NYSE$TRV

Travelers · Q1 2021 earnings

Q1 2021 earnings · · Investor relations

Briefing

Reported strong first quarter with increased net income per diluted share and return on equity.

Travelers reported a strong first quarter with net income of $733 million and core income of $699 million, driven by strong underlying underwriting income, favorable prior year reserve development, and net investment income, despite record catastrophe losses. The company returned $613 million of capital to shareholders, increased its quarterly dividend by 4%, and authorized an additional $5.0 billion for share repurchases.

  • Net income was $733 million and core income was $699 million.
  • The consolidated combined ratio was 96.6%, with the underlying combined ratio improving to 89.5%.
  • Net written premiums increased by 2% to $7.505 billion.
  • Total capital returned to shareholders was $613 million, including $397 million in share repurchases.

Headline financials

Total Revenue

$8.31B

Previous: $7.91B+5.1%
EPS (adj)

$2.73

Previous: $2.62+4.2%
Combined Ratio

96.6%

Previous: 95.5%+1.2%
Underlying Combined Ratio

89.5%

Previous: 91.3%-2.0%
Free Cash Flow

$733M

Previous: $600M+22.2%
Net Income

$733M

Previous: $600M+22.2%
Operating Income

$969M

Previous: $800M+21.1%
Gross Profit

$2.14B

Previous: $1.94B+10.0%
Cash & Equivalents

$22.4B

Previous: $544M+4018.2%
Total Assets

$117B

Previous: $109B+6.9%

Revenue & EPS history

Travelers · Revenue · Quarterly

$8.31B

Q1 2021+5.1%vs Q1 2020
Beat estimate in 11 of 16 quarters(69%)
ActualEstimate

Revenue by segment

Travelers · $7.51B total across 3 segments · Q1 2021

  • Business Insurance
    $4.13B-1.6%
  • Personal Insurance
    $2.66B+6.6%
  • Bond & Specialty Insurance
    $723M+9.0%

Forward guidance

The strength of underwriting and investment expertise enabled Travelers to deliver strong profitability, notwithstanding the severe winter weather. They are particularly pleased with the strong underlying fundamentals in all three of their business segments.

Tailwinds

  • The company is well positioned to capitalize on opportunities as the economy recovers.
  • The company is confident that it will continue to create meaningful shareholder value over time.
  • The company's Board of Directors declared a 4% increase in the company's quarterly cash dividend to $0.88 per share.
  • The company's Board also authorized an additional $5 billion of share repurchases.
  • The company has a proven strategy, strong track record of execution, leading analytics and talent advantage.

Headwinds

  • High levels of catastrophe losses.
  • Actual claims may exceed the Company’s claims and claim adjustment expense reserves.
  • The Company’s potential exposure to asbestos and environmental claims and related litigation.
  • A period of financial market disruption or an economic downturn.
  • The intense competition that the Company faces, and the impact of innovation, technological change and changing customer preferences on the insurance industry and the markets in which it operates.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2021

Historical avgQ1 2021

+0.6%

Avg return

Earnings day

+0.3%

Avg return

5 days after

+2.1%

Avg return

30 days after

60%

44 / 73 earnings

Positive

+11.8%

Q3 2020

Best reaction

-6.9%

Q2 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.4%+0.7%+0.2%
Q4 2025+1.9%+4.5%+13.1%
Q3 2025-2.9%-0.0%+6.6%
Q2 2025-0.3%-0.2%+3.6%
Q1 2025+1.1%-0.0%+9.6%
Q4 2024+3.2%+5.0%+0.4%
Q3 2024+9.3%+6.7%+7.4%
Q2 2024-6.9%-5.8%-1.8%
Q1 2024-5.7%-4.0%-1.5%
Q4 2023+7.8%+6.4%+9.7%
Q3 2023-3.2%-6.0%+1.5%
Q2 2023+1.3%+0.9%-4.7%
Q1 2023+4.2%+4.1%+6.8%
Q4 2022+2.4%-4.4%-5.6%
Q3 2022+2.5%+7.8%+10.7%
Q2 2022-1.1%+1.7%+9.1%
Q1 2022-4.1%-6.5%-8.6%
Q4 2021+1.6%+5.3%+6.6%
Q3 2021+3.8%+6.2%+2.1%
Q2 2021+0.4%-2.2%+5.4%
Q1 2021+1.9%+2.2%+2.9%
Q4 2020+0.6%-0.9%+0.6%
Q3 2020+11.8%+12.6%+19.7%
Q2 2020-3.2%-5.9%-8.5%
Q1 2020+0.0%-0.9%-2.6%
Q4 2019-4.6%-4.9%-4.4%
Q3 2019-6.9%-8.1%-5.1%
Q2 2019-0.6%+0.1%-1.3%
Q1 2019+0.5%+1.6%+8.6%
Q4 2018-0.8%+0.8%+4.7%
Q3 2018-0.3%-2.1%+1.8%
Q2 2018-3.7%-4.0%+0.3%
Q1 2018-3.7%-2.9%-4.8%
Q4 2017+5.9%+7.2%-1.2%
Q3 2017+2.5%+2.4%-0.1%
Q2 2017-1.0%+0.8%+1.1%
Q1 2017-1.1%+0.8%+0.3%
Q4 2016-0.3%+0.1%+3.7%
Q3 2016-6.8%-6.2%-3.8%
Q2 2016+0.1%+0.5%+0.4%
Q1 2016-4.3%
Q4 2015-0.5%
Q3 2015+4.1%
Q2 2015+2.6%
Q1 2015-3.9%
Q4 2014+1.9%
Q3 2014+2.6%
Q2 2014-3.7%
Q1 2014+2.0%
Q4 2013-2.2%
Q3 2013-0.6%
Q2 2013-3.8%
Q1 2013+1.5%
Q4 2012+1.7%
Q3 2012+3.0%
Q2 2012-2.0%
Q1 2012+5.5%
Q4 2011+0.9%
Q3 2011+6.0%
Q2 2011+0.9%
Q1 2011+0.5%
Q4 2010+2.5%
Q4 2008+2.5%
Q4 2009+2.5%
Q3 2010+0.8%
Q2 2010+0.5%
Q1 2009-3.5%
Q1 2010-0.0%
Q3 2008+6.8%
Q3 2009+6.8%
Q4 2007+1.1%
Q2 2008+1.1%
Q2 2009+1.1%

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