The Travelers Companies, Inc
) is set to report its second-quarter 2014 results on July 22. Last
quarter, the company posted a 38.5% positive earnings surprise.
Let's see how things are shaping up for this announcement.
Factors Influencing This Past Quarter
Underwriting results at Travelers is expected benefit from a benign
catastrophe environment, which drove underwriting results. Improved
pricing due to a favorable rate environment is also expected to
lead to an upside in the quarter to be reported.
Continued share repurchase will also boost the bottom line.
However, a soft interest rate environment continues to be a drag on
the investment results. Management expects lower reinvestment
yields from fixed maturity portfolio to lower net investment income
from that portfolio by $25 million in each of the remaining
quarters of 2014.
Our proven model does not conclusively show that Travelers is
likely to beat earnings this quarter. That is because a stock needs
to have both a positive
and a Zacks Rank #1, 2 or 3 for this to happen. That is not the
case here as you will see below.
: Travelers has an Earnings ESP of -0.97%. That is because
the Most Accurate estimate stands at $2.03 while the Zacks
Consensus Estimate is higher at $2.05.
: Travelers' Zacks Rank #2 (Buy) increases the predictive power of
ESP. However, we also need to have a positive ESP to be confident
about an earnings surprise.
Other Stocks to Consider
Here are some companies you may want to consider as our model shows
these have the right combination of elements to post an earnings
beat this quarter:
Everest Re Group Ltd.
), earnings ESP of +3.75% and a Zacks Rank #2 (Buy).
), earnings ESP of +0.89% and a Zacks Rank #3 (Hold).
Allied World Assurance Company Holdings, AG
) earnings ESP of +3.75% and a Zacks Rank #3.
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TRAVELERS COS (TRV): Free Stock Analysis Report
ACE LIMITED (ACE): Free Stock Analysis Report
EVEREST RE LTD (RE): Free Stock Analysis Report
ALLIED WORLD AS (AWH): Free Stock Analysis
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