Shares of Travelers Companies climbed Wednesday after the Dow Jones insurer posted blowout earnings for its Q1 results.
Travelers Companies reported earnings of $1.91 per share, vaulting over FactSet expectations for 79 cents. Net written premiums for the quarter rose 3% to $10.52 billion, just below estimates of $10.84 billion.
Total revenue increased 5% to $11.81 billion for the quarter vs. expectations for $12.1 billion.
Travelers said that its earnings declined from $4.69 per share last year due to higher catastrophe losses, which totaled $2.266 billion pretax for the quarter. The catastrophe losses were primarily driven by January's California wildfires. Travelers is one of the top 10 property and casualty insurers in California with a 4.3% market share. The Dow Jones firm in February estimated that the fires would cost $1.7 billion in pretax catastrophe losses.
Travelers' business insurance segment generated income of $683 million for the quarter, a decline of $81 million. Net written premiums for business insurance rose 2% to about $5.7 billion.
Net investment income helped counteract the wildfire losses, with Travelers booking $763 million in after-tax profit. The investment income gain was 10% before taxes.
Bond and specialty insurance income increased by $25 million to $220 million, with a 6% in written premiums for the segment to $999 million.
Travelers reported a 5% increase in written premiums for personal insurance to $3.82 billion. Meanwhile, the personal insurance segment recorded a loss of $374 million, compared to income of $220 million last year.
TRV stock pared gains to 1.1% Wednesday to close just above its 50-day line.
Travelers is working to recover after tumbling out of a 26-week base-building effort.
TRV stock has a 21-Day ATR% of 2.81.
The average true range is a metric available on IBD's MarketSurge charting tool. It gauges the characteristic breadth of a stock's behavior. Stocks that tend to make large jumps or dives in daily action, the kind that can trigger sell rules and shake investors out of a stock, have a high ATR. Stocks that tend to make more incremental moves have lower ATRs.
In the current, unpredictable market, IBD suggests stocks with ATRs of 3 or below.
Travelers stock is up 4.8% this year.
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