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Marsh & McLennan (MMC) Okays 10.3% Rise in Quarterly Dividend
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Marsh & McLennan Companies, Inc.’s (MMC - Free Report) board of directors recently approved a 10.3% hike in the quarterly dividend to boost shareholders’ value. MMC will now pay out a dividend of 59 cents per share compared with the previous payout of 53.5 cents.
The increased dividend, which marks the 13th straight year of dividend hike, will be paid on Aug 15, 2022, to shareholders of record as of Jul 28. The insurance broker has raised its dividends at a 13-year CAGR of 8.7%. Based on the stock’s Jul 13 closing price of $151.59, its dividend yield of 1.4% compares favorably with the industry’s figure of 1.2%.
Prior to the latest hike, Marsh & McLennan had increased its quarterly dividend by 15% a year ago, thereby sustaining management’s target of raising dividend each year.
Apart from resorting to annual dividend hikes and uninterrupted quarterly dividend payments, Marsh & McLennan pursues tactical deployment of capital through share repurchases. MMC boasts of a strong repurchase history, as evident from last year’s share buybacks worth $1.2 billion — the highest level of share repurchases conducted by the insurance broker since 2015.
Marsh and McLennan’s management sanctioned a $5 billion increase in its share buyback program in March 2022 as well. As roughly $1.3 billion remained under its buyback program at the end of 2021, the $5 billion increase enabled MMC to conduct share repurchases of around $6.3 billion. However, at the time of the announcement about the increased authorization, the total authorization value ($6.3 billion) did not include any share buybacks conducted in the first quarter. Consequent to share buybacks of $500 million in the first quarter, Marsh and McLennan had $5.8 billion in funds remaining under its share buyback program as of Mar 31, 2022.
This year is also expected to be a strong one for Marsh & McLennan with respect to capital deployment history, as it plans to deploy around $4 billion in capital in 2022 through dividend payments, acquisitions and share repurchases.
Such uninterrupted capital deployment moves highlight a company’s strong financial position. Marsh & McLennan boasts of a strong financial position, thanks to its adequate cash reserves and robust free cash flow generation abilities. In the trailing 12-month period, adjusted free cash flows of MMC surged 67.4% from the prior-year comparable period.
Return on equity, a profitability measure to identify how tactically the company is utilizing its shareholders’ funds, stands at 31.2% for Marsh & McLennan. The figure remains higher than the industry’s average of 29.5%.
Shares of Marsh & McLennan have gained 7.4% in a year against the industry’s decline of 4.4%.
The bottom line of Unum Group outpaced estimates in three of the trailing four quarters and missed once, the average surprise being 22.06%. The Zacks Consensus Estimate for UNM’s 2022 earnings suggests 17.2% year-over-year growth, while the same for revenues implies an improvement of 0.7%. The consensus mark for Unum Group’s 2022 earnings has moved north by 3.7% in the past 60 days.
United Fire Group’s earnings outpaced estimates in three of the trailing three quarters and matched once, the average surprise being 270.83%. The Zacks Consensus Estimate for UFCS’s 2022 earnings indicates 46.2% year-over-year growth. United Fire Group’s consensus mark for 2022 earnings has moved north by 23.5% in the past 60 days.
The bottom line of Fidelity National outpaced estimates in each of the trailing four quarters, the average surprise being 27.61%. The Zacks Consensus Estimate for FNF’s 2022 earnings has moved north by 0.3% in the past 60 days. Fidelity National boasts of an impressive VGM Score of A.
Shares of Unum Group and United Fire Group have gained 14.2% and 27.8%, respectively, in a year. However, Fidelity National stock has lost 18.1% in the same time frame.
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Marsh & McLennan (MMC) Okays 10.3% Rise in Quarterly Dividend
Marsh & McLennan Companies, Inc.’s (MMC - Free Report) board of directors recently approved a 10.3% hike in the quarterly dividend to boost shareholders’ value. MMC will now pay out a dividend of 59 cents per share compared with the previous payout of 53.5 cents.
The increased dividend, which marks the 13th straight year of dividend hike, will be paid on Aug 15, 2022, to shareholders of record as of Jul 28. The insurance broker has raised its dividends at a 13-year CAGR of 8.7%. Based on the stock’s Jul 13 closing price of $151.59, its dividend yield of 1.4% compares favorably with the industry’s figure of 1.2%.
Prior to the latest hike, Marsh & McLennan had increased its quarterly dividend by 15% a year ago, thereby sustaining management’s target of raising dividend each year.
Apart from resorting to annual dividend hikes and uninterrupted quarterly dividend payments, Marsh & McLennan pursues tactical deployment of capital through share repurchases. MMC boasts of a strong repurchase history, as evident from last year’s share buybacks worth $1.2 billion — the highest level of share repurchases conducted by the insurance broker since 2015.
Marsh and McLennan’s management sanctioned a $5 billion increase in its share buyback program in March 2022 as well. As roughly $1.3 billion remained under its buyback program at the end of 2021, the $5 billion increase enabled MMC to conduct share repurchases of around $6.3 billion. However, at the time of the announcement about the increased authorization, the total authorization value ($6.3 billion) did not include any share buybacks conducted in the first quarter. Consequent to share buybacks of $500 million in the first quarter, Marsh and McLennan had $5.8 billion in funds remaining under its share buyback program as of Mar 31, 2022.
This year is also expected to be a strong one for Marsh & McLennan with respect to capital deployment history, as it plans to deploy around $4 billion in capital in 2022 through dividend payments, acquisitions and share repurchases.
Such uninterrupted capital deployment moves highlight a company’s strong financial position. Marsh & McLennan boasts of a strong financial position, thanks to its adequate cash reserves and robust free cash flow generation abilities. In the trailing 12-month period, adjusted free cash flows of MMC surged 67.4% from the prior-year comparable period.
Return on equity, a profitability measure to identify how tactically the company is utilizing its shareholders’ funds, stands at 31.2% for Marsh & McLennan. The figure remains higher than the industry’s average of 29.5%.
Shares of Marsh & McLennan have gained 7.4% in a year against the industry’s decline of 4.4%.
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Zacks Rank & Key Picks
MMC currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks in the insurance space include Unum Group (UNM - Free Report) , United Fire Group, Inc. (UFCS - Free Report) and Fidelity National Financial, Inc. (FNF - Free Report) . While United Fire Group flaunts a Zacks Rank #1 (Strong Buy), Unum Group and Fidelity National carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The bottom line of Unum Group outpaced estimates in three of the trailing four quarters and missed once, the average surprise being 22.06%. The Zacks Consensus Estimate for UNM’s 2022 earnings suggests 17.2% year-over-year growth, while the same for revenues implies an improvement of 0.7%. The consensus mark for Unum Group’s 2022 earnings has moved north by 3.7% in the past 60 days.
United Fire Group’s earnings outpaced estimates in three of the trailing three quarters and matched once, the average surprise being 270.83%. The Zacks Consensus Estimate for UFCS’s 2022 earnings indicates 46.2% year-over-year growth. United Fire Group’s consensus mark for 2022 earnings has moved north by 23.5% in the past 60 days.
The bottom line of Fidelity National outpaced estimates in each of the trailing four quarters, the average surprise being 27.61%. The Zacks Consensus Estimate for FNF’s 2022 earnings has moved north by 0.3% in the past 60 days. Fidelity National boasts of an impressive VGM Score of A.
Shares of Unum Group and United Fire Group have gained 14.2% and 27.8%, respectively, in a year. However, Fidelity National stock has lost 18.1% in the same time frame.