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What's in Store for Marsh & McLennan's (MMC) Q2 Earnings?

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Marsh & McLennan Companies, Inc. (MMC - Free Report) is scheduled to release second-quarter 2021 results on Jul 22, before the market opens.

Q2 Estimates

The Zacks Consensus Estimate for the company’s second-quarter earnings per share is pegged at $1.42, suggesting growth of 7.6% from the prior-year quarter’s reported figure. The consensus mark for revenues stands at $4.4 billion, indicating an improvement of 6.1% from the year-ago period’s reported number.

Factors to Note

The company’s revenue results are likely to reflect the benefits of continuous rate hikes across the commercial property and casualty (P&C) insurance and reinsurance markets as well as better economy. Solid performance at the company’s Risk and Insurance Services as well as Consulting segments might have favored the to-be-reported quarter’s top line.

Performance at the Risk and Insurance Services segment is likely to have gained from strong revenues at the company’s Marsh and Guy Carpenter units. The Zacks Consensus Estimate for the company’s Risk and Insurance Services segment’s revenues is pegged at $2.8 billion, implying 9.7% growth from the prior-year quarter’s reported number.

While the U.S. and Canada division might have favored Marsh’s performance in the second quarter, Guy Carpenter’s performance is likely to have benefited from new business generation and higher business renewals.

The consensus estimate for its units -- Marsh and Guy Carpenter -- revenues stands at $2.3 billion and $460 million each, suggesting a respective jump of 10.6% and 6.2% from the corresponding year-ago quarter’s reported figures.

Per the last earnings call, management had expected Mercer to return to underlying growth in the second quarter. The consensus estimate for the Mercer’s revenues stands at $1.1 billion, hinting at a 4.1% rise from the prior-year quarter’s reported number.

The Wealth unit result is likely to reflect strong growth in investment management.

New business generation is expected to have driven growth at Oliver Wyman segment. The consensus mark for Oliver Wyman stands at $531 million, indicating an upside of 13.7% from the prior-year quarter’s reported number.

This, in turn, is likely to have contributed to the overall performance of the Consulting segment. The Zacks Consensus Estimate for revenues from the Consulting segment is pegged at $1.7 billion, which suggests a 6.9% climb from the prior-year quarter’s reported figure.

The company’s disciplined expense management is likely to have aided substantial cost savings, which in turn, might reflect on the second-quarter margin results.

On the flip side, expenses are likely to have remained elevated in the to-be-reported quarter due to higher compensation and benefits, which might have squeezed margins to some extent.

On the last earnings conference, management had projected an interest expense of $114 million for the second quarter.

What Our Quantitative Model Unveils

Our proven model predicts an earnings beat for Marsh & McLennan this time around. The combination of a positive  Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Earnings ESP:  Marsh & McLennan has an Earnings ESP of +1.14%. This is because the Most Accurate Estimate of $1.44 is pegged higher than the Zacks Consensus Estimate of $1.42. 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. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks to Consider

Some other stocks worth considering from the insurance space with a perfect mix of elements to surpass estimates in the upcoming quarterly releases are as follows:

Chubb Limited (CB - Free Report) has an Earnings ESP of +4.83% and a Zacks Rank of 3 at present.

Brown & Brown, Inc. (BRO - Free Report) has an Earnings ESP of +3.96% and a Zacks Rank #2, currently.

Aon plc  (AON - Free Report) has an Earnings ESP of +0.24% and is presently Zacks #3 Ranked.


In-Depth Zacks Research for the Tickers Above


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Chubb Limited (CB) - free report >>

Marsh & McLennan Companies, Inc. (MMC) - free report >>

Aon plc (AON) - free report >>

Brown & Brown, Inc. (BRO) - free report >>

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