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Aon PLC
AON : NYSE : Financial
$105.12 up1.96 | 1.90%
Today's Range: 102.56 - 105.37
Avg. Daily Volume: 1,425,300
04/29/16 - 4:03 PM ET

Financial Analysis


AON PLC's gross profit margin for the fourth quarter of its fiscal year 2015 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. AON PLC has very weak liquidity. Currently, the Quick Ratio is 0.27 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has decreased by 7.07% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q4 FY15 Q4 FY14
Net Sales ($mil)3288.03299.0
EBITDA ($mil)854.0818.0
EBIT ($mil)717.0670.0
Net Income ($mil)584.0459.0


Balance Sheet Q4 FY15 Q4 FY14
Cash & Equiv. ($mil)740.0768.0
Total Assets ($mil)27164.029772.0
Total Debt ($mil)5737.05582.0
Equity ($mil)6106.06571.0


Profitability Q4 FY15 Q4 FY14
Gross Profit Margin25.9724.8
EBITDA Margin25.9724.79
Operating Margin21.8120.31
Sales Turnover0.430.4
Return on Assets5.094.69
Return on Equity22.6821.26
Debt Q4 FY15 Q4 FY14
Current Ratio1.071.05
Debt/Capital0.480.46
Interest Expense68.067.0
Interest Coverage10.5410.0


Share Data Q4 FY15 Q4 FY14
Shares outstanding (mil)269.8280.0
Div / share0.30.25
EPS2.091.56
Book value / share22.6323.47
Institutional Own % n/a n/a
Avg Daily Volume1447291.01287128.0

Valuation


BUY. This stock's P/E ratio indicates a premium compared to an average of 17.00 for the Insurance industry and a discount compared to the S&P 500 average of 24.17. For additional comparison, its price-to-book ratio of 4.56 indicates a significant premium versus the S&P 500 average of 2.76 and a significant premium versus the industry average of 1.58. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, AON PLC proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
AON 21.10 Peers 17.00   AON 13.86 Peers 10.57

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

AON is trading at a premium to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

AON is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
AON 14.23 Peers 13.49   AON 0.64 Peers 1.60

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

AON is trading at a premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

AON trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AON 4.56 Peers 1.58   AON 4.71 Peers 13.39

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

AON is trading at a significant premium to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, AON is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
AON 2.38 Peers 1.33   AON -3.02 Peers -5.09

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

AON is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

AON has a sales growth rate that significantly exceeds its peers.

 

 

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