Zacks Investment Research upgraded shares of The Travelers Companies Inc. (TRV) from UNDERPERFORM to NEUTRAL on May 25, 2012, with a target price of $66.00.
We are upgrading Travelers to Neutral from Underperform on the back of strong first quarter results with operating earnings surpassing the Zacks Consensus Estimate. Lower share count due to share repurchases aided the bottom line. Top-line benefited on the heels of increase in premiums earned (attributable to pricing gains), though lower net investment income was partial offset. Moreover, increase in net favorable prior-year reserve development and decrease in cat losses came as a respite. Based on a high retention rate, pricing gains, positive renewal rate changes, favorable prior-year reserve development, prudent underwriting practice and a strong capital position, Travelers is poised to perform better going forward. Also, continued focus on maximizing shareholders wealth along with strong operational and financial performances boost investor confidence on the stock.
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