The Travelers Companies (TRV) is showing strong technical momentum, with a “buy” signal from Trend Seeker and a gain of 9.54% over the past month.

TRV trades at a trailing P/E of 11.01x, notably below the value line average of 19.50, suggesting that valuation remains attractive despite recent price highs.

Revenues are expected to grow modestly (2.01% this year, 2.90% next), although earnings are expected to decline slightly over the next two years.

I maintain a positive long-term outlook for TRV, citing its consistent growth in revenue, earnings and cash flow, and low short interest (1.72% of float).

Valued at $66.22 billion, The Travelers Companies TRV, a holding company, is primarily engaged, through its subsidiaries, in providing a wide variety of property and casualty insurance and surety products and services to businesses, organizations and individuals in the United States and select international markets. The Travelers’ Business Insurance segment offers a wide range of property and casualty insurance and insurance-related services to its customers primarily in the United States, as well as in Canada, the United Kingdom, the Republic of Ireland, Brazil and other parts of the world as a corporate member of Lloyd’s. Its products include workers’ compensation, auto and commercial property, general liability, commercial multiple risk, employers’ liability, public and product liability, professional indemnity, marine products, aviation, onshore and offshore energy, construction, terrorism, personal accident and kidnapping and rescue insurance.

I found today’s chart by using Barchart’s powerful selection features to rank stocks with the highest technical buy signals; superior current impulse in both strength and direction; and a “buy” signal from Trend Seeker. I then used Barchart’s Flipcharts feature to review the charts for a constant price appreciation. TRV ticks those boxes. Since the Trend Seeker issued a new “Buy” rating on February 4, the stock has risen 4.18%.

TRV (bar chart)

Editor’s note: The technical indicators below are updated live during the session every 20 minutes and therefore may change daily as the market fluctuates. Therefore, the indicator numbers shown below may not match what you see live in the Barchart.com website when you read this report. These technical indicators form Barchart’s opinion on a particular stock.

Travelers hit an all-time high of $309.37 on February 23.

• TRV has a weighted alpha of +22.17.

• Travelers have a 100% “Buy” opinion from Barchart.

• Shares are up 20.93% over the past 52 weeks.

• Travelers has its Trend Seeker “Buy” signal intact.

• Shares recently traded at $308.70 with a 50-day moving average of $289.64.

• TRV has made 9 new highs and is up 9.54% over the past month.

• The Relative Strength Index (RSI) is 69.57.

• There is a technical support level around $304.29.

• Market cap of $66.22 billion.

• 11.01 times trailing price-to-earnings ratio.

• Revenue is expected to grow 2.01% this year and another 2.90% next year.

• Revenue is estimated to decline by 1.29% this year and an additional 3.81% next year.

• Wall Street analysts followed by Barchart gave the stock 8 “strong buy”, 1 “moderate buy”, 18 “hold” and 2 “sell” ratings with price targets ranging from $259 to $340.

• Value Line rates the stock “Above Average” with price targets of $241-$415.

• CFRA’s MarketScope rates the stock a “Hold” with a price target of $295.

• Morningstar believes the stock is 23% overvalued with a fair value of $247.

• 1,242 investors following the Motley Fool think the stock will beat the market while 247 think it won’t.

• 33,710 investors are following the Seeking Alpha stock, rating it a “Hold”.

• Short interest is 1.72% of the float with 2.02 days to cover the float.

Although some analysts think that the recent price increase makes the stock overvalued, I disagree. In my 56 years of following the Stock Market I have found one rule that has always held true. In the long run, companies that continue to grow revenue, earnings and cash flow will increase in price. Those companies that have declines in revenue, earnings, and cash flow will have price declines. This company, over the years, has had continuous increases in revenue, earnings and cash flow. The only question is: is it overrated? According to Value Line, the price to earnings ratio of the earnings companies is 19.50, while the P/E ratio of Travelers is only 11.01.

Sophisticated Money: Entities shorting a stock only shorted 1.72% of the float.

Long-term investors should consider this stock.

Additional Disclosure: The daily bar chart highlights stocks that are experiencing exceptional appreciation from the current price. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. If you decide to add one of these stocks to your investment portfolio, we recommend that you follow a predetermined diversification and trailing stop loss discipline that is consistent with your personal tolerance for investment risk.

As of the date of publication, Jim Van Meerten had no positions (either directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. This article was originally published on Barchart.com