Shares of Travelers (TRV) have been strong performers lately, with the stock up 8.4% over the past month. The stock hit a new 52-week high of $270.47 in the previous session. Travelers has gained 11.6% since the start of the year compared to the 1.9% move for the Zacks Finance sector and the 13.2% return for the Zacks Insurance - Property and Casualty industry.

What's Driving the Outperformance?

The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on April 16, 2025, Travelers reported EPS of $1.91 versus consensus estimate of $0.64.

For the current fiscal year, Travelers is expected to post earnings of $18.27 per share on $49.22 billion in revenues. This represents a -15.29% change in EPS on a 5.96% change in revenues. For the next fiscal year, the company is expected to earn $23.90 per share on $52.36 billion in revenues. This represents a year-over-year change of 30.75% and 6.38%, respectively.

Valuation Metrics

Travelers may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.

On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.

Travelers has a Value Score of A. The stock's Growth and Momentum Scores are D and B, respectively, giving the company a VGM Score of B.

In terms of its value breakdown, the stock currently trades at 14.7X current fiscal year EPS estimates, which is a premium to the peer industry average of 11.7X. On a trailing cash flow basis, the stock currently trades at 4.8X versus its peer group's average of 11.8X. Additionally, the stock has a PEG ratio of 3.66. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.

Zacks Rank

We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Travelers currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.

Story Continues

Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Travelers fits the bill. Thus, it seems as though Travelers shares could have a bit more room to run in the near term.

How Does TRV Stack Up to the Competition?

Shares of TRV have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Root, Inc. (ROOT). ROOT has a Zacks Rank of # 1 (Strong Buy) and a Value Score of D, a Growth Score of A, and a Momentum Score of C.

Earnings were strong last quarter. Root, Inc. beat our consensus estimate by 137.78%, and for the current fiscal year, ROOT is expected to post earnings of $0.18 per share on revenue of $1.29 billion.

Shares of Root, Inc. have gained 8.6% over the past month, and currently trade at a forward P/E of 777.39X and a P/CF of 47.91X.

The Insurance - Property and Casualty industry is in the top 19% of all the industries we have in our universe, so it looks like there are some nice tailwinds for TRV and ROOT, even beyond their own solid fundamental situation.

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The Travelers Companies, Inc. (TRV):Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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