MARSH & MCLENNAN COS (MMC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MMC - US5717481023 - Common Stock
183.47 USD
+2.54 (+1.4%)
183.47 USD
0 (0%)
MMC gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 147 industry peers in the Insurance industry. MMC has an excellent profitability rating, but there are some minor concerns on its financial health. While showing a medium growth rate, MMC is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year MMC was profitable.
In the past year MMC had a positive cash flow from operations.
MMC had positive earnings in each of the past 5 years.
Each year in the past 5 years MMC had a positive operating cash flow.
1.2 Ratios
MMC has a Return On Assets of 7.02%. This is amongst the best in the industry. MMC outperforms 90.48% of its industry peers.
The Return On Equity of MMC (27.24%) is better than 93.20% of its industry peers.
Looking at the Return On Invested Capital, with a value of 13.33%, MMC belongs to the top of the industry, outperforming 95.92% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for MMC is in line with the industry average of 14.90%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.02% | ||
| ROE | 27.24% | ||
| ROIC | 13.33% |
ROA(3y)7.31%
ROA(5y)7.43%
ROE(3y)30.08%
ROE(5y)28.19%
ROIC(3y)13.69%
ROIC(5y)12.5%
1.3 Margins
MMC's Profit Margin of 15.60% is fine compared to the rest of the industry. MMC outperforms 79.59% of its industry peers.
In the last couple of years the Profit Margin of MMC has grown nicely.
With an excellent Operating Margin value of 25.20%, MMC belongs to the best of the industry, outperforming 88.44% of the companies in the same industry.
In the last couple of years the Operating Margin of MMC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.2% | ||
| PM (TTM) | 15.6% | ||
| GM | N/A |
OM growth 3Y4.55%
OM growth 5Y7.02%
PM growth 3Y1.54%
PM growth 5Y9.67%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so MMC is still creating some value.
MMC has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for MMC has been reduced compared to 5 years ago.
MMC has a worse debt/assets ratio than last year.
2.2 Solvency
MMC has an Altman-Z score of 2.74. This is not the best score and indicates that MMC is in the grey zone with still only limited risk for bankruptcy at the moment.
MMC has a Altman-Z score of 2.74. This is amongst the best in the industry. MMC outperforms 92.52% of its industry peers.
The Debt to FCF ratio of MMC is 4.06, which is a neutral value as it means it would take MMC, 4.06 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 4.06, MMC perfoms like the industry average, outperforming 42.18% of the companies in the same industry.
MMC has a Debt/Equity ratio of 1.21. This is a high value indicating a heavy dependency on external financing.
MMC's Debt to Equity ratio of 1.21 is on the low side compared to the rest of the industry. MMC is outperformed by 90.48% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.21 | ||
| Debt/FCF | 4.06 | ||
| Altman-Z | 2.74 |
ROIC/WACC1.71
WACC7.81%
2.3 Liquidity
MMC has a Current Ratio of 1.12. This is a normal value and indicates that MMC is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.12, MMC belongs to the top of the industry, outperforming 81.63% of the companies in the same industry.
A Quick Ratio of 1.12 indicates that MMC should not have too much problems paying its short term obligations.
MMC has a better Quick ratio (1.12) than 81.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.12 |
3. Growth
3.1 Past
MMC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.34%, which is quite good.
MMC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.56% yearly.
MMC shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.47%.
Measured over the past years, MMC shows a small growth in Revenue. The Revenue has been growing by 7.99% on average per year.
EPS 1Y (TTM)10.34%
EPS 3Y12.5%
EPS 5Y13.56%
EPS Q2Q%13.5%
Revenue 1Y (TTM)10.47%
Revenue growth 3Y7.26%
Revenue growth 5Y7.99%
Sales Q2Q%11.48%
3.2 Future
The Earnings Per Share is expected to grow by 9.82% on average over the next years. This is quite good.
Based on estimates for the next years, MMC will show a small growth in Revenue. The Revenue will grow by 6.03% on average per year.
EPS Next Y10.19%
EPS Next 2Y8.77%
EPS Next 3Y8.86%
EPS Next 5Y9.82%
Revenue Next Year10.72%
Revenue Next 2Y7.83%
Revenue Next 3Y6.93%
Revenue Next 5Y6.03%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 19.31 indicates a rather expensive valuation of MMC.
Based on the Price/Earnings ratio, MMC is valued a bit more expensive than 68.03% of the companies in the same industry.
MMC's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.76.
A Price/Forward Earnings ratio of 17.62 indicates a rather expensive valuation of MMC.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MMC indicates a slightly more expensive valuation: MMC is more expensive than 66.67% of the companies listed in the same industry.
MMC's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.96.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.31 | ||
| Fwd PE | 17.62 |
4.2 Price Multiples
61.90% of the companies in the same industry are cheaper than MMC, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, MMC is valued a bit more expensive than 63.27% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.63 | ||
| EV/EBITDA | 14 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates MMC does not grow enough to justify the current Price/Earnings ratio.
MMC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.9
PEG (5Y)1.42
EPS Next 2Y8.77%
EPS Next 3Y8.86%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.97%, MMC has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.48, MMC has a dividend in line with its industry peers.
MMC's Dividend Yield is comparable with the S&P500 average which is at 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.97% |
5.2 History
The dividend of MMC is nicely growing with an annual growth rate of 11.74%!
MMC has been paying a dividend for at least 10 years, so it has a reliable track record.
MMC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)11.74%
Div Incr Years15
Div Non Decr Years19
5.3 Sustainability
MMC pays out 40.17% of its income as dividend. This is a bit on the high side, but may be sustainable.
MMC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP40.17%
EPS Next 2Y8.77%
EPS Next 3Y8.86%
183.47
+2.54 (+1.4%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners91.62%
Inst Owner Change-0.61%
Ins Owners0.06%
Ins Owner Change0.1%
Market Cap89.88B
Revenue(TTM)26.45B
Net Income(TTM)4.13B
Analysts67.41
Price Target215.95 (17.7%)
Short Float %1.11%
Short Ratio1.88
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.97% |
Yearly Dividend3.08
Dividend Growth(5Y)11.74%
DP40.17%
Div Incr Years15
Div Non Decr Years19
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.98%
Min EPS beat(2)1.3%
Max EPS beat(2)2.66%
EPS beat(4)4
Avg EPS beat(4)2.44%
Min EPS beat(4)0.36%
Max EPS beat(4)5.46%
EPS beat(8)6
Avg EPS beat(8)1.69%
EPS beat(12)10
Avg EPS beat(12)2.13%
EPS beat(16)14
Avg EPS beat(16)2.17%
Revenue beat(2)0
Avg Revenue beat(2)-0.42%
Min Revenue beat(2)-0.55%
Max Revenue beat(2)-0.29%
Revenue beat(4)1
Avg Revenue beat(4)-0.28%
Min Revenue beat(4)-1.3%
Max Revenue beat(4)1.03%
Revenue beat(8)2
Avg Revenue beat(8)-0.62%
Revenue beat(12)4
Avg Revenue beat(12)-0.51%
Revenue beat(16)5
Avg Revenue beat(16)-0.41%
PT rev (1m)-2.91%
PT rev (3m)-8.49%
EPS NQ rev (1m)-0.03%
EPS NQ rev (3m)-0.79%
EPS NY rev (1m)-0.01%
EPS NY rev (3m)0.24%
Revenue NQ rev (1m)-0.12%
Revenue NQ rev (3m)-1.21%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.25%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.31 | ||
| Fwd PE | 17.62 | ||
| P/S | 3.4 | ||
| P/FCF | 18.63 | ||
| P/OCF | 17.67 | ||
| P/B | 5.93 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14 |
EPS(TTM)9.5
EY5.18%
EPS(NY)10.41
Fwd EY5.67%
FCF(TTM)9.85
FCFY5.37%
OCF(TTM)10.38
OCFY5.66%
SpS54
BVpS30.93
TBVpS-27.49
PEG (NY)1.9
PEG (5Y)1.42
Graham Number81.31
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.02% | ||
| ROE | 27.24% | ||
| ROCE | 17.69% | ||
| ROIC | 13.33% | ||
| ROICexc | 14.28% | ||
| ROICexgc | 76.66% | ||
| OM | 25.2% | ||
| PM (TTM) | 15.6% | ||
| GM | N/A | ||
| FCFM | 18.24% |
ROA(3y)7.31%
ROA(5y)7.43%
ROE(3y)30.08%
ROE(5y)28.19%
ROIC(3y)13.69%
ROIC(5y)12.5%
ROICexc(3y)14.92%
ROICexc(5y)13.56%
ROICexgc(3y)71.76%
ROICexgc(5y)60.83%
ROCE(3y)18.16%
ROCE(5y)16.58%
ROICexgc growth 3Y14.51%
ROICexgc growth 5Y14.25%
ROICexc growth 3Y1.96%
ROICexc growth 5Y7.02%
OM growth 3Y4.55%
OM growth 5Y7.02%
PM growth 3Y1.54%
PM growth 5Y9.67%
GM growth 3YN/A
GM growth 5YN/A
F-Score4
Asset Turnover0.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.21 | ||
| Debt/FCF | 4.06 | ||
| Debt/EBITDA | 2.43 | ||
| Cap/Depr | 29.67% | ||
| Cap/Sales | 0.99% | ||
| Interest Coverage | 8.05 | ||
| Cash Conversion | 67.4% | ||
| Profit Quality | 116.91% | ||
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.12 | ||
| Altman-Z | 2.74 |
F-Score4
WACC7.81%
ROIC/WACC1.71
Cap/Depr(3y)56.15%
Cap/Depr(5y)53.95%
Cap/Sales(3y)1.82%
Cap/Sales(5y)1.91%
Profit Quality(3y)99.4%
Profit Quality(5y)109.53%
High Growth Momentum
Growth
EPS 1Y (TTM)10.34%
EPS 3Y12.5%
EPS 5Y13.56%
EPS Q2Q%13.5%
EPS Next Y10.19%
EPS Next 2Y8.77%
EPS Next 3Y8.86%
EPS Next 5Y9.82%
Revenue 1Y (TTM)10.47%
Revenue growth 3Y7.26%
Revenue growth 5Y7.99%
Sales Q2Q%11.48%
Revenue Next Year10.72%
Revenue Next 2Y7.83%
Revenue Next 3Y6.93%
Revenue Next 5Y6.03%
EBIT growth 1Y9.39%
EBIT growth 3Y12.14%
EBIT growth 5Y15.58%
EBIT Next Year24.64%
EBIT Next 3Y12.7%
EBIT Next 5Y8.85%
FCF growth 1Y35.53%
FCF growth 3Y8.62%
FCF growth 5Y15.49%
OCF growth 1Y27.91%
OCF growth 3Y6.96%
OCF growth 5Y12.75%
MARSH & MCLENNAN COS / MMC FAQ
What is the fundamental rating for MMC stock?
ChartMill assigns a fundamental rating of 5 / 10 to MMC.
Can you provide the valuation status for MARSH & MCLENNAN COS?
ChartMill assigns a valuation rating of 2 / 10 to MARSH & MCLENNAN COS (MMC). This can be considered as Overvalued.
Can you provide the profitability details for MARSH & MCLENNAN COS?
MARSH & MCLENNAN COS (MMC) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for MMC stock?
The Price/Earnings (PE) ratio for MARSH & MCLENNAN COS (MMC) is 19.31 and the Price/Book (PB) ratio is 5.93.
How financially healthy is MARSH & MCLENNAN COS?
The financial health rating of MARSH & MCLENNAN COS (MMC) is 5 / 10.