dropped more than 6% after the insurer reported weaker-than-expected quarterly earnings. The stock was on pace for its biggest one-day drop since Aug. 8, 2011, when it fell 7.6%., which flopped around the flatline for most of the morning as Wall Street grappled with a deluge of corporate earnings results. Excluding Travelers decline, the Dow would be up more than 100 points.
Travelers posted third-quarter earnings of $1.43 per share, well below a Refinitiv estimate of $2.35 per share. Travelers earnings suffered in large part because the company set aside more than $290 million in reserves for lawsuits. The reserves were driven by a $220 million asbestos charge, higher general liability and commercial auto losses.
"We believe most investors expected reserve development for asbestos and commercial auto lines of business, but the commentary around the difficult tort environment spreading to general liability is concerning," said Sandler O'Neill analyst Paul Newsome in a note. Newsome noted, however, that price increases remain strong for the company. "The question comes down to whether the price increases taken will be enough to improve the underlying underwriting margin into 2020."
Travelers was one of just a few companies posting a weaker-than-forecast on Tuesday, but the stock had an outsized influence on the Dow
Time to replace it with another
United States United States Latest News, United States United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: Reuters - 🏆 2. / 97 Read more »
Source: Reuters - 🏆 2. / 97 Read more »