Back to top

Marsh & McLennan Announces New Share Repurchase Plan

Read MoreHide Full Article

The Board of Directors of  Marsh & McLennan Companies, Inc. (MMC - Free Report) recently authorized an increase in the company’s share repurchase program. Management can now repurchase up to $2.5 billion of the company’s common stock.

The company focuses on retaining investor confidence on the stock. Hence, enhancing shareholders’ value through effective capital deployment is an important strategy of Marsh & McLennan.

The company deployed $3.2 billion in 2015 for share buybacks, dividend payments and acquisitions. This is 39% higher than $2.3 billion spent in 2014 and 92% higher than $1.2 billion deployed in 2013. The company has been reducing its outstanding share count over the last ten consecutive quarters in order to boost the bottom line.

During the first nine months of 2016, Marsh & McLennan spent a total of $625 million to buy back 10 million of its common stocks. The third quarter of 2016 was the 18th consecutive quarter of share repurchases by the company.

We note that dividend payment is another major capital deployment strategy of Marsh & McLennan. The company started paying dividends since 2006 and has been raising its dividend by a comfortable percentage every year. In fact, the latest 9.7% hike in dividends marks 2016 as the 10th consecutive year of dividend increases by the company.

By the end of 2016, Marsh & McLennan expects to deploy nearly $2.3 billion of capital through dividends, share repurchases and acquisitions. It also plans to deliver on its annual capital return commitment to reduce share count and increase dividend per share by double digits.


Zacks Rank and Stocks to Consider

Marsh & McLennan presently carries Zacks Rank #3 (Hold).

Investors can also look at better-ranked stocks from the insurance space like Health Insurance Innovations, Inc. (HIIQ - Free Report) , Lincoln National Corp. (LNC - Free Report) and Universal American Corp . While Health Insurance Innovations sports a Zacks Rank #1 (Strong Buy), the other two carry Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.

Health Insurance Innovations delivered positive earnings surprise over last four quarters with an average substantial beta of 270.84%

On the other hand, Universal American delivered negative  surprise in two of the last four quarters with an average miss of 231.25%.

Similar to Universal American, Lincoln National also delivered negative surprise in two of the last four quarters with an average miss of 0.81%.

The Best Place to Start Your Stock Search

Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>

More from Zacks Analyst Blog

You May Like