Analyzing Bowhead Specialty (NYSE:BOW) and Travelers Companies (NYSE:TRV)

Bowhead Specialty (NYSE:BOW) and Travelers Companies (NYSE:TRV) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, risk, earnings, profitability, valuation, analyst recommendations and institutional ownership.

Valuation and Earnings

This table compares Bowhead Specialty and Travelers Companies”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bowhead Specialty	$425.66 million	1.92	$38.24 million	$1.47	17.00
Travelers Companies	$46.42 billion	1.27	$5.00 billion	$25.43	10.42

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

Risk & Volatility

Bowhead Specialty has a beta of -0.88, suggesting that its share price is 188% less volatile than the S&P 500. Comparatively, Travelers Companies has a beta of 0.51, suggesting that its share price is 49% less volatile than the S&P 500.

Profitability

This table compares Bowhead Specialty and Travelers Companies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bowhead Specialty	10.05%	13.25%	2.94%
Travelers Companies	12.14%	20.28%	4.31%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Bowhead Specialty and Travelers Companies, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bowhead Specialty	0	4	5	0	2.56
Travelers Companies	1	11	6	1	2.37

Bowhead Specialty currently has a consensus target price of $35.67, suggesting a potential upside of 42.71%. Travelers Companies has a consensus target price of $291.31, suggesting a potential upside of 9.92%. Given Bowhead Specialty’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Bowhead Specialty is more favorable than Travelers Companies.

Insider and Institutional Ownership

82.5% of Travelers Companies shares are owned by institutional investors. 1.5% of Travelers Companies shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

Travelers Companies beats Bowhead Specialty on 11 of the 15 factors compared between the two stocks.

About Bowhead Specialty

Bowhead Specialty Holdings Inc. provides specialty property and casualty insurance products in the United States. It underwrites casualty insurance solutions for risks in the construction, distribution, heavy manufacturing, real estate, and hospitality segments; professional liability insurance solutions for financial institutions, private and public directors and officers liability insurance, errors and omissions liability insurance, and cyber segments; and healthcare solutions for hospitals, senior care providers, managed care organizations, miscellaneous medical facilities, and healthcare management liability segments. The company distributes its products through distribution partners in wholesale and retail markets. Bowhead Specialty Holdings Inc. was formerly known as Bowhead Holdings Inc. and changed its name to Bowhead Specialty Holdings Inc. in March 2024. The company was founded in 2020 and is based in New York, New York. Bowhead Specialty Holdings Inc. operates as a subsidiary of Bowhead Insurance Holdings LP.

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.