Company Reports

While growth slowed a bit sequentially and was a little weaker than what we've seen from peers, we think Willis Towers Watson still turned in solid results for the first quarter. Overall revenue growth was 4% and 5% on a reported and organic basis, respectively. This was roughly in line with our long-term expectations, and we think recent results show that the business has stabilized following the attrition issues it experienced in the wake of the failed Aon merger. We will maintain our $253 per share fair value estimate for the narrow-moat company and see shares as about fairly valued right now.

In January 2016, Towers Watson and Willis merged, creating a diversified brokerage and consulting firm with a mix similar to peers Aon and Marsh McLennan. While the combination is still significantly smaller than these industry leaders, the firms' record in pursuing this strategy suggested a favorable future, and results since the merger were fairly good. Over the long run, we think this combination sets up Willis Towers Watson to achieve moderate but stable growth and attractive profitability.

We think Willis Towers Watson's fourth-quarter results provided some further confirmation that the narrow-moat company is on the right track. Revenue grew 7% year over year, or 6% on an organic basis, and the company continues to achieve solid margin expansion. We will maintain our $241 per share fair value estimate and see shares as being fairly valued at the moment.

Willis Towers Watson’s third-quarter results showed that growth continues to accelerate and is now almost on par with the company’s larger peers. Overall, the quarter provides some confidence that management’s efforts to stabilize and grow the narrow-moat business are bearing some fruit. We will maintain our $241 fair value estimate and see shares as modestly undervalued.

In January 2016, Towers Watson and Willis merged, creating a diversified brokerage and consulting firm with a mix similar to peers Aon and Marsh McLennan. While the combination is still significantly smaller than these industry leaders, the firms' record in pursuing this strategy suggested a favorable future, and results since the merger were fairly good. Over the long run, we think this combination sets up Willis Towers Watson to achieve moderate but stable growth and attractive profitability.

Willis Towers Watson continued to see solid growth in the second quarter, with overall revenue up 7% year over year on an organic basis. The company continues to enjoy some tailwinds on this front, and growth remains well above our long-term expectations. However, management pointed to some profitability issues going forward, and we think the market is focused on the downward revision in the company’s 2024 earnings per share target. We remain comfortable with our $236 fair value estimate for the narrow-moat company, which we will maintain.

We think Willis Towers Watson showed positive momentum in the first quarter. The company has been struggling with operational issues over the past year or two, but this quarter suggests it has closed the growth gap with peers, with overall year-over-year organic growth coming in at 8%. We will maintain our $236 fair value estimate for the narrow-moat company and see the shares as about fairly valued.

In January 2016, Towers Watson and Willis merged, creating a diversified brokerage and consulting firm with a mix similar to peers Aon and Marsh & McLennan. While it’s still significantly smaller than these industry leaders, the firms' record in pursuing this strategy suggested a favorable future, and results since the merger have been fairly good. Over the long run, we think this combination sets up Willis Towers Watson to achieve moderate but stable growth and attractive profitability.

Willis Towers Watson’s fourth-quarter results largely show the company maintaining the trends from the previous quarter. The company seems to be past the attrition issues it has faced following the failure of the Aon merger. We will maintain our $231 fair value estimate and narrow moat rating.

In January 2016, Towers Watson and Willis merged, creating a diversified brokerage and consulting firm with a mix similar to peers Aon and Marsh & McLennan. While it’s still significantly smaller than these industry leaders, the firms' record in pursuing this strategy suggested a favorable future, and results since the merger have been fairly good. Over the long run, we think this combination sets up Willis Towers Watson to achieve moderate but stable growth and attractive profitability.

Willis Towers Watson showed good momentum in the third quarter and seems to be seeing ongoing recovery from its recent operational issues. That said, underlying growth continues to lag peers a bit, and the company still has a ways to go. We will maintain our $219 fair value estimate and narrow moat rating.

While its performance continues to materially lag what we are seeing at peers, Willis Towers Watson's second quarter showed some signs that management is starting to get a grip on the company's issues. We will maintain our $219 fair value estimate and narrow-moat rating.

Willis Towers Watson continued to struggle in the first quarter in terms of growth, but its cost-reduction efforts appear to be bearing some fruit, and the company is attempting to recover from its recent attrition issues. Overall, nothing in the quarter materially altered our long-term view, and we will maintain our $219 fair value estimate and narrow moat rating.

In January 2016, Towers Watson and Willis merged, creating a diversified brokerage and consulting firm with a mix similar to peers Aon and Marsh & McLennan. While it’s still significantly smaller than these industry leaders, the firms' record in pursuing this strategy suggested a favorable future, and results since the merger have been fairly good. Over the long run, we think this combination sets up Willis Towers Watson to achieve moderate but stable growth and attractive profitability.

Willis Towers Watson continued to underperform its peers in the fourth quarter, as the company deals with headwinds in its brokerage business following the failed merger with Aon. While the company still needs to move through a difficult period, we think the narrow-moat franchise can stabilize its results over time, viewing the year-over-year organic growth the firm generated during the quarter as a reasonable result given current circumstances. We will maintain our $219 per share fair value estimate.

Willis Towers Watson continued to see relatively strong growth in the third quarter as it benefited from tailwinds across its segments. The narrow-moat company has benefited this year from higher insurance market pricing and the macroeconomic rebound, and these tailwinds have combined with easy comparisons to produce outsize growth. However, the company has achieved only modest organic growth historically, and this is our expectation over the long term. We will maintain our $219 fair value estimate.

In January 2016, Towers Watson and Willis merged, creating a diversified brokerage and consulting firm with a mix similar to peers Aon and Marsh & McLennan. While it’s still significantly smaller than these industry leaders, the firms' record in pursuing this strategy suggested a favorable future, and results since the merger have been fairly good. Over the long run, we think this combination sets up Willis Towers Watson to achieve moderate but stable growth and attractive profitability.

As part of its proposed merger with Aon, Willis Towers Watson had agreed to sell a portion of its Willis Re business. After the Aon deal fell through, management had announced that it would continue to look at a sale of this business. That has now played out, with Willis Towers Watson agreeing to sell the Willis Re treaty reinsurance brokerage operations to Arthur Gallagher, the original buyer, for $3.25 billion plus potential additional consideration of up to $750 million based on three-year revenue targets. Based on data provided by Arthur Gallagher, the base price equates to 12.3 times EBITDA, which we view as reasonable. We will maintain our $206 fair value estimate and narrow moat rating.

Like its peers, Willis Towers Watson reported somewhat outsize growth in the second quarter as it benefited from tailwinds across its business. Overall revenue was up 8% year over year in the quarter, excluding currency impacts and acquisitions. We think favorable market conditions and easy comparisons will drive strong growth for the company this year, but we caution that modest and stable organic growth has been the norm for Willis Towers Watson and its peers historically and is our expectation over the long term. We will maintain our $206 fair value estimate and narrow moat rating.

In January 2016, Towers Watson and Willis merged, creating a diversified brokerage and consulting firm with a mix similar to peers Aon and Marsh & McLennan. While it’s still significantly smaller than these industry leaders, the firms' record in pursuing this strategy suggested a favorable future. Over the long run, we think this combination should set up Willis Towers Watson to achieve moderate but stable growth and attractive profitability levels.