Evercore ISI has downgraded Travelers Companies to In Line from Outperform while raising its price target to $329 from $321, citing limited upside after the stock's recent move ahead of fundamentals. Analyst David Motemaden noted that Travelers remains one of the strongest property and casualty insurers but the risk-reward has become more balanced as valuation expanded, with the stock trading around 12 times forward P/E, above the 11 times average seen during previous soft insurance markets. Evercore highlighted strong reserves, higher investment income from rising yields, potential share buybacks, and technology-driven cost savings as key growth drivers, but expects only 3% EPS growth over the coming years, with estimates of $28.07 in 2026, $28.97 in 2027, and $29.78 in 2028. The firm also flagged pressure in personal auto insurance, which represents about 20% of net written premiums, and sees slower margin growth as larger rivals gain market share in a softening environment. Evercore estimates around 10% downside risk to valuation as the insurance cycle softens, with a more attractive entry point if Travelers trades below 11 times P/E or 1.9 times price-to-book value.
Evercore Partners Inc
Progressive CorpThe Travelers Companies IncDowngraded to In Line on valuation concerns; limited upside and 10% downside risk as cycle softens