely to have aided underwriting income and combined ratio.
Continued share buybacks might have provided additional upside to the bottom line.
The Zacks Consensus Estimate for first-quarter earnings per share stands at $2.87, implying an increase of 1.41% from the year-ago quarter reported figure.
What Our Quantitative Model States
Our proven model predicts an earnings beat for Travelers this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Earnings ESP: Travelers has an Earnings ESP of +4.25%. This is because the Most Accurate Estimate is pegged at $2.99, higher than the Zacks Consensus Estimate of $2.87. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The Travelers Companies, Inc. Price and EPS Surprise
W.R. Berkley Corporation (WRB - Free Report) has an Earnings ESP of +0.12% and is a Zacks #3 Ranked player. The company is slated to announce first-quarter earnings on Apr 21.
Cincinnati Financial Corporation (CINF - Free Report) has an Earnings ESP of +1.67% and a Zacks Rank of 3. The company is set to release first-quarter earnings on Apr 27.
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Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
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Travelers (TRV) to Report Q1 Earnings: What's in Store?
The Travelers Companies, Inc. (TRV - Free Report) is set to report first-quarter 2020 earnings on Apr 21. The company delivered a positive surprise of 2.79% in the last reported quarter.
Let’s see how things have shaped up for the upcoming announcement.
Travelers’ to-be-reported quarter’s results are likely to benefit from higher net written premiums and improved performances of Personal Lines of business.
Strong retention, renewal premium change, higher pricing with both pure rate and exposure growth, strong underlying production results and higher levels of new business are likely to have fueled premiums increase in the to-be-reported quarter. The Zacks Consensus Estimate for premiums is pegged at $7.3 billion, indicating an increase of 7% from first-quarter 2019.
Continued growth at the profitable agency automobile and homeowners business, due to strong production, is likely to have aided personal lines of business.
The company’s auto insurance business is likely to have gained from a decline in claim costs due to fewer road accidents, with most Americans staying at home as a precautionary measure in view of the COVID-19 pandemic.
Travelers estimates net investment income (NII) to decrease approximately $5 million to $10 million after-tax per quarter from the first quarter of 2019 as the benefit of higher average levels of invested assets will be more than offset by a lower average yield on the portfolio given a lower interest rate environment. The Zacks Consensus Estimate for NII is pegged at $599 million, indicating an increase of 2.9% from the year-ago period reported figure.
Higher net written premiums driven by strong production results are likely to have aided the top line in the to-be-reported quarter. The Zacks Consensus Estimate for revenues is currently pegged at $8 billion, indicating 5.6% increase from the year-ago period reported figure.
Lower non-catastrophe weather-related losses along with the new catastrophe reinsurance treaty entered into in the first quarter of 2019 are likely to have aided underwriting income and combined ratio.
Continued share buybacks might have provided additional upside to the bottom line.
The Zacks Consensus Estimate for first-quarter earnings per share stands at $2.87, implying an increase of 1.41% from the year-ago quarter reported figure.
What Our Quantitative Model States
Our proven model predicts an earnings beat for Travelers this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Earnings ESP: Travelers has an Earnings ESP of +4.25%. This is because the Most Accurate Estimate is pegged at $2.99, higher than the Zacks Consensus Estimate of $2.87. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The Travelers Companies, Inc. Price and EPS Surprise
The Travelers Companies, Inc. price-eps-surprise | The Travelers Companies, Inc. Quote
Zacks Rank: Travelers carries a Zacks Rank #3.
Other Stocks to Consider
Some stocks from the insurance industry also with the apt combination of elements to surpass estimates this reporting cycle are as follows:
Chubb Limited (CB - Free Report) is set to report first-quarter earnings on Apr 21. It has an Earnings ESP of +0.86% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
W.R. Berkley Corporation (WRB - Free Report) has an Earnings ESP of +0.12% and is a Zacks #3 Ranked player. The company is slated to announce first-quarter earnings on Apr 21.
Cincinnati Financial Corporation (CINF - Free Report) has an Earnings ESP of +1.67% and a Zacks Rank of 3. The company is set to release first-quarter earnings on Apr 27.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>