MARSH & MCLENNAN COS (MMC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MMC - US5717481023 - Common Stock
181.82 USD
-1.38 (-0.75%)
181.82 USD
0 (0%)
Taking everything into account, MMC scores 5 out of 10 in our fundamental rating. MMC was compared to 147 industry peers in the Insurance industry. While MMC has a great profitability rating, there are some minor concerns on its financial health. MMC is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year MMC was profitable.
MMC had a positive operating cash flow in the past year.
Each year in the past 5 years MMC has been profitable.
In the past 5 years MMC always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 7.02%, MMC belongs to the top of the industry, outperforming 91.22% of the companies in the same industry.
MMC's Return On Equity of 27.24% is amongst the best of the industry. MMC outperforms 93.24% of its industry peers.
With an excellent Return On Invested Capital value of 13.33%, MMC belongs to the best of the industry, outperforming 95.95% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for MMC is in line with the industry average of 14.89%.
| 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
Looking at the Profit Margin, with a value of 15.60%, MMC belongs to the top of the industry, outperforming 80.41% of the companies in the same industry.
MMC's Profit Margin has improved in the last couple of years.
MMC has a better Operating Margin (25.20%) than 88.51% of its industry peers.
MMC's Operating Margin has improved in the last couple of years.
| 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
MMC has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for MMC remains at a similar level compared to 1 year ago.
The number of shares outstanding for MMC has been reduced compared to 5 years ago.
The debt/assets ratio for MMC is higher compared to a year ago.
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's Altman-Z score of 2.74 is amongst the best of the industry. MMC outperforms 92.57% 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.
MMC has a Debt to FCF ratio of 4.06. This is comparable to the rest of the industry: MMC outperforms 42.57% of its industry peers.
A Debt/Equity ratio of 1.21 is on the high side and indicates that MMC has dependencies on debt financing.
MMC has a worse Debt to Equity ratio (1.21) than 90.54% 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 81.76% 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's Quick ratio of 1.12 is amongst the best of the industry. MMC outperforms 81.76% 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.
Measured over the past years, MMC shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.56% on average per year.
MMC shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.47%.
The Revenue has been growing slightly by 7.99% on average over the past years.
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.
The Revenue is expected to grow by 6.03% on average over the next years.
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 19.14 indicates a rather expensive valuation of MMC.
Based on the Price/Earnings ratio, MMC is valued a bit more expensive than the industry average as 67.57% of the companies are valued more cheaply.
MMC is valuated rather cheaply when we compare the Price/Earnings ratio to 26.49, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 17.47, which indicates a rather expensive current valuation of MMC.
Based on the Price/Forward Earnings ratio, MMC is valued a bit more expensive than the industry average as 66.89% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of MMC to the average of the S&P500 Index (23.69), we can say MMC is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.14 | ||
| Fwd PE | 17.47 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MMC indicates a slightly more expensive valuation: MMC is more expensive than 60.14% of the companies listed in the same industry.
62.84% of the companies in the same industry are cheaper than MMC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.46 | ||
| EV/EBITDA | 14.06 |
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)1.88
PEG (5Y)1.41
EPS Next 2Y8.77%
EPS Next 3Y8.86%
5. Dividend
5.1 Amount
MMC has a Yearly Dividend Yield of 1.97%. Purely for dividend investing, there may be better candidates out there.
MMC's Dividend Yield is comparable with the industry average which is at 3.48.
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
On average, the dividend of MMC grows each year by 11.74%, which is quite nice.
MMC has paid a dividend for at least 10 years, which is 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
40.17% of the earnings are spent on dividend by MMC. This is a bit on the high side, but may be sustainable.
The dividend of MMC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP40.17%
EPS Next 2Y8.77%
EPS Next 3Y8.86%
181.82
-1.38 (-0.75%)
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 Cap89.08B
Revenue(TTM)26.45B
Net Income(TTM)4.13B
Analysts67.41
Price Target215.95 (18.77%)
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 | 19.14 | ||
| Fwd PE | 17.47 | ||
| P/S | 3.37 | ||
| P/FCF | 18.46 | ||
| P/OCF | 17.51 | ||
| P/B | 5.88 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.06 |
EPS(TTM)9.5
EY5.22%
EPS(NY)10.41
Fwd EY5.73%
FCF(TTM)9.85
FCFY5.42%
OCF(TTM)10.38
OCFY5.71%
SpS54
BVpS30.93
TBVpS-27.49
PEG (NY)1.88
PEG (5Y)1.41
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 8 / 10.
Can you provide the PE and PB ratios for MMC stock?
The Price/Earnings (PE) ratio for MARSH & MCLENNAN COS (MMC) is 19.14 and the Price/Book (PB) ratio is 5.88.
How financially healthy is MARSH & MCLENNAN COS?
The financial health rating of MARSH & MCLENNAN COS (MMC) is 5 / 10.