New York-based, Marsh & McLennan Companies, Inc. (MMC) is a professional services company that provides advice and solutions to clients in the areas of risk, strategy, and people. Valued at a market cap of $112.8 billion, the company offers insurance brokerage, risk management, reinsurance, talent management, investment advisory, and management consulting services.
Companies worth $10 billion or more are generally described as “large-cap” stocks, and Marsh & McLennan fits right into that category with its market cap exceeding this threshold. The professional services company’s more than 85,000 colleagues advise clients in over 130 countries and help make organizations more successful and societies more resilient.
MMC is currently trading 2.4% below its 52-week high of $235.50, reached on Nov. 29. Shares of MMC marginally declined over the past three months, lagging behind the broader SPDR S&P Insurance ETF’s (KIE) 8.1% gains during the same time frame.
Moreover, in the longer term, MMC has gained nearly 21.3% on a YTD basis, underperforming KIE’s 34.8% returns. Shares of MMC are up 16.4% over the past 52 weeks, lagging behind KIE’s 33.7% gains over the same time frame.
To confirm its bullish trend, MMC has been consistently trading above its 200-day moving average since the past year, and has remained above its 50-day moving average since late November.
MMC’s underperformance relative to its industry peers is partially due to concerns about possible legal liabilities associated with its insurance brokerage operations.
On Oct. 17, shares of MMC fell marginally after its mixed Q3 earnings release. The company’s adjusted EPS of $1.63, improved 3.8% on an annual basis and surpassed the forecasted figure of $1.61. However, its revenue increased 5.9% year-over-year to $5.7 billion, but slightly missed the consensus estimates.
MMC’s underperformance becomes even more evident when compared to its rival, Aon plc (AON) which gained 17.1% over the past 52 weeks and 31.3% on a YTD basis.
Looking at MMC’s recent underperformance relative to its industry peers, analysts remain cautious about its prospects. The stock has a consensus rating of “Hold” from the 22 analysts covering it, and the mean price target of $233.20 suggests a slight 1.5% premium to its current levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here. More news from BarchartThe views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
