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.
Why Is Marsh & McLennan (MMC) Up 1.9% Since Last Earnings Report?
Read MoreHide Full Article
A month has gone by since the last earnings report for Marsh & McLennan (MMC - Free Report) . Shares have added about 1.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Marsh & McLennan due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Marsh & McLennan delivered first-quarter 2021 adjusted earnings per share of $1.99, surpassing the Zacks Consensus Estimate by 17.1%. This is owing to a solid contribution from its Risk and Insurance Services as well as Consulting segments. Moreover, the bottom line increased 21.3% from the year-ago quarter.
Marsh & McLennan’s consolidated revenues of $5.1 billion were up 9% year over year. Moreover, the top line beat the Zacks Consensus Estimate by 5.6% on the back of its strong Risk and Insurance Services as well as Consulting segments.
Total operating expenses of $3.7 billion in the first quarter were up 4% year over year due to higher compensation and benefits.
Quarterly Segmental Results
Risk and Insurance Services
Revenues at this segment were $3.2 billion, up 7% on an underlying basis. Adjusted operating income improved 17% to $1.1 billion from the prior-year quarter’s level.
Marsh, a unit within this segment, generated revenues of $2.3 billion, up 8% on an underlying basis. In the U.S./Canada, underlying revenues rose 9% year over year.
Underlying revenues from international operations rose 6% year over year including an 8% increase of the same in the Asia Pacific, a 6% rise in Latin America and a 6% hike in EMEA.
Revenues from another unit under this segment, Guy Carpenter, were up 7% year over year on an underlying basis in the quarter under review.
Consulting
Revenues were up 3% on an underlying basis to $1.9 billion. Also, adjusted operating income was up 28% to $370 million.
A unit within this segment, Mercer, generated revenues of $1.3 billion, which were flat on an underlying basis. Wealth’s revenues were up 1% on an underlying basis. Health’s revenues were flat year over year while that of Career was up 1% on an underlying basis. Another unit Oliver Wyman Group registered revenues of $585 million, up 11% year over year on an underlying basis.
Financial Update
Marsh & McLennan exited the first quarter with cash and cash equivalents of $1.1 billion, down 46.4% from the level at 2020 end.
Net cash used for operations stood at $408 million, lower than the year-ago quarter’s $638 million.
As of Mar 31, 2021, Marsh & McLennan’s total assets were $32.3 billion, down 2.3% from the figure as of Dec 31, 2020.
Total equity was $9.6 billion, up 3.6% from the level at 2020 end.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
VGM Scores
Currently, Marsh & McLennan has a poor Growth Score of F, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Marsh & McLennan has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is Marsh & McLennan (MMC) Up 1.9% Since Last Earnings Report?
A month has gone by since the last earnings report for Marsh & McLennan (MMC - Free Report) . Shares have added about 1.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Marsh & McLennan due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Marsh & McLennan's Q1 Earnings Surpass, Improve Y/Y
Marsh & McLennan delivered first-quarter 2021 adjusted earnings per share of $1.99, surpassing the Zacks Consensus Estimate by 17.1%. This is owing to a solid contribution from its Risk and Insurance Services as well as Consulting segments. Moreover, the bottom line increased 21.3% from the year-ago quarter.
Marsh & McLennan’s consolidated revenues of $5.1 billion were up 9% year over year. Moreover, the top line beat the Zacks Consensus Estimate by 5.6% on the back of its strong Risk and Insurance Services as well as Consulting segments.
Total operating expenses of $3.7 billion in the first quarter were up 4% year over year due to higher compensation and benefits.
Quarterly Segmental Results
Risk and Insurance Services
Revenues at this segment were $3.2 billion, up 7% on an underlying basis. Adjusted operating income improved 17% to $1.1 billion from the prior-year quarter’s level.
Marsh, a unit within this segment, generated revenues of $2.3 billion, up 8% on an underlying basis. In the U.S./Canada, underlying revenues rose 9% year over year.
Underlying revenues from international operations rose 6% year over year including an 8% increase of the same in the Asia Pacific, a 6% rise in Latin America and a 6% hike in EMEA.
Revenues from another unit under this segment, Guy Carpenter, were up 7% year over year on an underlying basis in the quarter under review.
Consulting
Revenues were up 3% on an underlying basis to $1.9 billion. Also, adjusted operating income was up 28% to $370 million.
A unit within this segment, Mercer, generated revenues of $1.3 billion, which were flat on an underlying basis. Wealth’s revenues were up 1% on an underlying basis. Health’s revenues were flat year over year while that of Career was up 1% on an underlying basis. Another unit Oliver Wyman Group registered revenues of $585 million, up 11% year over year on an underlying basis.
Financial Update
Marsh & McLennan exited the first quarter with cash and cash equivalents of $1.1 billion, down 46.4% from the level at 2020 end.
Net cash used for operations stood at $408 million, lower than the year-ago quarter’s $638 million.
As of Mar 31, 2021, Marsh & McLennan’s total assets were $32.3 billion, down 2.3% from the figure as of Dec 31, 2020.
Total equity was $9.6 billion, up 3.6% from the level at 2020 end.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
VGM Scores
Currently, Marsh & McLennan has a poor Growth Score of F, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Marsh & McLennan has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.