The Travelers Companies (NYSE:TRV) shares surged nearly 5% in the early session today after the insurance provider announced an impressive set of numbers for the fourth quarter. Net written premiums increased by 13.1% year-over-year to $9.99 billion. Further, EPS of $7.01 outpaced expectations by $1.92.
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A combination of higher underlying underwriting gains, lower catastrophe losses, and higher investment income helped TRV increase its core income to $1.63 billion from $810 million in the year-ago period. For the full year, net written premiums increased by 14% to $40.2 billion.
Further, the company’s fourth-quarter net investment income increased by 24% pre-tax owing to gains in fixed-income returns and fixed-maturity investments. Its underlying combined ratio stood at 85.9%, and book value per share improved to $109.19 at the end of this period.
Impressively, TRV delivered this performance amidst higher industry-wide catastrophe losses and a difficult environment for its personal insurance business. Additionally, the company has declared a quarterly dividend of $1 per share. The TRV dividend is payable on March 29 to investors of record on March 8.
Is TRV a Good Stock?
Overall, the Street has a Hold consensus rating on The Travelers Companies. Following a nearly 16% jump in the company’s share price over the past six months, the average TRV price target of $203.50 implies a modest 2.6% potential upside in the stock.
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