Marsh & Mclennan Companies (MMC) AI Stock Analysis

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Marsh & Mclennan Companies

(NYSE:MMC)

Rating:67Neutral

Price Target:

$228.00

▲(9.45%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 Performance

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

Financial Health

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

Growth Initiatives

MMC's recent hiring spree is expected to boost organic growth and be supported by structural expense savings.

Negative Factors

Consulting Segment Performance

The more macro-sensitive Consulting segment reported organic growth of 3%, decelerating 200bps from 1Q25 and missing forecast.

Organic Growth Challenges

Volatile macro continues to weigh on organic growth.

Stock Performance

MMC's stock has underperformed compared to peers since its last results.

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

Market Cap

$103.14B

Dividend Yield1.61%

Average Volume (3M)2.46M

Price to Earnings (P/E)25.2

Beta (1Y)0.37

Revenue Growth9.22%

EPS Growth3.05%

CountryUS

Employees90,000

SectorFinancial

Sector Strength72

IndustryInsurance - Brokers

Share Statistics

EPS (TTM)2.72

Shares Outstanding491,624,050

10 Day Avg. Volume2,610,467

30 Day Avg. Volume2,462,694

Financial Highlights & Ratios

PEG Ratio12.12

Price to Book (P/B)6.48

Price to Sales (P/S)0.00

P/FCF Ratio48.39

Enterprise Value/Market Cap1.21

Enterprise Value/Revenue1.26

Enterprise Value/Gross Profit11.39

Enterprise Value/Ebitda4.47

Forecast

1Y Price Target

$232.77

Price Target Upside11.74% Upside

Rating ConsensusHold

Number of Analyst Covering14

Marsh & Mclennan Companies Business Overview & Revenue Model

Company DescriptionMarsh & McLennan Companies (MMC) is a leading global professional services firm providing advice and solutions in the areas of risk, strategy, and people. Operating through its four main subsidiaries—Marsh, Guy Carpenter, Mercer, and Oliver Wyman—MMC serves a diverse client base across various industries. Marsh is a global leader in insurance broking and risk management; Guy Carpenter specializes in reinsurance and capital strategies; Mercer focuses on health, wealth, and career consulting; and Oliver Wyman offers management consulting services. Collectively, these subsidiaries enable MMC to deliver comprehensive and integrated solutions to its clients worldwide.

How the Company Makes MoneyMarsh & McLennan Companies generates revenue primarily through its subsidiaries, each of which operates in distinct but interconnected areas. Marsh earns money through insurance brokerage services, earning commissions and fees from insurers for placing and managing insurance contracts. Guy Carpenter generates revenue by providing reinsurance and capital strategy services, which involve advising insurers on risk management and capital solutions. Mercer earns its income by offering consulting services in health, wealth, and career, charging fees for its advisory and outsourced services. Oliver Wyman contributes by providing management consulting services, earning fees from clients for strategic advisory and consulting projects. MMC also benefits from cross-selling opportunities and strategic partnerships across its subsidiaries, leveraging its comprehensive expertise to offer integrated solutions to complex client needs, thereby enhancing its revenue potential.

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's revenue shows a consistent upward trend, reflecting strong market positioning, while Guy Carpenter benefits from record cat bond issuance. However, fiduciary interest income faces pressure from declining interest rates, impacting overall growth. Despite these challenges, Marsh McLennan's strategic acquisitions, like McGriff, and robust performance in Latin America support revenue growth. The company remains optimistic about mid-single-digit growth, but macroeconomic uncertainties and declining global property rates could pose risks. Investors should watch for how these factors influence future performance and the company's ability to navigate market volatility.

Data provided by:

Main Street Data

Marsh & Mclennan Companies Earnings Call Summary

Earnings Call Date:Jul 17, 2025

(Q2-2025)

% Change Since: -1.30%|

Next Earnings Date:Oct 16, 2025

Earnings Call Sentiment Neutral

The earnings call presented a balanced view with strong revenue growth and international performance, yet highlighted challenges such as high litigation costs, declining fiduciary interest income, and softening insurance rates. Both opportunities and challenges were emphasized, indicating a mixed outlook.

Q2-2025 Updates

Positive Updates

Strong Revenue Growth

Revenue grew 12% in the quarter, with underlying revenue increasing by 4%. Adjusted operating income increased 14%, and adjusted EPS grew 11%.

International Growth

Marsh's international growth was strong with EMEA up 8%, Asia Pacific up 4%, and Latin America up 3%.

Risk and Insurance Services Performance

Risk and Insurance Services revenue was up 15% with an underlying growth of 4%. Adjusted operating income was up 16%.

Consulting Segment Growth

Consulting segment revenue increased by 7%, with a 3% underlying growth. Adjusted operating income was up 9%.

Oliver Wyman's Performance

Oliver Wyman's revenue increased by 5%, with underlying growth of 3%, led by solid growth in the U.S.

Increased Dividend

Announced a 10% increase in the quarterly dividend to $0.90.

Negative Updates

Litigation and Liability Costs

Excessive litigation and liability insurance costs are impacting U.S. businesses. U.S. liability insurance experienced the most severe adverse reserve development since the 2008 global financial crisis.

Decline in Fiduciary Interest Income

Fiduciary interest income was $99 million, down $26 million compared to the second quarter of last year.

Softening Insurance Rates

Global insurance rates decreased, particularly in property insurance, with commercial rates down 4% in the second quarter.

Career Business Challenges

Career business contracted by 5%, driven by softness in project demand in the U.S. and Canada.

Company Guidance

During the earnings call, Marsh & McLennan presented their second quarter 2025 results, highlighting a 12% increase in consolidated revenue to $7 billion, with underlying revenue growth of 4%. Adjusted operating income rose by 14% to $2.1 billion, while adjusted EPS grew 11% to $2.72. The company reported an adjusted operating margin increase of 50 basis points to 29.5%. In the Risk and Insurance Services segment, revenue increased 15% to $4.6 billion, with underlying growth of 4%, and an adjusted operating margin expansion of 30 basis points to 35.6%. Consulting revenue rose 7% to $2.4 billion, with underlying growth of 3% and an adjusted operating margin increase of 40 basis points to 20.2%. Marsh's international operations saw significant growth, with EMEA up 8% and Asia Pacific up 4%. The company also announced a 10% increase in its quarterly dividend to $0.90 and completed $300 million of share repurchases. Looking ahead, Marsh & McLennan expects mid-single-digit underlying revenue growth and solid growth in adjusted EPS for 2025, with continued focus on guiding clients through a complex macro environment.

Marsh & Mclennan Companies Financial Statement Overview

Summary

Marsh & McLennan Companies (MMC) exhibits strong financial health with consistent revenue growth, high profitability margins, and effective cash flow management. The company's gross profit margin is robust at 58%, and it maintains a healthy net profit margin of 16.1%. The debt-to-equity ratio is high at 1.59, which is typical for the industry, but the company effectively generates returns with a 28.7% return on equity. The free cash flow growth of 4.79% further highlights strong financial performance.

Income Statement

Very Positive

The company has shown a consistent revenue growth trajectory with a TTM revenue increase of 2.41% compared to the previous year. The gross profit margin stands strong at 58.0% for TTM, reflecting efficient cost management. Net profit margin is also healthy at 16.1%, indicating solid profitability. The EBIT and EBITDA margins of 24.1% and 28.3% respectively demonstrate robust operational efficiency.

Balance Sheet

Positive

The debt-to-equity ratio is relatively high at 1.59, which could imply potential leverage risks, though common in the industry. However, the company maintains a decent return on equity of 28.7%, signifying effective use of equity to generate profits. The equity ratio of 24.7% indicates a moderate level of equity financing.

Cash Flow

Positive

There is a notable free cash flow growth of 4.79% in the TTM, indicating improved cash generation capabilities. The operating cash flow to net income ratio is strong at 1.10, suggesting efficient cash flow management relative to net income. Furthermore, the free cash flow to net income ratio of 1.03 is satisfactory, highlighting sound cash conversion.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.46B	22.74B	20.72B	19.82B	17.22B
Gross Profit	10.46B	9.64B	8.65B	8.39B	7.09B
EBITDA	6.93B	6.32B	5.69B	5.50B	4.06B
Net Income	4.06B	3.76B	3.05B	3.14B	2.02B
Balance Sheet
Total Assets	56.48B	48.03B	33.45B	34.39B	33.03B
Cash, Cash Equivalents and Short-Term Investments	2.40B	3.36B	1.44B	1.75B	2.09B
Total Debt	21.86B	15.44B	13.47B	13.16B	13.58B
Total Liabilities	42.95B	35.66B	33.37B	23.17B	23.77B
Stockholders Equity	13.34B	12.19B	10.52B	11.01B	9.10B
Cash Flow
Free Cash Flow	3.99B	3.84B	3.00B	3.11B	3.03B
Operating Cash Flow	4.30B	4.26B	3.46B	3.52B	3.38B
Investing Cash Flow	-8.82B	-1.42B	-850.00M	-1.16B	-814.00M
Financing Cash Flow	4.46B	-1.12B	-1.05B	-1.30B	-925.00M

Marsh & Mclennan Companies Technical Analysis

Technical Analysis Sentiment

Negative

Last Price208.32

Price Trends

50DMA

219.41

Negative

100DMA

224.43

Negative

200DMA

222.02

Negative

Market Momentum

MACD

-2.81

Negative

RSI

36.45

Neutral

STOCH

2.28

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 208.32 is below the 20-day moving average (MA) of 212.25, below the 50-day MA of 219.41, and below the 200-day MA of 222.02, indicating a bearish trend. The MACD of -2.81 indicates Negative momentum. The RSI at 36.45 is Neutral, neither overbought nor oversold. The STOCH value of 2.28 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 33 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
BRO	76 Outperform	$33.50B	28.76	16.18%	0.56%	12.57%	10.52%
ERIE	76 Outperform	$17.02B	31.34	32.38%	1.82%	15.05%	26.80%
AON	71 Outperform	$77.01B	30.44	74.17%	0.78%	19.57%	-8.09%
AJG	71 Outperform	$79.59B	47.81	9.27%	0.81%	14.07%	31.44%
WTW	69 Neutral	$30.61B	―	-0.60%	1.17%	2.42%	-103.64%
Sector *	68 Neutral	¥760.77B	10.93	7.55%	3.20%	7.81%	14.63%
MMC	67 Neutral	$103.14B	25.18	28.33%	1.61%	9.22%	3.05%

* Financial Sector Average

Performance Comparison

MMC

Marsh & Mclennan Companies

208.32

-6.39

-2.98%

AON

Aon

356.61

35.45

11.04%

AJG

Arthur J Gallagher & Co

309.06

27.71

9.85%

BRO

Brown & Brown

102.78

4.15

4.21%

ERIE

Erie Indemnity Company

366.94

-48.92

-11.76%

WTW

Willis Towers Watson

308.73

28.90

10.33%

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