Marsh & McLennan Companies, Inc. (NYSE:MMC) reported third-quarter 2017 operating earnings per share of 79 cents per share, beating the Zacks Consensus Estimate by 1.3%. Earnings improved 14% year over year.
Marsh & McLennan’s consolidated revenues were $3.34 million, up 3% year over year on an underlying basis. Revenues beat the Zacks Consensus Estimate by 0.3%.
Total operating expenses of $2.74 billion increased 7.1% year over year.
The effective tax rate in the third quarter of 2017 was 26.2% compared with 26.8% in the prior-year period.
Segment Results
Risk and Insurance Services
Revenues at the Risk and Insurance Services segment were $1.8 billion, up 3% year over year on an underlying basis. Adjusted operating income also grew 12% to $337 million from the prior-year quarter.
A unit within this segment, Marsh, reported revenues of $1.5 million, up 3% year over year on an underlying basis. Underlying revenues grew 2% year over year in international operations on 9% growth in Latin America, 7% in the Asia Pacific, partly offset by 2% decline in the underlying revenues for EMEA (Europe, Middle East and Africa).
Another unit under this segment, Guy Carpenter, displayed revenue growth of 4% year over year on an underlying basis to $270 million.
Consulting
The Consulting segment's revenues increased 2% year over year on an underlying basis to $1.6 billion. Additionally, adjusted operating income increased 7% year over year to $330 million.
A unit within this segment – Mercer – reported revenues of $1.1 billion, remained flat year over year on an underlying basis.
Another unit, Oliver Wyman Group, reported revenues of $438 million, up 7% year over year on an underlying basis.
Marsh & McLennan Companies, Inc. Price, Consensus and EPS Surprise
Marsh & McLennan Companies, Inc. Price, Consensus and EPS Surprise | Marsh & McLennan Companies, Inc. Quote
Financial Update
Marsh & McLennan exited the quarter with cash and cash equivalents of $1.08 billion, up 5.1% from 2016 end.
As of Sep 30, 2017, Marsh & McLennan’s total assets were $19.7 million, up 8.2% from year-end 2016.
Total equity was $7.1 million, up 13.7% from year-end 2016.
Capital Deployment
The company repurchased 2.6 million shares of its common stock for $200 million in the third quarter.
Zacks Rank
Marsh & McLennan presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Among other players from the insurance industry that have reported their third-quarter earnings so far, the bottom line at CNO Financial Group, Inc. (NYSE:CNO) , The Hartford Financial Services Group, Inc. (NYSE:HIG) and The Travelers Companies, Inc.’s (NYSE:TRV) beat their respective Zacks Consensus Estimate.
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Marsh & McLennan Companies, Inc. (MMC): Free Stock Analysis Report
Hartford Financial Services Group, Inc. (The) (HIG): Free Stock Analysis Report
CNO Financial Group, Inc. (CNO): Free Stock Analysis Report
The Travelers Companies, Inc. (TRV): Free Stock Analysis Report
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