Aon plc (AON) is a British multinational corporation that offers risk management services, insurance and reinsurance brokerage, human resource consulting and outsourcing services globally. With operations n more than 120 countries, the company utilizes its resources to develop individual as well as group insurance programs. It offers its services globally across personal lines, mid-market companies and multinational companies.
Aon has been upfront in undertaking inorganic growth strategies to boost its operational strength. Recently, Aon Hewitt, the global talent, retirement and health solutions business of Aon acquired UK-based Kloud, the largest dedicated Workday consultancy outside the U.S. This marked an important step for Aon Hewitt as the integration of Kloud will make Aon Hewitt the largest Workday services provider in Europe.
However, increased debt levels, competitive pressure and pressures from lawsuits raise caution.
Though the company faces competition, positive tidings have been driving bullish sentiments as evident from consensus estimate being north bound. Aon does have a decent history when it comes to earnings as the stock has beaten estimates in the last four quarters, making for an average surprise of 7.35%.
Currently, Aon has a Zacks Rank #3 (Hold), but that could definitely change following its earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:
Earnings: Aon beats our earnings estimates. Our consensus called for EPS of $1.86, and the company reported EPS of $1.89.
Revenue: Revenues slightly missed our estimate. Our consensus called for revenues of $3.4 billion, and the company reported revenues of $3.3 billion.
Key Stats to Note: Aon has implemented a number of restructuring plans that has helped it control mounting expenses and also generate savings. As a result operating expenses decreased year over year in the quarter and contributed to margin expansion. Restructuring savings in the fourth quarter associated with the Aon Hewitt restructuring program is estimated at $101 million, up from $94 million in the year-ago quarter.
Foreign currency exchange rates had an unfavorable impact of 6 cents on the adjusted net income from continuing operations during the quarter.
Although cash flow increased during the quarter, it was more than offset by an increase in capital expenditure leading to a 1% decrease in free cash flow.
Check back later for our full write up on this AON earnings report later!
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment