The Travelers Companies, Inc. (TRV)
Valuation Overview•Is The Travelers Companies, Inc. Overvalued or Undervalued?
Trading at a discount across both intrinsic cash flow and relative peer multiples, indicating a strong margin of safety.
High-quality fundamentals with a strong composite quality score of 75/100, backed by robust profitability and solvency.
Analysts remain cautious, with consensus price targets indicating limited room for upside expansion.
Verdict: Solid fundamental quality, though profitability presents a headwind.
Wall Street is cautious, forecasting potential downside. This outlook is strongly supported by highly attractive capital returns, driven predominantly by aggressive share repurchases.
TRV demonstrates strong business quality with robust profitability and healthy margins. This is paired with a moderately leveraged but stable balance sheet.
The company demonstrates solid revenue growth (9.8% 3Y CAGR) paired with highly explosive earnings growth (32.6% EPS 3Y CAGR). The company maintains healthy operational efficiency with a 19.3% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $11.9B | +5.2% | +9.8% | +8.8% | +6.2% | |
| EBITDA | $2.3B | — | +26.6% | — | — | |
| Net Income | $1.7B | +25.8% | +30.3% | — | +6.2% | |
| EPS (Diluted) | $7.78 | +27.8% | +32.6% | +21.1% | +9.7% | |
| Free Cash Flow | $2.2B | +16.9% | +17.9% | +10.2% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 44.0% | 30.8% | 28.6% | 27.4% |
| Operating Margin | 19.3% | 12.5% | 11.9% | 11.3% |
| Net Margin | 15.5% | 10.3% | 9.8% | 9.2% |
| FCF Margin | 23.4% | 20.0% | 19.7% | 18.0% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $7.07 | $7.71 | +9.1% | ||
| Q1'26 | $8.80 | $11.13 | +26.5% | ||
| Q4'25 | $6.39 | $8.14 | +27.4% | ||
| Q3'25 | $3.65 | $6.51 | +78.4% | ||
| Q2'25 | $0.79 | $1.91 | +143.3% | ||
| Q1'25 | $6.70 | $9.15 | +36.6% | ||
| Q4'24 | $3.55 | $5.24 | +47.6% | ||
| Q3'24 | $1.98 | $2.51 | +26.8% |
Total return is +22.2% (1Y), outperforming the benchmark by +1.4%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +13.3% | +6.0% | — |
| 1Y | +22.2% | +1.4% | +1.7% |
| 3YCAGR | +24.6% | +4.5% | +7.5% |
| 5YCAGR | +17.9% | +6.4% | +13.5% |
| 10YCAGR | +12.4% | -1.7% | — |
The S&P 500 is at 30.6x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about The Travelers Companies, Inc. (TRV) valuation, health, and returns.
The Travelers Companies, Inc. is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Slightly cheap versus peers compared to industry peers. undervalued (implying +40.6% upside to DCF intrinsic value of $460.18)
The Travelers Companies, Inc. has multiple valuation anchors: DCF Intrinsic Value: $460.18 | Peer Relative Fair Value: $370.64 | Wall Street Analyst Target: $310.40 (implying -5.2% upside). A convergence of these signals offers higher conviction.
The Travelers Companies, Inc. displays good financial health with a composite quality score of 75/100, supported by a Piotroski F-Score of 6/9, Return on Invested Capital (ROIC) of 15.2%.
The Travelers Companies, Inc. pays a 1.3% dividend yield, covered by a 16% payout ratio with 20 years of growth, supplemented by a 4.5% buyback yield.
The Travelers Companies, Inc.'s current growth trajectory is Decelerating. The company achieved +5.2% 1Y revenue growth and +27.8% 1Y EPS growth, compared to its 3Y revenue CAGR of +9.8%.
Wall Street consensus is Hold based on 43 analysts, beating EPS expectations in 75% of recent quarters with a 8-quarter streak. The consensus price target represents a -5.2% change from current levels.
Investment risks for The Travelers Companies, Inc. include: -8.6% 1-year max drawdown. Volatility risk is characterized by a beta of 0.05x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.