MARSH & MCLENNAN COS (MMC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MMC - US5717481023 - Common Stock
183.45 USD
+0.75 (+0.41%)
183.45 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 valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
MMC had positive earnings in the past year.
In the past year MMC had a positive cash flow from operations.
Each year in the past 5 years MMC has been profitable.
Each year in the past 5 years MMC had a positive operating cash flow.
1.2 Ratios
MMC's Return On Assets of 7.02% is amongst the best of the industry. MMC outperforms 91.16% of its industry peers.
With an excellent Return On Equity value of 27.24%, MMC belongs to the best of the industry, outperforming 91.84% of the companies in the same industry.
MMC's Return On Invested Capital of 13.33% is amongst the best of the industry. MMC outperforms 96.60% of its industry peers.
The Average Return On Invested Capital over the past 3 years for MMC is significantly above the industry average of 4.52%.
| 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
With a decent Profit Margin value of 15.60%, MMC is doing good in the industry, outperforming 79.59% of the companies in the same industry.
MMC's Profit Margin has improved in the last couple of years.
MMC has a Operating Margin of 25.20%. This is amongst the best in the industry. MMC outperforms 88.44% of its industry peers.
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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), MMC is creating some value.
The number of shares outstanding for MMC remains at a similar level compared to 1 year ago.
Compared to 5 years ago, MMC has less shares outstanding
The debt/assets ratio for MMC is higher compared to a year ago.
2.2 Solvency
MMC has an Altman-Z score of 2.75. 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 2.75 is amongst the best of the industry. MMC outperforms 91.84% of its industry peers.
MMC has a debt to FCF ratio of 4.06. This is a neutral value as MMC would need 4.06 years to pay back of 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 has a worse Debt to Equity ratio (1.21) than 89.80% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.21 | ||
| Debt/FCF | 4.06 | ||
| Altman-Z | 2.75 |
ROIC/WACC1.73
WACC7.72%
2.3 Liquidity
A Current Ratio of 1.12 indicates that MMC should not have too much problems paying its short term obligations.
MMC has a better Current ratio (1.12) than 80.95% of its industry peers.
MMC has a Quick 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.
The Quick ratio of MMC (1.12) is better than 80.95% 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.
The Earnings Per Share has been growing by 13.56% on average over the past years. This is quite good.
The Revenue has grown by 10.47% in the past year. This is quite good.
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.
MMC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.03% yearly.
EPS Next Y10.2%
EPS Next 2Y8.93%
EPS Next 3Y8.92%
EPS Next 5Y9.82%
Revenue Next Year10.71%
Revenue Next 2Y7.84%
Revenue Next 3Y6.95%
Revenue Next 5Y6.03%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
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
The Price/Earnings ratio is 19.31, which indicates a rather expensive current valuation of MMC.
Based on the Price/Earnings ratio, MMC is valued a bit more expensive than the industry average as 69.39% of the companies are valued more cheaply.
MMC is valuated rather cheaply when we compare the Price/Earnings ratio to 26.31, which is the current average of the S&P500 Index.
MMC is valuated rather expensively with a Price/Forward Earnings ratio of 17.57.
Based on the Price/Forward Earnings ratio, MMC is valued a bit more expensive than 68.03% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of MMC to the average of the S&P500 Index (36.59), we can say MMC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.31 | ||
| Fwd PE | 17.57 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MMC is valued a bit more expensive than the industry average as 60.54% of the companies are valued more cheaply.
MMC's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. MMC is more expensive than 61.90% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.63 | ||
| EV/EBITDA | 14.12 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of MMC may justify a higher PE ratio.
PEG (NY)1.89
PEG (5Y)1.42
EPS Next 2Y8.93%
EPS Next 3Y8.92%
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 3.46, MMC has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.40, MMC has a dividend comparable with the average S&P500 company.
| 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 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 2Y8.93%
EPS Next 3Y8.92%
183.45
+0.75 (+0.41%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners92.4%
Inst Owner Change-0.64%
Ins Owners0.06%
Ins Owner Change0.29%
Market Cap89.87B
Revenue(TTM)26.45B
Net Income(TTM)4.13B
Analysts67.69
Price Target218.4 (19.05%)
Short Float %1.17%
Short Ratio2.02
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)-7.45%
PT rev (3m)-7.45%
EPS NQ rev (1m)-0.03%
EPS NQ rev (3m)-1.05%
EPS NY rev (1m)0.13%
EPS NY rev (3m)0.25%
Revenue NQ rev (1m)-0.41%
Revenue NQ rev (3m)-1.09%
Revenue NY rev (1m)-0.07%
Revenue NY rev (3m)-0.25%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.31 | ||
| Fwd PE | 17.57 | ||
| P/S | 3.4 | ||
| P/FCF | 18.63 | ||
| P/OCF | 17.67 | ||
| P/B | 5.93 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.12 |
EPS(TTM)9.5
EY5.18%
EPS(NY)10.44
Fwd EY5.69%
FCF(TTM)9.85
FCFY5.37%
OCF(TTM)10.38
OCFY5.66%
SpS54
BVpS30.93
TBVpS-27.49
PEG (NY)1.89
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 | 2.75 |
F-Score4
WACC7.72%
ROIC/WACC1.73
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 Y10.2%
EPS Next 2Y8.93%
EPS Next 3Y8.92%
EPS Next 5Y9.82%
Revenue 1Y (TTM)10.47%
Revenue growth 3Y7.26%
Revenue growth 5Y7.99%
Sales Q2Q%11.48%
Revenue Next Year10.71%
Revenue Next 2Y7.84%
Revenue Next 3Y6.95%
Revenue Next 5Y6.03%
EBIT growth 1Y9.39%
EBIT growth 3Y12.14%
EBIT growth 5Y15.58%
EBIT Next Year25.69%
EBIT Next 3Y13.16%
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 19.31 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.