We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Marsh & McLennan (MMC) Beats Q1 Earnings on Higher Revenues
Read MoreHide Full Article
Marsh & McLennan Companies, Inc. ((MMC - Free Report) reported first-quarter 2017 operating earnings per share of $1.08, which surpassed the Zacks Consensus Estimate of 99 cents. Earnings improved 17.4% year over year due to a benefit from the required change in accounting for share-based awards.
Adjusted operating income, which excludes noteworthy items as presented in the attached supplemental schedules, rose 9% to $802 million in the first quarter.
Marsh & McLennan’s consolidated revenues were $3.5 billion, up 5% year over year on an underlying basis. Revenues also surpassed the Zacks Consensus Estimate by 1.1%.
Total operating expenses of $2.7 billion increased 35% year over year.
Segment Results
Revenues from the Risk and Insurance Services segment were $2 billion, up 4% year over year on an underlying basis. Adjusted operating income also grew 10% to $600 million from the last-year quarter.
A unit within this segment – Marsh – reported revenues of $1.6 billion, up 5% year over year on an underlying basis. Underlying revenues grew 5% year over year in international operations due to growth of 7% in Latin America, 11% in the Asia Pacific, 35% in EMEA (Europe, the Middle East and Africa) and 5% in the U.S.-Canada region.
Another unit under this segment, Guy Carpenter, displayed revenue growth of 4% year over year on an underlying basis to $385 million.
The Consulting segment's revenues increased 3% year over year on an underlying basis to $1.56 billion. Additionally, adjusted operating income inched up 3% year over year to $245 million.
A unit within this segment – Mercer – reported revenues of $1.1 billion, up 3% year over year on an underlying basis. Mercer’s wealth business witnessed revenues of $520 million, up 3% year over year on an underlying basis.
Another unit, Oliver Wyman Group, reported revenues of $449 million, up 4% year over year on an underlying basis.
Financial Update
Marsh & McLennan exited the quarter with cash and cash equivalents of $930 million, down 9.4% from year-end 2016.
As of Mar 31, 2016, Marsh & McLennan’s total assets were $19 billion, up 4.3% year over year.
Total equity was $6.6 billion, up 10% from year-end 2016.
Capital Deployment
In Jan 2017, Marsh & McLennan issued $500 million of 2.75% senior notes due in 2022 and $500 million 4.35% senior notes due in 2047. The company intends to utilize the net proceeds for general corporate purposes, including repayment of $250 million 2.30% senior notes on Apr 1, 2017.
Marsh & McLennan repurchased approximately 2.7 million shares of its common stock for $200 million in the first quarter.
Marsh & McLennan Companies, Inc. Price, Consensus and EPS Surprise
During the first quarter, Marsh & McLennan Agency (“MMA”), another unit of Marsh & McLennan, completed the acquisition of J. Smith Lanier & Co. (“JSL”), one of the nation’s largest privately held insurance brokers. JSL has annual revenue of approximately $130 million.
Among other players from the same space that have reported their first-quarter earnings so far, the bottom line at The Progressive Corporation (PGR - Free Report) , The Travelers Companies, Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) missed their respective Zacks Consensus Estimate.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
Image: Bigstock
Marsh & McLennan (MMC) Beats Q1 Earnings on Higher Revenues
Marsh & McLennan Companies, Inc. ((MMC - Free Report) reported first-quarter 2017 operating earnings per share of $1.08, which surpassed the Zacks Consensus Estimate of 99 cents. Earnings improved 17.4% year over year due to a benefit from the required change in accounting for share-based awards.
Adjusted operating income, which excludes noteworthy items as presented in the attached supplemental schedules, rose 9% to $802 million in the first quarter.
Marsh & McLennan’s consolidated revenues were $3.5 billion, up 5% year over year on an underlying basis. Revenues also surpassed the Zacks Consensus Estimate by 1.1%.
Total operating expenses of $2.7 billion increased 35% year over year.
Segment Results
Revenues from the Risk and Insurance Services segment were $2 billion, up 4% year over year on an underlying basis. Adjusted operating income also grew 10% to $600 million from the last-year quarter.
A unit within this segment – Marsh – reported revenues of $1.6 billion, up 5% year over year on an underlying basis. Underlying revenues grew 5% year over year in international operations due to growth of 7% in Latin America, 11% in the Asia Pacific, 35% in EMEA (Europe, the Middle East and Africa) and 5% in the U.S.-Canada region.
Another unit under this segment, Guy Carpenter, displayed revenue growth of 4% year over year on an underlying basis to $385 million.
The Consulting segment's revenues increased 3% year over year on an underlying basis to $1.56 billion. Additionally, adjusted operating income inched up 3% year over year to $245 million.
A unit within this segment – Mercer – reported revenues of $1.1 billion, up 3% year over year on an underlying basis. Mercer’s wealth business witnessed revenues of $520 million, up 3% year over year on an underlying basis.
Another unit, Oliver Wyman Group, reported revenues of $449 million, up 4% year over year on an underlying basis.
Financial Update
Marsh & McLennan exited the quarter with cash and cash equivalents of $930 million, down 9.4% from year-end 2016.
As of Mar 31, 2016, Marsh & McLennan’s total assets were $19 billion, up 4.3% year over year.
Total equity was $6.6 billion, up 10% from year-end 2016.
Capital Deployment
In Jan 2017, Marsh & McLennan issued $500 million of 2.75% senior notes due in 2022 and $500 million 4.35% senior notes due in 2047. The company intends to utilize the net proceeds for general corporate purposes, including repayment of $250 million 2.30% senior notes on Apr 1, 2017.
Marsh & McLennan repurchased approximately 2.7 million shares of its common stock for $200 million in the first quarter.
Marsh & McLennan Companies, Inc. Price, Consensus and EPS Surprise
Marsh & McLennan Companies, Inc. Price, Consensus and EPS Surprise | Marsh & McLennan Companies, Inc. Quote
Business Update
During the first quarter, Marsh & McLennan Agency (“MMA”), another unit of Marsh & McLennan, completed the acquisition of J. Smith Lanier & Co. (“JSL”), one of the nation’s largest privately held insurance brokers. JSL has annual revenue of approximately $130 million.
Zacks Rank and Performance of Other Insurers
Marsh & McLennan presently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Among other players from the same space that have reported their first-quarter earnings so far, the bottom line at The Progressive Corporation (PGR - Free Report) , The Travelers Companies, Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) missed their respective Zacks Consensus Estimate.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
Click here for Zacks' secret trade>>