Aon (AON) AI Stock Analysis

• Market Cap: $76.61B
• Dividend Yield: 0.77%
• Average Volume (3M): 1.63M
• Price to Earnings (P/E): 30.2
• Beta (1Y): 0.27
• Revenue Growth: 19.57%
• EPS Growth: -8.09%
• Country: US
• Employees: 60,000
• Sector: Financial
• Sector Strength: 87
• Industry: Insurance - Brokers
• EPS (TTM): 11.73
• Shares Outstanding: 215,939,910
• 10 Day Avg. Volume: 2,043,065
• 30 Day Avg. Volume: 1,630,668
• PEG Ratio: 22.32
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.36
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 14.08
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $410.69
• Price Target Upside: 15.76% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

Aon's strong financial performance, characterized by consistent growth and operational efficiency, is its greatest strength. However, technical analysis points to potential short-term challenges, and the valuation suggests the stock might be overvalued. The positive earnings call provides confidence in future performance, balancing out some risks.

Positive Factors

Innovative Practices

Aon is a pioneer in using data to innovate within the insurance industry.

Management Events

Aon will hold an analyst day, which is anticipated to be a positive event due to management's skill at promoting the company.

Strategic Growth

Encouraged by Aon's potential to reaccelerate growth as it deploys rising free cash flow on both repurchases and tuck-in M&A.

Negative Factors

Economic Conditions

Declining insurable risks, client cost driven behavior, and sector-specific weakness result from the overall weak economic conditions in the company's core lines of business.

Financial Performance

First-quarter cash EPS of $5.67 missed the $6.05 estimate.

Management Changes

The departure of Eric Andersen is viewed by some investors as the loss of talent that had helped propel Aon's stock price over the past decade.

Aon Business Overview & Revenue Model

Company Description

Aon plc is a leading global professional services firm that provides a broad range of risk, retirement, and health solutions. The company operates in sectors such as insurance brokerage, risk management, human resources consulting, and outsourcing services. Aon serves clients in more than 120 countries, offering specialized advice and solutions to help organizations manage risk, optimize benefits, and cultivate talent.

How the Company Makes Money

Aon makes money primarily through fees and commissions earned from its risk and insurance brokerage services, where it acts as an intermediary between clients and insurance carriers. The company also generates revenue from its consulting services in risk management, retirement, and health solutions, providing tailored advice and solutions to clients. Additionally, Aon derives income from its data and analytics services, which offer insights and tools to help clients make informed decisions about risk and benefit management. Partnerships with insurance companies and other financial institutions also play a significant role in Aon's revenue generation, as these relationships enable the company to offer a wide range of products and services to its clients.

Aon Financial Statement Overview

Summary

Aon demonstrates strong financial health with consistent revenue and profit growth, underpinned by robust operational efficiency. Despite concerns over leverage and negative equity, the company's ability to generate cash and maintain profitability mitigates these risks.

Income Statement

Aon has demonstrated strong revenue growth over the years, with a notable increase of approximately 31% from 2020 to TTM (Trailing-Twelve-Months). The gross profit margin is robust, consistently over 45%, highlighting efficient cost management and operational prowess. Net profit margins remain healthy, averaging around 16% in the latest periods, indicating effective control over expenses. Additionally, both EBIT and EBITDA margins are strong, reflecting a solid operational backbone and consistent earnings power.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio primarily due to negative equity in recent years, which poses a potential risk. However, Aon has displayed a positive return on equity (ROE) in TTM, indicative of efficient management despite leverage concerns. The equity ratio is low, reflecting a reliance on debt, but the company maintains a stable asset base, which supports its operations.

Cash Flow

Aon's cash flow metrics reveal a strong capability to generate cash from operations, with a positive growth trend in free cash flow. The operating cash flow to net income ratio is consistently above 1, indicating that earnings are backed by cash. However, fluctuations in financing cash flows suggest strategic financial maneuvers, possibly to manage the debt levels.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
15.70B	13.38B	12.48B	12.19B	11.07B
	Gross Profit
7.42B	6.47B	6.00B	5.46B	5.16B
	EBIT
3.83B	3.79B	3.67B	2.09B	2.78B
	EBITDA
4.94B	3.91B	3.83B	2.58B	3.21B
	Net Income Common Stockholders
2.65B	2.56B	2.59B	1.25B	1.97B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.30B	1.15B	1.14B	836.00M	1.19B
	Total Assets
48.97B	33.96B	32.70B	31.93B	32.11B
	Total Debt
17.70B	12.03B	11.46B	10.16B	8.63B
	Net Debt
16.62B	11.25B	10.77B	9.62B	7.74B
	Total Liabilities
42.53B	34.70B	33.13B	30.77B	28.52B
	Stockholders Equity
6.12B	-826.00M	-529.00M	1.06B	3.50B
Cash Flow		Free Cash Flow
2.82B	3.18B	3.02B	2.04B	2.64B
	Operating Cash Flow
3.04B	3.44B	3.22B	2.18B	2.78B
	Investing Cash Flow
-2.83B	-188.00M	-449.00M	49.00M	-679.00M
	Financing Cash Flow
796.00M	-2.87B	-1.79B	-1.92B	-2.09B

Aon Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 354.79
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AON, the sentiment is Negative. The current price of 354.79 is below the 20-day moving average (MA) of 367.77, below the 50-day MA of 385.61, and below the 200-day MA of 362.11, indicating a bearish trend. The MACD of -10.14 indicates Positive momentum. The RSI at 41.71 is Neutral, neither overbought nor oversold. The STOCH value of 45.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AON.

Aon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BRO	77 Outperform	$32.93B	33.26	16.18%	0.52%	12.57%	10.52%
MMC	73 Outperform	$115.01B	28.51	30.51%	1.42%	7.56%	3.39%
ERIE	72 Outperform	$16.18B	29.80	32.38%	1.43%	15.05%	26.80%
AJG	71 Outperform	$82.81B	49.81	9.46%	0.77%	15.21%	46.99%
AON	69 Neutral	$76.61B	30.23	74.17%	0.77%	19.57%	-8.09%
WTW	65 Neutral	$30.06B	―	-0.60%	1.18%	2.42%	-103.64%
Sector *	63 Neutral	$12.46B	9.55	8.14%	17103.96%	12.70%	-4.66%

Aon Corporate Events

Aon Board Member Fulvio Conti Announces Retirement

On April 7, 2025, Fulvio Conti announced his decision to retire from Aon plc’s Board of Directors after more than 15 years of service, effective following the 2025 Annual General Meeting. His departure is not due to any disagreements with the company’s operations, policies, or practices. The company expressed gratitude for his valuable contributions, particularly in international business and finance, highlighting the impact of his insights on the board’s operations.

Spark’s Take on AON Stock

According to Spark, TipRanks’ AI Analyst, AON is a Outperform.

Aon’s overall stock score reflects strong financial performance and positive guidance from the earnings call, indicating robust operational capabilities and strategic execution. However, the high leverage on the balance sheet and relatively high valuation metrics temper the score. Technical indicators suggest bullish momentum but highlight potential risks of overbought conditions. The valuation concerns and market volatility challenges are notable factors impacting the score.

To see Spark’s full report on AON stock, click here.

Aon Announces Leadership Transition with New President

On March 14, 2025, Eric Andersen transitioned from his role as President of Aon plc to become a Senior Advisor, while CEO Gregory C. Case took on the additional title of President. Andersen, who joined Aon in 1997, played a pivotal role in advancing the firm’s Aon United strategy, integrating its Risk Capital and Human Capital capabilities, and operationalizing the 3×3 Plan to better serve clients. His leadership has been instrumental in strengthening Aon’s offerings and analytics, contributing significantly to the firm’s ability to deliver value to clients. Andersen expressed gratitude for his nearly three-decade tenure at Aon and looks forward to the firm’s continued growth and success.

Aon Announces Leadership Transition with Key Role Changes

On March 13, 2025, Aon plc announced a leadership transition with Michael Neller moving from his role as Chief Accounting Officer and Global Controller to become the Deputy Global Chief People Officer, focusing on Total Rewards and Talent Development. The company is initiating a search for a new Chief Accounting Officer and Global Controller, with Neller continuing in his current role until a successor is appointed, indicating a strategic shift in leadership roles that may impact the company’s operational focus and talent management strategies.