Marsh & Mclennan Companies (MMC) AI Stock Analysis

• Market Cap: $89.51B
• Dividend Yield: 1.88%
• Average Volume (3M): 3.23M
• Price to Earnings (P/E): 21.9
• Beta (1Y): 0.29
• Revenue Growth: 10.57%
• EPS Growth: 2.57%
• Country: US
• Employees: 90,000
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Brokers
• EPS (TTM): 1.85
• Shares Outstanding: 489,909,670
• 10 Day Avg. Volume: 2,844,960
• 30 Day Avg. Volume: 3,230,315
• PEG Ratio: 3.01
• Price to Book (P/B): 7.83
• Price to Sales (P/S): 4.27
• P/FCF Ratio: 26.22
• Enterprise Value/Market Cap: 1.33
• Enterprise Value/Revenue: 4.49
• Enterprise Value/Gross Profit: 10.61
• Enterprise Value/Ebitda: 16.36
• 1Y Price Target: $210.65
• Price Target Upside: 15.30% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 18
• EPS Forecast (FY): 9.61
• Revenue Forecast (FY): $26.95B

• Rating: 71 Outperform
• Price Target: $206.00 ▲(12.75% Upside)

Marsh & McLennan Companies' overall stock score reflects its strong financial performance and strategic initiatives highlighted in the earnings call. However, bearish technical indicators and moderate valuation metrics slightly temper the outlook. The company's proactive approach to leveraging technology and managing costs positions it well for future growth, despite current market challenges.

Positive Factors

Revenue Growth

The 11% revenue growth indicates strong market demand and effective business strategies, supporting long-term financial health and expansion potential.

Strategic Rebranding

Rebranding to 'Marsh' and consolidating services under a unified brand can enhance market presence and streamline operations, fostering long-term growth.

AI and Technology Investments

Investments in AI and technology enhance operational efficiency and service offerings, positioning the company for sustained competitive advantage.

Negative Factors

High Debt Levels

High leverage can increase financial risk and limit flexibility, potentially impacting long-term financial stability and investment capacity.

Decline in Property Casualty Rates

Declining property casualty rates can pressure revenue growth in key segments, challenging the company's ability to maintain past growth levels.

Economic Uncertainty

Economic uncertainty, particularly in the U.S., can affect client spending and demand for services, posing risks to sustained revenue growth.

Marsh & Mclennan Companies Business Overview & Revenue Model

Company Description

Marsh & 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 Money

Marsh & 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 Financial Statement Overview

Summary

Marsh & McLennan Companies exhibits strong financial performance with high profitability and consistent revenue growth. The income statement is particularly robust, with healthy margins and a positive growth trajectory. The balance sheet shows manageable leverage and solid returns on equity, while the cash flow statement, despite some areas for improvement, indicates good cash generation.

Income Statement

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

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

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	26.45B	24.46B	22.74B	20.72B	19.82B	17.22B
Gross Profit	11.18B	10.46B	9.64B	8.65B	8.39B	7.09B
EBITDA	7.25B	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	58.78B	56.48B	48.03B	33.45B	34.39B	33.03B
Cash, Cash Equivalents and Short-Term Investments	2.51B	2.40B	3.36B	1.44B	1.75B	2.09B
Total Debt	21.43B	21.86B	15.44B	13.47B	13.16B	13.58B
Total Liabilities	43.42B	42.95B	35.66B	22.70B	23.17B	23.77B
Stockholders Equity	15.15B	13.34B	12.19B	10.52B	11.01B	9.10B
Cash Flow
Free Cash Flow	5.11B	3.99B	3.84B	3.00B	3.11B	3.03B
Operating Cash Flow	5.34B	4.30B	4.26B	3.46B	3.52B	3.38B
Investing Cash Flow	-7.97B	-8.82B	-1.42B	-850.00M	-1.16B	-793.00M
Financing Cash Flow	3.44B	4.46B	-1.12B	-1.05B	-1.30B	-925.00M

Marsh & Mclennan Companies Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 182.70
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MMC, the sentiment is Neutral. The current price of 182.7 is above the 20-day moving average (MA) of 180.07, below the 50-day MA of 189.79, and below the 200-day MA of 211.56, indicating a neutral trend. The MACD of -2.28 indicates Negative momentum. The RSI at 48.30 is Neutral, neither overbought nor oversold. The STOCH value of 55.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for MMC.

Marsh & Mclennan Companies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MMC	71 Outperform	$89.51B	21.91	28.62%	1.88%	10.57%	2.57%
BRO	71 Outperform	$27.47B	24.14	10.47%	0.76%	17.87%	-9.35%
ERIE	70 Outperform	$13.70B	23.92	30.44%	1.86%	9.64%	15.87%
AJG	69 Neutral	$63.82B	39.54	9.05%	0.97%	17.17%	19.12%
WTW	69 Neutral	$30.76B	15.33	27.79%	1.13%	―	―
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
AON	66 Neutral	$75.79B	28.24	38.33%	0.83%	14.06%	5.52%

Marsh & Mclennan Companies Corporate Events

Marsh McLennan Reports Strong Q3 2025 Results

Marsh McLennan is a global professional services firm specializing in risk management, strategy, and human capital, operating in 130 countries through its four main businesses: Marsh, Guy Carpenter, Mercer, and Oliver Wyman.

Marsh & McLennan’s Earnings Call Highlights Strategic Growth Amid Challenges

Marsh & McLennan’s recent earnings call painted a picture of a company navigating both opportunities and challenges. The sentiment was generally positive, buoyed by solid revenue growth and strategic investments in AI and technology. However, this optimism was tempered by concerns over declining property casualty rates and broader economic uncertainties. Despite these hurdles, the company’s financial performance remains robust, with significant investments poised to drive future growth.

Marsh & McLennan’s 2024 Risk Factors: Key Concerns for Investors and Analysts

Marsh & McLennan faces significant risks and uncertainties that could materially impact its business operations and financial health. Stakeholders are advised to thoroughly review the risk factors outlined in the company’s Annual Report on Form 10-K for the year ending December 31, 2024. These risks, if realized, could adversely affect the company’s results of operations and financial condition. It is crucial for investors and analysts to consider these potential challenges when evaluating the company’s future prospects.