MARSH & MCLENNAN COS (MMC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MMC - US5717481023 - Common Stock
186.01 USD
-0.89 (-0.48%)
186.01 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to MMC. MMC was compared to 146 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.
In the past year MMC had a positive cash flow from operations.
In the past 5 years MMC has always 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 90.54% of its industry peers.
MMC has a Return On Equity of 27.24%. This is amongst the best in the industry. MMC outperforms 93.24% of its industry peers.
The Return On Invested Capital of MMC (13.33%) is better than 95.95% of its industry peers.
The Average Return On Invested Capital over the past 3 years for MMC is in line with the industry average of 15.11%.
| 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 has a Profit Margin of 15.60%. This is in the better half of the industry: MMC outperforms 79.73% of its industry peers.
MMC's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 25.20%, MMC belongs to the top of the industry, outperforming 87.16% of the companies in the same industry.
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
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.
The debt/assets ratio for MMC is higher compared to a year ago.
2.2 Solvency
MMC has an Altman-Z score of 2.77. 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 2.77 is amongst the best of the industry. MMC outperforms 94.59% 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.
Looking at the Debt to Equity ratio, with a value of 1.21, MMC is doing worse than 89.19% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.21 | ||
| Debt/FCF | 4.06 | ||
| Altman-Z | 2.77 |
ROIC/WACC1.69
WACC7.87%
2.3 Liquidity
A Current Ratio of 1.12 indicates that MMC should not have too much problems paying its short term obligations.
With an excellent Current ratio value of 1.12, MMC belongs to the best of the industry, outperforming 81.76% of the companies in the same industry.
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 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.
The Revenue has grown by 10.47% in the past year. This is quite good.
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.
MMC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.03% yearly.
EPS Next Y10.18%
EPS Next 2Y8.77%
EPS Next 3Y8.9%
EPS Next 5Y9.82%
Revenue Next Year10.7%
Revenue Next 2Y7.81%
Revenue Next 3Y6.94%
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
MMC is valuated rather expensively with a Price/Earnings ratio of 19.58.
Compared to the rest of the industry, the Price/Earnings ratio of MMC indicates a slightly more expensive valuation: MMC is more expensive than 66.22% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of MMC to the average of the S&P500 Index (27.19), we can say MMC is valued slightly cheaper.
A Price/Forward Earnings ratio of 17.87 indicates a rather expensive valuation of MMC.
Based on the Price/Forward Earnings ratio, MMC is valued a bit more expensive than 66.22% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of MMC to the average of the S&P500 Index (23.92), we can say MMC is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.58 | ||
| Fwd PE | 17.87 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MMC is valued a bit more expensive than the industry average as 60.81% of the companies are valued more cheaply.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of MMC indicates a slightly more expensive valuation: MMC is more expensive than 60.81% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.89 | ||
| EV/EBITDA | 14.33 |
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)1.92
PEG (5Y)1.44
EPS Next 2Y8.77%
EPS Next 3Y8.9%
5. Dividend
5.1 Amount
MMC has a Yearly Dividend Yield of 1.93%. Purely for dividend investing, there may be better candidates out there.
MMC's Dividend Yield is comparable with the industry average which is at 2.42.
Compared to an average S&P500 Dividend Yield of 1.92, MMC has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.93% |
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 their dividend for at least 10 years, which is a reliable track record.
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.
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 3Y8.9%
186.01
-0.89 (-0.48%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners91.61%
Inst Owner Change0%
Ins Owners0.06%
Ins Owner Change0.1%
Market Cap91.13B
Revenue(TTM)26.45B
Net Income(TTM)4.13B
Analysts67.86
Price Target215.43 (15.82%)
Short Float %1.07%
Short Ratio1.81
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.93% |
Yearly Dividend3.08
Dividend Growth(5Y)11.74%
DP40.17%
Div Incr Years15
Div Non Decr Years19
Ex-DateN/A
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)-0.24%
PT rev (3m)-8.71%
EPS NQ rev (1m)-0.16%
EPS NQ rev (3m)-0.71%
EPS NY rev (1m)-0.01%
EPS NY rev (3m)0.38%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)-1.14%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-0.2%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.58 | ||
| Fwd PE | 17.87 | ||
| P/S | 3.44 | ||
| P/FCF | 18.89 | ||
| P/OCF | 17.91 | ||
| P/B | 6.01 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.33 |
EPS(TTM)9.5
EY5.11%
EPS(NY)10.41
Fwd EY5.6%
FCF(TTM)9.85
FCFY5.29%
OCF(TTM)10.38
OCFY5.58%
SpS54
BVpS30.93
TBVpS-27.49
PEG (NY)1.92
PEG (5Y)1.44
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 | 2.77 |
F-Score4
WACC7.87%
ROIC/WACC1.69
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 Y10.18%
EPS Next 2Y8.77%
EPS Next 3Y8.9%
EPS Next 5Y9.82%
Revenue 1Y (TTM)10.47%
Revenue growth 3Y7.26%
Revenue growth 5Y7.99%
Sales Q2Q%11.48%
Revenue Next Year10.7%
Revenue Next 2Y7.81%
Revenue Next 3Y6.94%
Revenue Next 5Y6.03%
EBIT growth 1Y9.39%
EBIT growth 3Y12.14%
EBIT growth 5Y15.58%
EBIT Next Year23.99%
EBIT Next 3Y12.57%
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.
What is the valuation status of MARSH & MCLENNAN COS (MMC) stock?
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.
What is the earnings growth outlook for MARSH & MCLENNAN COS?
The Earnings per Share (EPS) of MARSH & MCLENNAN COS (MMC) is expected to grow by 10.18% in the next year.
Is the dividend of MARSH & MCLENNAN COS sustainable?
The dividend rating of MARSH & MCLENNAN COS (MMC) is 5 / 10 and the dividend payout ratio is 40.17%.