Definitive Analysis
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Definitive Analysis

Financial Statements

Ticker

Industry

Sector

The Travelers Companies, Inc. (TRV)

Company Dividend Discount ModelIndustry: Insurance - Property & CasualtySector: Financial Services

Valuation Snapshot

Stable Growth$363.18 - $651.20$483.99
Multi-Stage$356.76 - $390.46$373.30
Blended Fair Value$428.64
Current Price$279.22
Upside53.52%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS2.42%2.69%4.143.963.813.793.753.683.553.423.303.22
YoY Growth--4.74%3.77%0.69%0.93%2.01%3.69%3.69%3.70%2.44%1.37%
Dividend Yield--1.57%1.73%2.22%2.07%2.49%3.70%2.57%2.46%2.74%2.76%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)5,874.00
(-) Cash Dividends Paid (M)977.00
(=) Cash Retained (M)4,897.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)1,174.80734.25440.55
Cash Retained (M)4,897.004,897.004,897.00
(-) Cash Required (M)-1,174.80-734.25-440.55
(=) Excess Retained (M)3,722.204,162.754,456.45
(/) Shares Outstanding (M)229.48229.48229.48
(=) Excess Retained per Share16.2218.1419.42
LTM Dividend per Share4.264.264.26
(+) Excess Retained per Share16.2218.1419.42
(=) Adjusted Dividend20.4822.4023.68
WACC / Discount Rate9.34%9.34%9.34%
Growth Rate3.50%4.50%5.50%
Fair Value$363.18$483.99$651.20
Upside / Downside30.07%73.34%133.22%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)5,874.006,138.486,414.866,703.697,005.527,320.947,540.57
Payout Ratio16.63%31.31%45.98%60.65%75.33%90.00%92.50%
Projected Dividends (M)977.001,921.722,949.524,065.995,277.016,588.856,975.02

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.34%9.34%9.34%
Growth Rate3.50%4.50%5.50%
Year 1 PV (M)1,740.761,757.581,774.40
Year 2 PV (M)2,420.212,467.202,514.65
Year 3 PV (M)3,022.173,110.613,200.77
Year 4 PV (M)3,552.973,692.283,835.65
Year 5 PV (M)4,018.494,216.404,422.04
PV of Terminal Value (M)67,113.1470,418.5073,852.83
Equity Value (M)81,867.7585,662.5989,600.34
Shares Outstanding (M)229.48229.48229.48
Fair Value$356.76$373.30$390.46
Upside / Downside27.77%33.69%39.84%

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