Marsh & McLennan Companies (MMC) has been drifting lower this year, with the stock down roughly 14% year to date despite steady revenue and earnings growth, which sets up an interesting valuation check.
See our latest analysis for Marsh & McLennan Companies.
With the latest share price around $181.82 and a 90 day share price return of about negative 11 percent, momentum has clearly cooled, even though the five year total shareholder return near 70 percent still points to a solid long term compounding story.
If MMC’s recent wobble has you rethinking where you want steady compounding, it could be worth exploring fast growing stocks with high insider ownership for other ideas with strong alignment between management and shareholders.
So with Marsh & McLennan still growing earnings while trading roughly 30 percent below some intrinsic estimates, are investors getting a quality compounder at a discount, or is the market already pricing in its future growth?
Compared to the last close at $181.82, the most widely followed narrative sees Marsh & McLennan’s fair value materially higher, framing today’s pullback as an opportunity rather than a warning.
Strategic investments in digital transformation, advanced analytics, and AI (e.g., proprietary data tools for risk modeling, agentic interfaces) are expected to enhance operational efficiency and improve product/service offerings, enabling margin expansion and net earnings growth through improved client retention and lower cost to serve.
Read the complete narrative.
Want to see what happens when steady mid single digit growth meets rising margins and a richer earnings multiple usually reserved for faster growing sectors? The narrative leans on a bold earnings trajectory, firmer profitability and a premium valuation years from now, all reverse engineered into today’s fair value. Curious how those assumptions stack up against the current softer property and casualty backdrop and slower consulting demand?
Result: Fair Value of $212.35 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, softer property and casualty pricing and weaker discretionary consulting demand could cap margins and derail the premium multiple implied in this narrative.
Find out about the key risks to this Marsh & McLennan Companies narrative.
On simple earnings maths, Marsh & McLennan looks much richer than its sector, trading on 21.6 times earnings versus 12.8 times for the US Insurance industry, and above a 14.8 times fair ratio the market could drift toward. Is that premium resilience, or valuation risk building?