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Marsh & McLennan (MMC) Q4 Earnings: Is a Beat in Store?

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Marsh & McLennan Companies, Inc. (MMC - Free Report) will release fourth-quarter 2017 results on Feb 1, before the market opens. Last quarter, the company delivered a positive earnings surprise of 1.28%. Let’s see how things are shaping up for this announcement.

Why a Likely Positive Surprise?

Our proven model shows that Marsh & McLennan has the right combination of two key ingredients to beat estimates this quarter.

Zacks ESP: The company has an Earnings ESP of +0.18%, representing the difference between the Most Accurate estimate and the Zacks Consensus Estimate. The positive ESP indicates a likely earnings surprise. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Marsh & McLennan Companies, Inc. Price and EPS Surprise

Zacks Rank: Marsh & McLennan carries a Zacks Rank #3 (Hold). Notably, stocks with a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of an earnings beat.

Conversely, the Sell-rated stocks (#4 or 5) should never be considered going into an earnings announcement, especially when the company is seeing negative estimate revisions.

Q4 Expectations

The company’s fourth-quarter results are  expected to benefit from increased revenues at both its operating segments, namely Risk and Insurance Services, and Consulting. The Zacks Consensus Estimate for net operating revenues is pegged at $3.6 billion, reflecting 6.5% year-over-year growth.

The company’s Risk and Insurance Services segment has been growing for the past several quarters on the back of accretive acquisitions and the trend is expected to continue in the fourth quarter.

Also, the company’s Consulting segment has been significantly contributing to the revenue base on the back of both organic and inorganic growth efforts. The Zacks Consensus Estimate for revenues for the segment is $1.9 billion, up 18.7% year over year.

The company is expanding in regions such as Latin America, Asia, the Middle East and South Africa, which are underpenetrated but holds high-growth potential. Performance from these regions is likely to contribute to the overall results. In addition, the company is also expanding in new businesses which are expected to drive revenues.

Other Stocks to Consider

Here are some companies worth considering as our model shows that these possess the right combination of elements to beat estimates this quarter:  

Amerisafe Inc. (AMSF - Free Report) will report fourth-quarter 2017 earnings results on Feb 26. The company has an Earnings ESP of +1.61% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Primerica, Inc. (PRI - Free Report) has an Earnings ESP of +0.58% and is a Zacks #1 Ranked player. The company is set to announce fourth-quarter earnings on Feb 7.

Torchmark Corporation has an Earnings ESP of +0.12% and is a Zacks #2 Ranked player. The company is slated to release fourth-quarter earnings on Feb 7.  

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