Raymond James has lifted its 12-month price target for Travelers (NYSE: TRV) to $330.00, up from $310.00, and reiterated a Strong Buy rating on the insurer's shares. Travelers was trading near $277.72 at the time of the update and carries a price-to-earnings ratio of 9.97 - a valuation metric the firm notes sits well below the insurance industry average.
The upgrade in the price objective follows higher operating earnings-per-share assumptions for the company. Raymond James now forecasts operating EPS of $27.00 for 2026 and $28.00 for 2027, and attributes the upward revision to several drivers.
Among the factors cited by the firm are expectations for increased net investment income and an acceleration of share repurchase activity. Raymond James also raised its assumptions for favorable prior-year development in both 2026 and 2027, adding further support to its revised valuation work.
Independent data referenced in the firms analysis shows Travelers with a "GREAT" financial health score of 3.3, and the company appears slightly undervalued on a Fair Value basis. The companys low P/E relative to near-term earnings momentum results in a modest PEG ratio of 0.35, a metric Raymond James highlights when discussing the stocks prospective attractiveness.
Those positive elements are tempered by near-term loss exposures. Raymond James expects first-quarter 2026 catastrophe losses stemming from Texas freeze exposure and northeastern wind activity. The firm also anticipates a higher personal insurance loss ratio profile tied to planned reductions in homeowners pricing beginning in 2026.
Travelers reported robust full-year results in its most recent quarter. The company delivered fourth-quarter 2025 earnings per share of $11.13, compared with a consensus forecast of $8.74, a 27.35% surprise to the upside. Revenue for the quarter reached $12.43 billion, outpacing expectations of $11.04 billion.
Analyst reactions to the quarterly beat have been mixed. Jefferies moved its price target to $305 and maintained a Hold rating. Mizuho trimmed its target to $304 and kept a Neutral stance, citing industry multiple compression. UBS retained a Neutral rating with a $290 price target while noting the companys stronger-than-expected earnings and ongoing share buybacks. Citizens reiterated a Market Perform rating and emphasized that the sizable earnings beat reflected improved reserve development and lower catastrophe losses.
In sum, Raymond Jamess revision to Travelers price target rests on higher operating EPS forecasts driven by investment income, repurchases and reserve development assumptions, balanced against expected Q1 2026 catastrophe exposure and homeowner pricing actions that could pressure loss ratios.