Earnings Preview: Travelers Group

| About: The Travelers (TRV)

Travelers Group (NYSE:TRV) is expected to report Q4 earnings on Tuesday, January 27 before the market opens, with a conference call scheduled for 9:00 am ET.

Guidance

Analysts are looking for EPS of $1.46 on revenue of $6.36B. The consensus range is $1.32-$1.70 for EPS, and $6.35B-$6.38B for revenue, according to First Call.

Analyst Views

Several analysts have recently been pessimistic about the property/casualty insurance sector in which Travelers operates. Earlier this month, Sandler O'Neill said it was less bullish about the sector because municipal bonds, in which many of the insurers invest, performed poorly last quarter. In addition, the firm sees a lack of pricing discipline in the sector, although it named Travelers as one company that does have some pricing discipline and will try to keep prices flat.

Meanwhile, Bernstein downgraded several non-life insurance companies, including Travelers, because the firm does not think these companies seem as eager as reinsurers to accept a pricing cycle. Bernstein dropped Travelers to Market Perform from Outperform.

In December, Goldman Sachs downgraded Travelers to Neutral from Buy. On a positive note, Hartford Insurance, which offers property and casualty insurance as well as life insurance, significantly raised its FY08 EPS guidance last month.