Marsh & McLennan Companies Inc

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MMC : NYSE : Financial
$76.15 up 1.1 | 1.4%
Today's Range: 75.1 - 76.129
Avg. Daily Volume: 1736600.0
05/25/17 - 12:44 PM ET

Financial Analysis


MARSH & MCLENNAN COS's gross profit margin for the first quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. MARSH & MCLENNAN COS has average liquidity. Currently, the Quick Ratio is 1.32 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 2.20% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q1 FY17 Q1 FY16
Net Sales ($mil)3503.03330.0
EBITDA ($mil)922.0846.0
EBIT ($mil)802.0735.0
Net Income ($mil)569.0481.0


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)930.0918.0
Total Assets ($mil)18969.018128.0
Total Debt ($mil)5891.05013.0
Equity ($mil)6532.06679.0


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin26.3225.41
EBITDA Margin26.3225.4
Operating Margin22.8922.07
Sales Turnover0.70.72
Return on Assets9.788.81
Return on Equity28.4123.88
Debt Q1 FY17 Q1 FY16
Current Ratio1.391.52
Debt/Capital0.470.43
Interest Expense58.046.0
Interest Coverage13.8315.98


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)515.02521.52
Div / share0.340.31
EPS1.090.91
Book value / share12.6812.81
Institutional Own % n/a n/a
Avg Daily Volume1758500.02006280.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 29.46 for the Insurance industry and a discount compared to the S&P 500 average of 25.02. For additional comparison, its price-to-book ratio of 5.87 indicates a significant premium versus the S&P 500 average of 3.00 and a significant premium versus the industry average of 1.80. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
MMC 20.87 Peers 29.46   MMC 17.57 Peers 10.60

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

MMC is trading at a significant discount 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.

MMC 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
MMC 17.74 Peers 15.34   MMC 1.60 Peers 1.62

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

MMC is trading at a significant premium to its peers.

 

Average. 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.

MMC trades at a valuation on par to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
MMC 5.87 Peers 1.80   MMC 19.39 Peers 19.97

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.

MMC is trading at a significant premium to its peers.

 

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

MMC is expected to keep pace with its peers on the basis of earnings growth.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
MMC 2.87 Peers 1.41   MMC 3.09 Peers 11.83

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.

MMC is trading at a significant premium to its industry.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

MMC significantly trails its peers on the basis of sales growth

 

 

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