New York City-based Marsh & McLennan Companies, Inc. (MMC) is a global leader in professional services specializing in risk, strategy, and people solutions. With a market cap of $111.9 billion, MMC provides various services, including risk management, insurance broking, consulting, and investment advisory. Renowned for its extensive expertise and innovative solutions, the company supports businesses and organizations worldwide in navigating complex challenges and achieving sustainable growth.

Shares of Marsh & McLennan have gained 14.8% over the past 52 weeks, underperforming the broader S&P 500 Index ($SPX), which rallied nearly 31.3%. In 2024, MMC shares are up 21.8% on a YTD basis, lagging behind the SPX's 25.5% gain.

Narrowing the focus, MMC is underperforming the SPDR S&P Insurance ETF (KIE) 36.4% gains over the past 52 weeks and the exchange traded fund’s 36.1% returns on a YTD basis.

Marsh & McLennan Companies has trailed the broader market and peers, partly due to concerns about potential legal liabilities related to its insurance brokerage operations. Additionally, intensifying competition from established insurers and innovative insurtech startups has added pressure on its market positioning.

Following the Q3 earnings release on Oct. 17, MMC shares dipped slightly. The company reported adjusted earnings per share of $1.63, up 3.8% year-over-year, surpassing the consensus estimate of $1.61. Revenue totaled $5.70 billion, a 5.9% increase from the prior year but narrowly missing analysts' expectations. These results underscore steady earnings growth but highlight challenges in meeting revenue expectations amid a competitive environment.

For the current fiscal year, ending in December, analysts expect MMC’s EPS to grow 8.6% year over year to $8.68 on a diluted basis. The company's earnings surprise history is robust. It beat the consensus estimate in all four quarters.

Among the 22 analysts covering MMC stock, the consensus rating is a “Hold.” That’s based on four “Strong Buy” ratings, one “Moderate Buy,” 15 “Holds,” one “Moderate Sell,” and one “Strong Sell.” 

This configuration has been consistent over the past months.

On Nov. 21, Morgan Stanley's analyst Bob Huang maintained a “Hold” rating on Marsh & McLennan, with a price target of $230, which indicates that the stock trades at a premium. 

The mean price target of $232.85 represents a marginal premium to MMC’s current price levels. The Street-high price target of $259 suggests an upside potential of 12.3%.