Travelers shares moved higher on Friday after the property and casualty insurer reported second-quarter earnings that beat Wall Street expectations, even though there was some doubt before the results.
The company reported adjusted earnings of $10.04 per share, up from $6.51 a year ago and much higher than the expected $5.41. Net premiums written were $11.53 billion, a bit lower than last year but still above analysts’ forecast of $11.26 billion, according to FactSet.
Chief executive Alan Schnitzer said the company’s strong earnings and cash flow make it possible to invest more in new technology, like artificial intelligence, which helps Travelers stay ahead of competitors.
Travelers shares were up about 2% in premarket trading on Friday, after gaining 2.6% on Thursday. The stock has risen about 17% this year, including a 13% increase last month, and is up around 34% over the past year, beating other companies in the sector.
Some analysts have become more skeptical about the stock’s rally. This week, Morgan Stanley downgraded Travelers, saying the risk and reward are less attractive after the recent gains. Earlier in the week, TD Cowen also became more cautious, noting that the rally does not match the weaker fundamentals seen in the insurance industry.
