W. R. Berkley (NYSE:WRB) and The Travelers Companies (NYSE:TRV) are both large-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, earnings, profitability, risk, analyst recommendations, valuation and dividends.
Profitability
This table compares W. R. Berkley and The Travelers Companies' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
W. R. Berkley | 4.57% | 7.55% | 1.68% |
The Travelers Companies | 7.13% | 8.63% | 2.04% |
Volatility & Risk
W. R. Berkley has a beta of 0.82, suggesting that its stock price is 18% less volatile than the S&P 500. Comparatively, The Travelers Companies has a beta of 0.77, suggesting that its stock price is 23% less volatile than the S&P 500.
Dividends
W. R. Berkley pays an annual dividend of $0.48 per share and has a dividend yield of 0.7%. The Travelers Companies pays an annual dividend of $3.40 per share and has a dividend yield of 2.3%. W. R. Berkley pays out 15.8% of its earnings in the form of a dividend. The Travelers Companies pays out 35.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. W. R. Berkley has raised its dividend for 11 consecutive years and The Travelers Companies has raised its dividend for 16 consecutive years. The Travelers Companies is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Recommendations
This is a summary of recent ratings and price targets for W. R. Berkley and The Travelers Companies, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
W. R. Berkley | 0 | 4 | 3 | 0 | 2.43 |
The Travelers Companies | 3 | 10 | 5 | 0 | 2.11 |
W. R. Berkley currently has a consensus price target of $70.7143, indicating a potential upside of 2.00%. The Travelers Companies has a consensus price target of $135.20, indicating a potential downside of 7.08%. Given W. R. Berkley's stronger consensus rating and higher possible upside, analysts plainly believe W. R. Berkley is more favorable than The Travelers Companies.
Institutional & Insider Ownership
71.0% of W. R. Berkley shares are owned by institutional investors. Comparatively, 81.8% of The Travelers Companies shares are owned by institutional investors. 22.3% of W. R. Berkley shares are owned by company insiders. Comparatively, 0.8% of The Travelers Companies shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Earnings & Valuation
This table compares W. R. Berkley and The Travelers Companies' gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
W. R. Berkley | $7.90 billion | 1.56 | $681.94 million | $3.03 | 22.88 |
The Travelers Companies | $31.58 billion | 1.16 | $2.62 billion | $9.60 | 15.16 |
The Travelers Companies has higher revenue and earnings than W. R. Berkley. The Travelers Companies is trading at a lower price-to-earnings ratio than W. R. Berkley, indicating that it is currently the more affordable of the two stocks.
Summary
The Travelers Companies beats W. R. Berkley on 10 of the 17 factors compared between the two stocks.