AON PLC-CLASS A (AON)
IE00BLP1HW54 - Common Stock
We assign a fundamental rating of 5 out of 10 to AON. AON was compared to 141 industry peers in the Insurance industry. AON has an excellent profitability rating, but there are some minor concerns on its financial health. AON is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
AON had positive earnings in the past year.
In the past year AON had a positive cash flow from operations.
AON had positive earnings in each of the past 5 years.
In the past 5 years AON always reported a positive cash flow from operatings.
1.2 Ratios
AON has a better Return On Assets (6.34%) than 90.71% of its industry peers.
AON's Return On Invested Capital of 17.76% is amongst the best of the industry. AON outperforms 99.29% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AON is significantly above the industry average of 4.07%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.34% | ||
| ROE | N/A | ||
| ROIC | 17.76% |
ROA(3y)6.47%
ROA(5y)6.15%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)20.59%
ROIC(5y)18.65%
1.3 Margins
With an excellent Profit Margin value of 19.04%, AON belongs to the best of the industry, outperforming 85.00% of the companies in the same industry.
AON's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 29.69%, AON belongs to the best of the industry, outperforming 92.14% of the companies in the same industry.
AON's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.69% | ||
| PM (TTM) | 19.04% | ||
| GM | N/A |
OM growth 3Y5.26%
OM growth 5Y7.44%
PM growth 3Y2.51%
PM growth 5Y12.73%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so AON is creating value.
The number of shares outstanding for AON has been reduced compared to 1 year ago.
The number of shares outstanding for AON has been reduced compared to 5 years ago.
The debt/assets ratio for AON has remained at the same level compared to a year ago.
2.2 Solvency
AON has an Altman-Z score of 1.58. This is a bad value and indicates that AON is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of AON (1.58) is better than 90.00% of its industry peers.
The Debt to FCF ratio of AON is 5.37, which is a neutral value as it means it would take AON, 5.37 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 5.37, AON is not doing good in the industry: 65.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.37 | ||
| Altman-Z | 1.58 |
ROIC/WACC2.63
WACC6.75%
2.3 Liquidity
AON has a Current Ratio of 1.31. This is a normal value and indicates that AON is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.31, AON belongs to the top of the industry, outperforming 86.43% of the companies in the same industry.
AON has a Quick Ratio of 1.31. This is a normal value and indicates that AON is financially healthy and should not expect problems in meeting its short term obligations.
AON has a better Quick ratio (1.31) than 86.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.31 | ||
| Quick Ratio | 1.31 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.71% over the past year.
AON shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.68% yearly.
The Revenue has been growing slightly by 7.06% in the past year.
AON shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.43% yearly.
EPS 1Y (TTM)6.71%
EPS 3Y13.04%
EPS 5Y11.68%
EPS growth Q2Q9.48%
Revenue 1Y (TTM)7.06%
Revenue growth 3Y6.52%
Revenue growth 5Y4.43%
Revenue growth Q2Q5.14%
3.2 Future
The Earnings Per Share is expected to grow by 11.32% on average over the next years. This is quite good.
Based on estimates for the next years, AON will show a small growth in Revenue. The Revenue will grow by 4.52% on average per year.
EPS Next Y15.75%
EPS Next 2Y12.65%
EPS Next 3Y11.58%
EPS Next 5Y11.32%
Revenue Next Year6.72%
Revenue Next 2Y7.34%
Revenue Next 3Y6.73%
Revenue Next 5Y4.52%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 19.16 indicates a rather expensive valuation of AON.
Compared to the rest of the industry, the Price/Earnings ratio of AON indicates a slightly more expensive valuation: AON is more expensive than 61.43% of the companies listed in the same industry.
AON's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.06.
Based on the Price/Forward Earnings ratio of 15.63, the valuation of AON can be described as correct.
Based on the Price/Forward Earnings ratio, AON is valued a bit more expensive than the industry average as 60.71% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of AON to the average of the S&P500 Index (20.72), we can say AON is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.16 | ||
| Fwd PE | 15.63 |
4.2 Price Multiples
AON's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. AON is cheaper than 61.43% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, AON is valued a bit more expensive than 60.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.07 | ||
| EV/EBITDA | 10.74 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
AON has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.22
PEG (5Y)1.64
EPS Next 2Y12.65%
EPS Next 3Y11.58%
5. Dividend
5.1 Amount
AON has a yearly dividend return of 0.96%, which is pretty low.
Compared to an average industry Dividend Yield of 4.23, AON is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.41, AON's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.96% |
5.2 History
On average, the dividend of AON grows each year by 9.13%, which is quite nice.
AON has been paying a dividend for at least 10 years, so it has a reliable track record.
AON has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)9.13%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
19.23% of the earnings are spent on dividend by AON. This is a low number and sustainable payout ratio.
AON's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP19.23%
EPS Next 2Y12.65%
EPS Next 3Y11.58%
AON PLC-CLASS A
NYSE:AON (5/3/2024, 1:38:10 PM)
280.37
+0.28 (+0.1%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap55.60B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.96% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(8)
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EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.16 | ||
| Fwd PE | 15.63 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.22
PEG (5Y)1.64
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.34% | ||
| ROE | N/A | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 29.69% | ||
| PM (TTM) | 19.04% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.33
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.31 | ||
| Quick Ratio | 1.31 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)6.71%
EPS 3Y13.04%
EPS 5Y
EPS growth Q2Q
EPS Next Y15.75%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)7.06%
Revenue growth 3Y6.52%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y