MARSH & MCLENNAN COS (MRSH) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MRSH - US5717481023 - Common Stock
183.16 USD
+2.51 (+1.39%)
183.16 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to MRSH. MRSH was compared to 149 industry peers in the Insurance industry. While MRSH has a great profitability rating, there are some minor concerns on its financial health. MRSH is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- MRSH had positive earnings in the past year.
- MRSH had a positive operating cash flow in the past year.
- MRSH had positive earnings in each of the past 5 years.
- In the past 5 years MRSH always reported a positive cash flow from operatings.
1.2 Ratios
- MRSH has a better Return On Assets (7.02%) than 90.60% of its industry peers.
- MRSH has a better Return On Equity (27.24%) than 93.29% of its industry peers.
- With an excellent Return On Invested Capital value of 13.33%, MRSH belongs to the best of the industry, outperforming 95.97% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for MRSH is in line with the industry average of 14.92%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.02% | ||
| ROE | 27.24% | ||
| ROIC | 13.33% |
ROA(3y)7.31%
ROA(5y)7.43%
ROE(3y)30.08%
ROE(5y)28.19%
ROIC(3y)13.69%
ROIC(5y)12.5%
1.3 Margins
- MRSH has a Profit Margin of 15.60%. This is in the better half of the industry: MRSH outperforms 79.87% of its industry peers.
- MRSH's Profit Margin has improved in the last couple of years.
- MRSH's Operating Margin of 25.20% is amongst the best of the industry. MRSH outperforms 87.25% of its industry peers.
- In the last couple of years the Operating Margin of MRSH has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.2% | ||
| PM (TTM) | 15.6% | ||
| GM | N/A |
OM growth 3Y4.55%
OM growth 5Y7.02%
PM growth 3Y1.54%
PM growth 5Y9.67%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- MRSH has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- MRSH has about the same amout of shares outstanding than it did 1 year ago.
- Compared to 5 years ago, MRSH has less shares outstanding
- The debt/assets ratio for MRSH is higher compared to a year ago.
2.2 Solvency
- An Altman-Z score of 2.74 indicates that MRSH is not a great score, but indicates only limited risk for bankruptcy at the moment.
- MRSH has a Altman-Z score of 2.74. This is amongst the best in the industry. MRSH outperforms 93.96% of its industry peers.
- MRSH has a debt to FCF ratio of 4.06. This is a neutral value as MRSH would need 4.06 years to pay back of all of its debts.
- MRSH's Debt to FCF ratio of 4.06 is in line compared to the rest of the industry. MRSH outperforms 42.95% of its industry peers.
- MRSH has a Debt/Equity ratio of 1.21. This is a high value indicating a heavy dependency on external financing.
- MRSH has a Debt to Equity ratio of 1.21. This is amonst the worse of the industry: MRSH underperforms 88.59% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.21 | ||
| Debt/FCF | 4.06 | ||
| Altman-Z | 2.74 |
ROIC/WACC1.69
WACC7.91%
2.3 Liquidity
- MRSH has a Current Ratio of 1.12. This is a normal value and indicates that MRSH is financially healthy and should not expect problems in meeting its short term obligations.
- MRSH has a better Current ratio (1.12) than 81.88% of its industry peers.
- A Quick Ratio of 1.12 indicates that MRSH should not have too much problems paying its short term obligations.
- The Quick ratio of MRSH (1.12) is better than 81.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.12 |
3. Growth
3.1 Past
- MRSH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.34%, which is quite good.
- Measured over the past years, MRSH shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.56% on average per year.
- Looking at the last year, MRSH shows a quite strong growth in Revenue. The Revenue has grown by 10.47% in the last year.
- MRSH shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.99% yearly.
EPS 1Y (TTM)10.34%
EPS 3Y12.5%
EPS 5Y13.56%
EPS Q2Q%13.5%
Revenue 1Y (TTM)10.47%
Revenue growth 3Y7.26%
Revenue growth 5Y7.99%
Sales Q2Q%11.48%
3.2 Future
- Based on estimates for the next years, MRSH will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.82% on average per year.
- The Revenue is expected to grow by 6.03% on average over the next years.
EPS Next Y10.15%
EPS Next 2Y8.69%
EPS Next 3Y8.81%
EPS Next 5Y9.82%
Revenue Next Year10.69%
Revenue Next 2Y7.81%
Revenue Next 3Y6.94%
Revenue Next 5Y6.03%
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 decreasing.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 19.28, MRSH is valued on the expensive side.
- 66.44% of the companies in the same industry are cheaper than MRSH, based on the Price/Earnings ratio.
- MRSH's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.21.
- The Price/Forward Earnings ratio is 17.62, which indicates a rather expensive current valuation of MRSH.
- 64.43% of the companies in the same industry are cheaper than MRSH, based on the Price/Forward Earnings ratio.
- When comparing the Price/Forward Earnings ratio of MRSH to the average of the S&P500 Index (24.26), we can say MRSH is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.28 | ||
| Fwd PE | 17.62 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MRSH indicates a slightly more expensive valuation: MRSH is more expensive than 60.40% of the companies listed in the same industry.
- MRSH's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.6 | ||
| EV/EBITDA | 13.99 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- MRSH has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.9
PEG (5Y)1.42
EPS Next 2Y8.69%
EPS Next 3Y8.81%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 1.94%, MRSH has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 2.43, MRSH has a dividend in line with its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.81, MRSH has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.94% |
5.2 History
- On average, the dividend of MRSH grows each year by 11.74%, which is quite nice.
- MRSH has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)11.74%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
- MRSH pays out 40.17% of its income as dividend. This is a bit on the high side, but may be sustainable.
- MRSH's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP40.17%
EPS Next 2Y8.69%
EPS Next 3Y8.81%
MARSH & MCLENNAN COS / MRSH FAQ
Can you provide the ChartMill fundamental rating for MARSH & MCLENNAN COS?
ChartMill assigns a fundamental rating of 5 / 10 to MRSH.
What is the valuation status for MRSH stock?
ChartMill assigns a valuation rating of 2 / 10 to MARSH & MCLENNAN COS (MRSH). This can be considered as Overvalued.
What is the profitability of MRSH stock?
MARSH & MCLENNAN COS (MRSH) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for MRSH stock?
The Price/Earnings (PE) ratio for MARSH & MCLENNAN COS (MRSH) is 19.28 and the Price/Book (PB) ratio is 5.92.
Can you provide the expected EPS growth for MRSH stock?
The Earnings per Share (EPS) of MARSH & MCLENNAN COS (MRSH) is expected to grow by 10.15% in the next year.