Marsh & Mclennan Companies (MMC) AI Stock Analysis

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Marsh & Mclennan Companies

(NYSE:MMC)

Rating:67Neutral

Price Target:

$228.00

▲(10.62% Upside)

Marsh & McLennan Companies' strong financial performance is the primary driver of its stock score, showcasing robust profitability and growth. However, technical indicators suggest bearish momentum, limiting the score. Valuation appears moderate, and despite positive earnings outlook, macroeconomic challenges could impact future growth.

Positive Factors

Earnings

Second-quarter cash EPS of $2.72, up 11% year-over-year, beat analyst estimates.

Financial Performance

Free cash flow and FCF margins exceeded estimates, indicating strong cash generation capabilities.

Share Repurchase

Share repurchases of $300mn came in ahead of forecast.

Negative Factors

Consulting Segment Growth

Consulting segment reported organic growth decelerating from the prior quarter and missing forecast.

Growth Potential

Below-average near-term EPS growth potential leads to maintaining a Market Perform rating.

Revenue Growth

Volatile macro continues to weigh on organic growth.

Marsh & Mclennan Companies (MMC) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$101.33B

Dividend Yield1.63%

Average Volume (3M)2.35M

Price to Earnings (P/E)24.6

Beta (1Y)0.41

Revenue Growth9.22%

EPS Growth3.05%

CountryUS

Employees90,000

SectorFinancial

Sector Strength75

IndustryInsurance - Brokers

Share Statistics

EPS (TTM)2.72

Shares Outstanding491,624,050

10 Day Avg. Volume1,839,418

30 Day Avg. Volume2,351,225

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market Cap1.27

Enterprise Value/Revenue4.98

Enterprise Value/Gross Profit11.69

Enterprise Value/Ebitda17.76

Forecast

1Y Price Target

$232.94

Price Target Upside13.02% Upside

Rating ConsensusHold

Number of Analyst Covering17

Marsh & Mclennan Companies Business Overview & Revenue Model

Company DescriptionMarsh & McLennan Companies, Inc., a professional services company, provides advice and solutions to clients in the areas of risk, strategy, and people worldwide. It operates in two segments, Risk and Insurance Services, and Consulting. The Risk and Insurance Services segment offers risk management services, such as risk advice, risk transfer, and risk control and mitigation solutions, as well as insurance and reinsurance broking, catastrophe and financial modeling, and related advisory services; and insurance program management services. This segment serves businesses, public entities, insurance companies, associations, professional services organizations, and private clients. The Consulting segment provides health, wealth, and career consulting services and products; and specialized management, as well as economic and brand consulting services. Marsh & McLennan Companies, Inc. was founded in 1871 and is headquartered in New York, New York.

How the Company Makes MoneyMarsh & McLennan Companies generates revenue primarily through fees and commissions for its consulting and brokerage services. The core revenue streams include commission income from insurance placements and advisory fees from consulting services across its segments. Marsh, for instance, earns significant revenue by acting as an intermediary between clients and insurance carriers, receiving commissions on policies placed. Guy Carpenter earns revenue through reinsurance brokering services, while Mercer derives income from its health, retirement, and talent consulting services. Oliver Wyman contributes to revenue through management consulting engagements. Additionally, strategic partnerships with insurance companies and other service providers enhance MMC's service offerings and can lead to increased business opportunities, further solidifying its revenue base.

Marsh & Mclennan Companies Key Performance Indicators (KPIs)

Any

Risk and Insurance Revenue Breakdown

Risk and Insurance Revenue Breakdown
Details revenue from risk and insurance services, providing insight into the company's market position and growth in this critical area.

Chart InsightsMarsh & McLennan's Risk and Insurance segment shows robust growth, particularly in Marsh and Guy Carpenter, driven by a 15% revenue increase in the latest quarter. However, the earnings call highlights challenges like declining fiduciary interest income and softening insurance rates, which could impact future growth. Despite these hurdles, the company remains optimistic about mid-single-digit revenue growth and solid EPS gains in 2025, supported by strong international performance and strategic client guidance through a complex macro environment.

Data provided by:

Main Street Data

Marsh & Mclennan Companies Earnings Call Summary

Earnings Call Date:Jul 17, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Oct 16, 2025

Earnings Call Sentiment Neutral

Marsh & McLennan delivered strong revenue and EPS growth, supported by robust international performance and successful execution in a challenging macro environment. However, the company faces headwinds from a softening insurance market, a challenging U.S. litigation environment, and softness in project-related consulting work.

Q2-2025 Updates

Positive Updates

Strong Revenue Growth

Consolidated revenue increased 12% to $7 billion, with underlying growth of 4%. Adjusted operating income increased 14% year-over-year.

Adjusted EPS and Dividend Increase

Adjusted EPS grew 11% to $2.72, and the company announced a 10% increase to the quarterly dividend, marking the 16th consecutive year of dividend increases.

Strong International Performance

International growth was robust with EMEA up 8%, Asia Pacific up 4%, and Latin America up 3%.

Solid Performance of Guy Carpenter

Guy Carpenter's revenue grew 5% on an underlying basis, with strong growth across international platforms.

Negative Updates

Challenging U.S. Litigation Environment

Excessive litigation is increasing U.S. liability insurance costs, with nuclear verdicts growing 400% over the past decade.

Softening Insurance Market Rates

Overall insurance rates decreased 4% in the second quarter, following a 3% decline in the first quarter of 2025.

Decline in Fiduciary Interest Income

Fiduciary interest income was down $26 million compared to the second quarter last year, reflecting lower interest rates.

Softness in Project-Related Work in Consulting

The Career segment contracted 5%, primarily driven by reduced demand for project work in the U.S. and Canada.

Company Guidance

During the Marsh & McLennan earnings call for the second quarter of fiscal year 2025, the company reported a solid performance despite challenging macroeconomic conditions. The overall revenue grew by 12% to $7 billion, with underlying revenue increasing by 4%. Adjusted operating income rose by 14%, while the adjusted operating margin improved by 50 basis points to 29.5%. The adjusted earnings per share (EPS) increased by 11% to $2.72. The company also announced a 10% increase in its quarterly dividend to $0.90 and completed $300 million in share repurchases. The Risk and Insurance Services segment saw a revenue increase of 15% to $4.6 billion, with underlying growth of 4%, while the Consulting segment's revenue grew by 7% to $2.4 billion, with an underlying growth of 3%. Challenges such as declining property and casualty pricing and market uncertainty were highlighted, but the company remains optimistic about future growth, focusing on advising clients on strategies to build resilience and capture opportunities, particularly in the context of geopolitical risks and the rapid development of AI.

Marsh & Mclennan Companies Financial Statement Overview

Summary

Marsh & McLennan Companies showcases strong financial health with solid profitability and growth. The income statement is robust, supported by high margins and consistent revenue growth. The balance sheet shows manageable leverage and strong returns on equity. However, cash flow efficiency could improve, given the decline in free cash flow due to increased capital expenditures.

Income Statement

Very Positive

Marsh & Mclennan Companies demonstrates a strong income statement with commendable margins. The TTM (Trailing-Twelve-Months) gross profit margin stands at 42.56%, and net profit margin at 15.99%, indicating solid profitability. Additionally, the revenue growth rate from 2024 to TTM is 5.48%, showcasing a positive growth trajectory. The EBIT margin is robust at 23.58%, and the EBITDA margin at 27.12% further highlights operational efficiency. Overall, the company has shown consistent revenue and profit growth, maintaining high operational margins.

Balance Sheet

Positive

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 1.37, which is manageable within the industry context. The return on equity (ROE) for TTM is strong at 26.17%, indicating effective utilization of shareholder funds. The equity ratio is 26.93%, showing a balanced approach to financing with a mix of debt and equity. While the leverage is significant, the company appears to handle it well given its profitability and equity returns.

Cash Flow

Positive

The cash flow statement presents a healthy scenario with a free cash flow to net income ratio of 0.52 in the TTM, indicating good cash generation relative to net income. However, the operating cash flow to net income ratio is slightly lower at 0.58, suggesting room for improvement in cash conversion efficiency. The free cash flow growth rate of -46.37% from 2024 to TTM indicates a decline, partly due to increased capital expenditures, which could be a potential risk factor.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	25.80B	24.46B	22.74B	20.72B	19.82B	17.22B
Gross Profit	10.98B	10.46B	9.64B	8.65B	8.39B	7.09B
EBITDA	7.23B	6.93B	6.32B	5.27B	5.40B	4.05B
Net Income	4.13B	4.06B	3.76B	3.05B	3.14B	2.02B
Balance Sheet
Total Assets	58.55B	56.48B	48.03B	33.45B	34.39B	33.03B
Cash, Cash Equivalents and Short-Term Investments	1.68B	2.40B	3.36B	1.44B	1.75B	2.09B
Total Debt	21.61B	21.86B	15.44B	13.47B	13.16B	13.58B
Total Liabilities	42.58B	42.95B	35.66B	22.70B	23.17B	23.77B
Stockholders Equity	15.77B	13.34B	12.19B	10.52B	11.01B	9.10B
Cash Flow
Free Cash Flow	4.65B	3.99B	3.84B	3.00B	3.11B	3.03B
Operating Cash Flow	4.92B	4.30B	4.26B	3.46B	3.52B	3.38B
Investing Cash Flow	-8.13B	-8.82B	-1.42B	-850.00M	-1.16B	-793.00M
Financing Cash Flow	3.01B	4.46B	-1.12B	-1.05B	-1.30B	-925.00M

Marsh & Mclennan Companies Technical Analysis

Technical Analysis Sentiment

Negative

Last Price206.11

Price Trends

50DMA

208.39

Negative

100DMA

216.35

Negative

200DMA

219.80

Negative

Market Momentum

MACD

-0.53

Positive

RSI

46.39

Neutral

STOCH

16.30

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MMC, the sentiment is Negative. The current price of 206.11 is below the 20-day moving average (MA) of 206.93, below the 50-day MA of 208.39, and below the 200-day MA of 219.80, indicating a bearish trend. The MACD of -0.53 indicates Positive momentum. The RSI at 46.39 is Neutral, neither overbought nor oversold. The STOCH value of 16.30 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MMC.

Marsh & Mclennan Companies Risk Analysis

Marsh & Mclennan Companies disclosed 34 risk factors in its most recent earnings report. Marsh & Mclennan Companies reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Marsh & Mclennan Companies Peers Comparison

Overall Rating

UnderperformOutperform

Sector (68)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AON	78 Outperform	$80.20B	31.14	37.99%	0.76%	18.42%	-4.44%
BRO	76 Outperform	$31.48B	27.52	11.27%	0.63%	11.68%	-0.17%
AJG	75 Outperform	$77.58B	45.61	9.49%	0.85%	15.03%	28.86%
ERIE	70 Outperform	$15.74B	28.50	31.14%	1.60%	12.19%	17.82%
Sector *	68 Neutral	$18.05B	11.73	10.24%	3.73%	9.66%	1.70%
MMC	67 Neutral	$101.33B	24.64	28.33%	1.63%	9.22%	3.05%
WTW	65 Neutral	$31.75B	227.45	1.57%	1.09%	1.27%	-84.75%

* Financial Sector Average

Performance Comparison

MMC

Marsh & Mclennan Companies

206.11

-18.33

-8.17%

AON

Aon

373.49

28.19

8.16%

AJG

Arthur J Gallagher & Co

300.22

7.75

2.65%

BRO

Brown & Brown

95.49

-7.85

-7.60%

ERIE

Erie Indemnity Company

336.43

-163.24

-32.67%

WTW

Willis Towers Watson

329.84

42.10

14.63%

Marsh & Mclennan Companies Corporate Events

Executive/Board ChangesShareholder Meetings

Marsh & McLennan’s Annual Meeting Decisions Announced

Neutral

May 19, 2025

On May 15, 2025, Marsh & McLennan Companies held its Annual Meeting of Stockholders, where key decisions were made. The stockholders elected eleven directors for a one-year term, approved executive compensation, ratified Deloitte & Touche LLP as the independent auditor, and approved amendments to the 2020 Incentive and Stock Award Plan. These decisions reflect the company’s ongoing governance practices and commitment to aligning executive incentives with shareholder interests.

The most recent analyst rating on (MMC) stock is a Hold with a $220.00 price target. To see the full list of analyst forecasts on Marsh & Mclennan Companies stock, see the MMC Stock Forecast page.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 24, 2025