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On Mar 21, 2013, the shares of Willis Group Holdings plc (WSH - Analyst Report) reached a 52-week high of $38.94. Earlier, the company generated a positive surprise of 2.27% in the fourth quarter of 2012. Further, Willis Group reported a positive surprise in 8 out of the past 10 quarters.

Willis Group reported fourth-quarter 2012 adjusted net income from continuing operations of 45 cents per share, surpassing the Zacks Consensus Estimate by a penny. Results were in line with the year-ago earnings.

In order to enhance its profitability, Willis Group is undertaking a cost saving initiative. Management is reviewing the organizational design and aims to reduce headcount. The company is also strengthening its balance sheet by increasing the cash balance and reducing debt.

Moreover, Willis Group has consistently tried to enhance its shareholders value via dividend increase as well as share buyback. Recently, in Feb 2013, the board approved a 3.7% hike in its dividend. The company’s dividend yield of 3.05% is much ahead of the industry yield of 1.64% as well as of its nearest peers, Aon plc (AON - Analyst Report), with a dividend yield of 1.07% and Marsh & McLennan Companies Inc. (MMC - Analyst Report) with a yield of 2.55%.

The valuation of Willis Group looks attractive. The shares are trading at a discount to its peers both on a price-to-book and forward price-to-earnings basis, while the return on equity of 18.5% is higher than the peer group average of 12.3%.

Willis Group currently carries a Zacks Rank #3 (Hold). Another insurance broker – Brown & Brown Inc. (BRO - Snapshot Report) – carrying a Zacks Rank #2 (Buy) is worth considering.

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