The Travelers Companies, Inc. (NYSE:TRV) will increase its dividend from last year’s comparable payment on the 30th of June to $1.10. This makes the dividend yield about the same as the industry average at 1.6%.
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Travelers Companies’ Projected Earnings Seem Likely To Cover Future Distributions
We like a dividend to be consistent over the long term, so checking whether it is sustainable is important. However, prior to this announcement, Travelers Companies’ dividend was comfortably covered by both cash flow and earnings. This means that most of its earnings are being retained to grow the business.
Over the next year, EPS is forecast to expand by 34.0%. If the dividend continues along recent trends, we estimate the payout ratio will be 18%, which is in the range that makes us comfortable with the sustainability…
