From Nasdaq.:

Aon plc AON is positioned for growth with strong property and casualty business, organic revenue growth, and strategic acquisitions. The company operates in 120 countries with a market cap of $58.3 billion. The Zacks Rank #3 stock has a consensus estimate for 2023 earnings at $14.35 per share and 2024 earnings at $16.22. Revenues for 2023 are estimated at $13.4 billion, with mid-single-digit organic growth expected. The company’s successful growth strategy includes acquisitions and partnerships, positioning it for sustained long-term growth.

Aon’s acquisition of NFP for $13.4 billion and partnerships with companies like Cover Whale and PayPal are key contributors to its growth strategy. Aon’s return on capital of 29.5% outpaces the industry average, highlighting its ability to generate substantial returns. The company has also hit the $2 billion milestone in 401(k) assets under administration and commitments, while expecting high-single-digit free cash flow growth for 2023.

Investors should be cautious of Aon’s high long-term debt, reaching nearly $10 billion, with a long-term debt-to-capital ratio standing at 98.4%. This can affect the company’s inorganic growth strategies. Interest expenses have jumped 22% year over year due to the debt-heavy balance sheet. Despite these challenges, a strategic plan of action will drive growth and reduce leverage in the long term.

For investors interested in the finance sector, better-ranked stocks include Ryan Specialty Holdings, Chubb Limited, and Brown & Brown, each with a Zacks Rank #2 (Buy). Ryan Specialty Holdings is expected to see 20.9% earnings growth, Chubb Limited is forecasted for a 25.9% earnings increase, and Brown & Brown is pegged for a 21.1% earnings growth for 2023. This is supplemented by year-over-year revenue growth estimates of 20.2%, 10.8%, and 21.1% respectively.



Read more: Here’s Why Prudent Investors are Retaining AON Shares Now