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With a market cap of $82.3 billion, Dublin, Ireland-based Aon plc (AON) is a leading professional services firm offering risk management, insurance brokerage, and human capital solutions worldwide. It serves clients through four main segments: Commercial Risk; Reinsurance; Wealth; and Health Solutions.
Shares of the insurance brokerage have underperformed the broader market over the past 52 weeks. AON has risen 15.9% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 30.6%. However, in 2024, shares of AON are up 31.3%, outperforming SPX’s 23.6% gain on a YTD basis.
Focusing more closely, Aon has lagged behind the Financial Select Sector SPDR Fund’s (XLF) 41.8% return over the past 52 weeks and a 32% YTD rise.
Shares of Aon climbed 5.2% on Oct. 25 after reporting better-than-expected Q3 adjusted earnings of $2.72 per share and revenue of $3.7 billion. The 26% year-over-year revenue growth, driven by 7% organic growth and 19% from acquisitions, highlighted strong performances in the Commercial Risk, Reinsurance, and Health Solutions segments. Investors were also encouraged by progress in the Aon United Restructuring program, which is set to deliver significant cost savings and bolster long-term profitability.
For the current fiscal year, ending in December, AON is expected to report an EPS of $15.42, reflecting a 9.1% year-over-year growth. The company’s earnings surprise history is mixed. It beat the consensus estimates in one of the last four quarters while missing on three other occasions.
Among the 21 analysts covering the stock, the consensus rating is a “Hold.” That’s based on five “Strong Buy” ratings, one “Moderate Buy,” 12 “Holds,” one “Moderate Sell,” and two “Strong Sells.”
This configuration is slightly more bullish than three months ago, with four “Strong Buy” ratings on the stock.
On Nov. 5, BMO Capital raised its price target on Aon to $380, citing stronger 2025/26 EPS estimates driven by higher revenue and lower interest expense. The firm also noted the potential for Aon to pursue a significant acquisition beyond its traditional brokerage-focused business model.
As of writing, AON is trading below the mean price target of $381.05. The Street-high price target of $432, implies a potential upside of 13.5% from the current price.
