NYSE:MMC

Stock Analysis Report

Marsh & McLennan Companies

Executive Summary

Marsh & McLennan Companies, Inc., a professional services company, provides advice and solutions to clients in the areas of risk, strategy, and people worldwide.

Snowflake

Fundamentals

Established dividend payer with reasonable growth potential.


Similar Companies

Share Price & News

How has Marsh & McLennan Companies's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

2.7%

MMC

1.5%

US Insurance

2.3%

US Market


1 Year Return

21.4%

MMC

12.8%

US Insurance

5.6%

US Market

Return vs Industry: MMC exceeded the US Insurance industry which returned 12.8% over the past year.

Return vs Market: MMC exceeded the US Market which returned 5.6% over the past year.


Shareholder returns

MMCIndustryMarket
7 Day2.7%1.5%2.3%
30 Day-1.8%-1.5%-1.0%
90 Day-3.3%-2.6%-0.7%
1 Year23.7%21.4%15.6%12.8%7.9%5.6%
3 Year57.9%49.2%42.2%31.2%45.6%36.3%
5 Year112.4%92.3%72.0%51.5%65.8%47.6%

Price Volatility Vs. Market

How volatile is Marsh & McLennan Companies's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Marsh & McLennan Companies undervalued compared to its fair value and its price relative to the market?

33.61x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Undervalued: MMC ($98.2) is trading above our estimate of fair value ($87.33)

Significantly Undervalued: MMC is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: MMC is poor value based on its PE Ratio (33.6x) compared to the Insurance industry average (15.5x).

PE vs Market: MMC is poor value based on its PE Ratio (33.6x) compared to the US market (17.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: MMC is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: MMC is overvalued based on its PB Ratio (6.2x) compared to the US Insurance industry average (1.2x).


Next Steps

Future Growth

How is Marsh & McLennan Companies forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

21.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MMC's forecast earnings growth (21% per year) is above the savings rate (2.7%).

Earnings vs Market: MMC's earnings (21% per year) are forecast to grow faster than the US market (14.5% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: MMC's revenue (6.8% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: MMC's revenue (6.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: MMC's Return on Equity is forecast to be high in 3 years time (27.6%)


Next Steps

Past Performance

How has Marsh & McLennan Companies performed over the past 5 years?

2.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: MMC's earnings have grown by 2.2% per year over the past 5 years.

Accelerating Growth: MMC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: MMC had negative earnings growth (-10%) over the past year, making it difficult to compare to the Insurance industry average (3.1%).


Return on Equity

High ROE: MMC's Return on Equity (18.1%) is considered low.


Return on Assets

ROA vs Industry: MMC has a higher Return on Assets than the Insurance industry average last year.


Return on Capital Employed

ROCE Improving: MMC's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Marsh & McLennan Companies's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: MMC has a low level of unsold assets or inventory.

Debt Coverage by Assets: MMC's debt is not covered by short term assets (assets are 0.6x debt).


Financial Institutions Analysis

Asset Level: MMC's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if MMC has a sufficient allowance for bad loans.

Low Risk Liabilities: MMC reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if MMC has an acceptable proportion of non-loan assets held.

Low Risk Deposits: MMC has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if MMC has an appropriate level of bad loans.


Next Steps

Dividend

What is Marsh & McLennan Companies's current dividend yield, its reliability and sustainability?

1.85%

Current Dividend Yield


Dividend Yield vs Market

company1.9%marketbottom25%1.5%markettop25%3.8%industryaverage2.4%forecastin3Years1.9%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: MMC's dividend (1.85%) is higher than the bottom 25% of dividend payers in the US market (1.46%).

High Dividend: MMC's dividend (1.85%) is low compared to the top 25% of dividend payers in the US market (3.76%).

Stable Dividend: MMC's dividends per share have been stable in the past 10 years.

Growing Dividend: MMC's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (58.2%), MMC's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: MMC's dividends in 3 years are forecast to be well covered by earnings (37.6% payout ratio).


Next Steps

Management

What is the CEO of Marsh & McLennan Companies's salary, the management and board of directors tenure and is there insider trading?

3.0yrs

Average management tenure


CEO

Dan Glaser (59yo)

6.8yrs

Tenure

US$17,281,919

Compensation

Mr. Daniel S. Glaser, also known as Dan, has been the Chief Executive Officer and President of Marsh & McLennan Companies, Inc. since January 1, 2013. Mr. Glaser served as Interim Chairman and Chief Execut ...


CEO Compensation Analysis

Compensation vs. Market: Dan's total compensation ($USD17.28M) is about average for companies of similar size in the US market ($USD11.23M).

Compensation vs Earnings: Dan's compensation has been consistent with company performance over the past year.


Management Age and Tenure

3.0yrs

Average Tenure

58yo

Average Age

Experienced Management: MMC's management team is considered experienced (3 years average tenure).


Board Age and Tenure

8.4yrs

Average Tenure

67yo

Average Age

Experienced Board: MMC's board of directors are considered experienced (8.4 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown


Management Team

  • Julio Portalatin (60yo)

    Vice Chairman

    • Tenure: 0.6yrs
    • Compensation: US$5.98m
  • John Doyle (55yo)

    President & CEO of Marsh LLC

    • Tenure: 2.3yrs
    • Compensation: US$7.02m
  • Peter Hearn (63yo)

    President & CEO of Guy Carpenter

    • Tenure: 2.3yrs
    • Compensation: US$5.07m
  • Peter Beshar (57yo)

    Executive VP & General Counsel

    • Tenure: 14.9yrs
    • Compensation: US$5.21m
  • E. Gilbert (63yo)

    Senior VP & Chief Information Officer

    • Tenure: 4.1yrs
  • Mark McGivney (51yo)

    Chief Financial Officer

    • Tenure: 3.8yrs
    • Compensation: US$4.82m
  • Dan Glaser (59yo)

    President

    • Tenure: 6.8yrs
    • Compensation: US$17.28m
  • Keith Walsh

    CFO of the Risk & Insurance Services and CFO of Marsh

    • Tenure: 0yrs
  • Stacy Mills (54yo)

    VP, Controller & Chief Accounting Officer

    • Tenure: 1.8yrs
  • Sarah Dewitt

    Vice President of Investor Relations

    • Tenure: 0yrs

Board Members

  • R. Yost (71yo)

    Director

    • Tenure: 7.8yrs
    • Compensation: US$310.00k
  • Ed Hanway (67yo)

    Chairman of the Board

    • Tenure: 3.4yrs
    • Compensation: US$490.00k
  • Marc Oken (73yo)

    Director

    • Tenure: 13.8yrs
    • Compensation: US$290.00k
  • Bruce Nolop (68yo)

    Director

    • Tenure: 11.8yrs
    • Compensation: US$320.00k
  • Steven Mills (67yo)

    Director

    • Tenure: 8.4yrs
    • Compensation: US$315.00k
  • Óscar Fanjul Martín (70yo)

    Director

    • Tenure: 18.8yrs
    • Compensation: US$305.00k
  • Morton Schapiro (65yo)

    Director

    • Tenure: 17.8yrs
    • Compensation: US$305.00k
  • Lloyd Yates (58yo)

    Director

    • Tenure: 8.4yrs
    • Compensation: US$290.00k
  • Dan Glaser (59yo)

    President

    • Tenure: 6.8yrs
    • Compensation: US$17.28m
  • Alex Moczarski (63yo)

    Chairman of Marsh & McLennan Companies International

    • Tenure: 7.6yrs
    • Compensation: US$4.51m

Company Information

Marsh & McLennan Companies, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Marsh & McLennan Companies, Inc.
  • Ticker: MMC
  • Exchange: NYSE
  • Founded: 1871
  • Industry: Insurance Brokers
  • Sector: Insurance
  • Market Cap: US$49.720b
  • Shares outstanding: 506.31m
  • Website: https://www.mmc.com

Number of Employees


Location

  • Marsh & McLennan Companies, Inc.
  • 1166 Avenue of the Americas
  • New York
  • New York
  • 10036
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MMCNYSE (New York Stock Exchange)YesCommon StockUSUSDFeb 1968
MHMLSE (London Stock Exchange)YesCommon StockGBUSDFeb 1968
MSNDB (Deutsche Boerse AG)YesCommon StockDEEURFeb 1968

Biography

Marsh & McLennan Companies, Inc., a professional services company, provides advice and solutions to clients in the areas of risk, strategy, and people worldwide. It operates in two segments, Risk and Insur ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/16 23:38
End of Day Share Price2019/10/16 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.