MARSH & MCLENNAN COS (MMC)
US5717481023 - Common Stock
We assign a fundamental rating of 6 out of 10 to MMC. MMC was compared to 140 industry peers in the Insurance industry. MMC has an excellent profitability rating, but 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.
MMC had a positive operating cash flow in the past year.
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
The Return On Assets of MMC (8.08%) is better than 97.12% of its industry peers.
MMC has a better Return On Equity (29.43%) than 94.24% of its industry peers.
The Return On Invested Capital of MMC (15.23%) is better than 98.56% of its industry peers.
The Average Return On Invested Capital over the past 3 years for MMC is significantly above the industry average of 4.29%.
The last Return On Invested Capital (15.23%) for MMC is above the 3 year average (13.51%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.08% | ||
| ROE | 29.43% | ||
| ROIC | 15.23% |
ROA(3y)7.96%
ROA(5y)7.11%
ROE(3y)29.45%
ROE(5y)26.57%
ROIC(3y)13.51%
ROIC(5y)11.84%
1.3 Margins
MMC has a Profit Margin of 16.82%. This is amongst the best in the industry. MMC outperforms 83.45% of its industry peers.
In the last couple of years the Profit Margin of MMC has grown nicely.
MMC has a better Operating Margin (25.45%) than 85.61% of its industry peers.
In the last couple of years the Operating Margin of MMC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.45% | ||
| PM (TTM) | 16.82% | ||
| GM | N/A |
OM growth 3Y8.44%
OM growth 5Y5.86%
PM growth 3Y12.17%
PM growth 5Y8.4%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
MMC has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, MMC has less shares outstanding
Compared to 5 years ago, MMC has less shares outstanding
MMC has a worse debt/assets ratio than last year.
2.2 Solvency
MMC has an Altman-Z score of 3.45. This indicates that MMC is financially healthy and has little risk of bankruptcy at the moment.
MMC has a Altman-Z score of 3.45. This is amongst the best in the industry. MMC outperforms 96.40% of its industry peers.
The Debt to FCF ratio of MMC is 3.41, which is a good value as it means it would take MMC, 3.41 years of fcf income to pay off all of its debts.
MMC has a Debt to FCF ratio of 3.41. This is comparable to the rest of the industry: MMC outperforms 41.01% of its industry peers.
A Debt/Equity ratio of 0.90 indicates that MMC is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.90, MMC is doing worse than 85.61% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.9 | ||
| Debt/FCF | 3.41 | ||
| Altman-Z | 3.45 |
ROIC/WACC1.8
WACC8.45%
2.3 Liquidity
A Current Ratio of 1.14 indicates that MMC should not have too much problems paying its short term obligations.
MMC's Current ratio of 1.14 is amongst the best of the industry. MMC outperforms 80.58% of its industry peers.
MMC has a Quick Ratio of 1.14. 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 (1.14) is better than 80.58% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.14 | ||
| Quick Ratio | 1.14 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.26% over the past year.
MMC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 12.62% yearly.
The Revenue has been growing slightly by 7.84% in the past year.
MMC shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.75% yearly.
EPS 1Y (TTM)12.26%
EPS 3Y16.61%
EPS 5Y12.62%
EPS Q2Q%10.88%
Revenue 1Y (TTM)7.84%
Revenue growth 3Y9.7%
Revenue growth 5Y8.75%
Sales Q2Q%5.85%
3.2 Future
Based on estimates for the next years, MMC will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.82% on average per year.
The Revenue is expected to grow by 5.02% on average over the next years.
EPS Next Y11.76%
EPS Next 2Y9.94%
EPS Next 3Y9.81%
EPS Next 5Y9.82%
Revenue Next Year6.84%
Revenue Next 2Y8.17%
Revenue Next 3Y7.43%
Revenue Next 5Y5.02%
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.
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
The Price/Earnings ratio is 26.00, which means the current valuation is very expensive for MMC.
Based on the Price/Earnings ratio, MMC is valued a bit more expensive than 69.06% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.53, MMC is valued at the same level.
MMC is valuated rather expensively with a Price/Forward Earnings ratio of 23.50.
70.50% of the companies in the same industry are cheaper than MMC, based on the Price/Forward Earnings ratio.
MMC's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26 | ||
| Fwd PE | 23.5 |
4.2 Price Multiples
MMC's Enterprise Value to EBITDA is on the same level as the industry average.
71.94% 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 | 29.16 | ||
| EV/EBITDA | 17.61 |
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.
The excellent profitability rating of MMC may justify a higher PE ratio.
PEG (NY)2.21
PEG (5Y)2.06
EPS Next 2Y9.94%
EPS Next 3Y9.81%
5. Dividend
5.1 Amount
MMC has a Yearly Dividend Yield of 1.47%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 4.25, MMC has a dividend in line with its industry peers.
MMC's Dividend Yield is slightly below the S&P500 average, which is at 2.22.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.47% |
5.2 History
The dividend of MMC is nicely growing with an annual growth rate of 10.54%!
MMC has been paying a dividend for at least 10 years, so it has a reliable track record.
MMC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.54%
Div Incr Years14
Div Non Decr Years18
5.3 Sustainability
MMC pays out 36.35% of its income as dividend. This is a sustainable payout ratio.
MMC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP36.35%
EPS Next 2Y9.94%
EPS Next 3Y9.81%
MARSH & MCLENNAN COS
NYSE:MMC (11/18/2024, 11:03:01 AM)
223.845
+1.71 (+0.77%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap109.93B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.47% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26 | ||
| Fwd PE | 23.5 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.21
PEG (5Y)2.06
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.08% | ||
| ROE | 29.43% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 25.45% | ||
| PM (TTM) | 16.82% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.9 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.14 | ||
| Quick Ratio | 1.14 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)12.26%
EPS 3Y16.61%
EPS 5Y
EPS Q2Q%
EPS Next Y11.76%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)7.84%
Revenue growth 3Y9.7%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y