Travelers (TRV) Could Be a Great Choice

All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.Travelers in FocusHeadquartered in New York, Travelers (TRV) is a Finance stock that has seen a price change of -3.8% so far this year. The insurer is paying out a dividend of $0.93 per share at the moment, with a dividend yield of 2.06% compared to the Insurance - Property and Casualty industry's yield of 0.7% and the S&P 500's yield of 1.69%.Taking a look at the company's dividend growth, its current annualized dividend of $3.72 is up 1.4% from last year. In the past five-year period, Travelers has increased its dividend 5 times on a year-over-year basis for an average annual increase of 4.78%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Travelers's current payout ratio is 30%. This means it paid out 30% of its trailing 12-month EPS as dividend.Looking at this fiscal year, TRV expects solid earnings growth. The Zacks Consensus Estimate for 2023 is $14.09 per share, representing a year-over-year earnings growth rate of 13.45%.Bottom LineInvestors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. It's important to keep in mind that not all companies provide a quarterly payout.Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, TRV is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).This Little-Known Semiconductor Stock Could Be Your Portfolio’s Hedge Against InflationEveryone uses semiconductors. But only a small number of people know what they are and what they do. If you use a smartphone, computer, microwave, digital camera or refrigerator (and that’s just the tip of the iceberg), you have a need for semiconductors. That’s why their importance can’t be overstated and their disruption in the supply chain has such a global effect. But every cloud has a silver lining. Shockwaves to the international supply chain from the global pandemic have unearthed a tremendous opportunity for investors. And today, Zacks' leading stock strategist is revealing the one semiconductor stock that stands to gain the most in a new FREE report. It's yours at no cost and with no obligation.>>Yes, I Want to Help Protect My Portfolio During the RecessionWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Travelers Companies, Inc. (TRV): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
Read more on "Zacks"