Travelers Companies (NYSE:TRV) and Willis Towers Watson Public (NASDAQ:WTW) Financial Comparison

Travelers Companies (NYSE:TRV) and Willis Towers Watson Public (NASDAQ:WTW) are both large-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, dividends, institutional ownership, valuation and risk.

Volatility & Risk

Travelers Companies has a beta of 0.44, meaning that its stock price is 56% less volatile than the S&P 500. Comparatively, Willis Towers Watson Public has a beta of 0.41, meaning that its stock price is 59% less volatile than the S&P 500.

Earnings and Valuation

This table compares Travelers Companies and Willis Towers Watson Public”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Travelers Companies	$48.83 billion	1.58	$6.29 billion	$37.34	9.88
Willis Towers Watson Public	$10.10 billion	3.08	$1.60 billion	$16.26	20.59

Travelers Companies has higher revenue and earnings than Willis Towers Watson Public. Travelers Companies is trading at a lower price-to-earnings ratio than Willis Towers Watson Public, indicating that it is currently the more affordable of the two stocks.

Dividends

Travelers Companies pays an annual dividend of $5.00 per share and has a dividend yield of 1.4%. Willis Towers Watson Public pays an annual dividend of $3.84 per share and has a dividend yield of 1.1%. Travelers Companies pays out 13.4% of its earnings in the form of a dividend. Willis Towers Watson Public pays out 23.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Travelers Companies has increased its dividend for 21 consecutive years and Willis Towers Watson Public has increased its dividend for 8 consecutive years. Travelers Companies is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Travelers Companies and Willis Towers Watson Public’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Travelers Companies	16.95%	25.41%	5.75%
Willis Towers Watson Public	15.49%	22.19%	6.00%

Institutional and Insider Ownership

82.5% of Travelers Companies shares are owned by institutional investors. Comparatively, 93.1% of Willis Towers Watson Public shares are owned by institutional investors. 1.4% of Travelers Companies shares are owned by company insiders. Comparatively, 0.4% of Willis Towers Watson Public shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings for Travelers Companies and Willis Towers Watson Public, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Travelers Companies	5	13	4	4	2.27
Willis Towers Watson Public	0	7	10	1	2.67

Travelers Companies presently has a consensus target price of $354.26, indicating a potential downside of 4.00%. Willis Towers Watson Public has a consensus target price of $369.38, indicating a potential upside of 10.35%. Given Willis Towers Watson Public’s stronger consensus rating and higher probable upside, analysts plainly believe Willis Towers Watson Public is more favorable than Travelers Companies.

Summary

Travelers Companies beats Willis Towers Watson Public on 11 of the 18 factors compared between the two stocks.

About Travelers Companies

The Travelers Companies, Inc., through its subsidiaries, provides a range of commercial and personal property, and casualty insurance products and services to businesses, government units, associations, and individuals in the United States and internationally. The company operates through three segments: Business Insurance, Bond & Specialty Insurance, and Personal Insurance. The Business Insurance segment offers workers’ compensation, commercial automobile and property, general liability, commercial multi-peril, employers’ liability, public and product liability, professional indemnity, marine, aviation, onshore and offshore energy, construction, terrorism, personal accident, and kidnap and ransom insurance products. This segment operates through select accounts, which serve small businesses; commercial accounts that serve mid-sized businesses; national accounts, which serve large companies; and national property and other that serve large and mid-sized customers, commercial trucking industry, and agricultural businesses, as well as markets and distributes its products through brokers, wholesale agents, and program managers. The Bond & Specialty Insurance segment provides surety, fidelity, management and professional liability, and other property and casualty coverages and related risk management services through independent agencies and brokers. The Personal Insurance segment offers property and casualty insurance covering personal risks, primarily automobile and homeowners’ insurance to individuals through independent agencies and brokers. The Travelers Companies, Inc. was founded in 1853 and is based in New York, New York.

About Willis Towers Watson Public

Willis Towers Watson Public Limited Company operates as an advisory, broking, and solutions company worldwide. It operates through two segments: Health, Wealth & Career and Risk & Broking. The company offers strategy and design consulting, plan management service and support, broking and administration services for health, wellbeing, and other group benefit program, including medical, dental, disability, life, voluntary benefits and other coverages; actuarial support, plan design, and administrative services for pension and retirement savings plans; retirement consulting services and solutions; and integrated solutions that consists of investment discretionary management, pension administration, core actuarial, and communication and change management assistance services. It also provides advice, data, software, and products to address clients' total rewards and talent issues; and risk advice, insurance brokerage, and consulting services in the areas of property and casualty, affinity, risk and analytics, aerospace, construction, global markets direct & facultative, financial, executive and professional risks, financial solutions, crisis management, surety, marine, and natural resources. In addition, the company offers integrated solutions that consists of investment discretionary management, pension administration, core actuarial, and communication and change management assistance services; and software and technology, risk and capital management, products and product pricing, financial and regulatory reporting, financial and capital modeling, M&A, outsourcing, and business management services. The company was formerly known as Willis Group Holdings Public Limited Company and changed its name to Willis Towers Watson Public Limited Company in January 2016. Willis Towers Watson Public Limited Company was founded in 1828 and is based in London, the United Kingdom.