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On Tuesday, BofA Securities made adjustments to their financial outlook for Willis Towers Watson (NASDAQ:WTW), reducing the firm’s price target from $349.00 to $341.00, while maintaining a Neutral rating on the stock. The $32.14 billion market cap company is currently trading near its InvestingPro Fair Value, with analyst targets ranging from $302 to $400. The revision follows the company’s release of its fourth quarter 2024 earnings, which revealed a higher adjusted operating margin and a tax rate below BofA Securities’ expectations.
Willis Towers Watson reported an adjusted operating margin of 36.1%, surpassing BofA Securities’ forecast of 35.3%, which positively impacted earnings by $0.20 per share. Additionally, a lower than anticipated tax rate contributed favorably by $0.13 per share. The company’s segment organic growth matched BofA Securities’ predictions at 5%, aligning with its overall revenue growth of 5.58%. InvestingPro data shows the company maintains strong financial health with an overall "GOOD" rating.
The fourth quarter 2024 adjusted earnings per share (EPS) also included a $0.23 per share pension adjustment. BofA Securities noted that starting in 2025, pension income will be excluded from adjusted EPS calculations, prompting an update to their financial model to reflect this change.
The firm’s share repurchase activity for the fourth quarter was consistent with BofA Securities’ expectations, totaling $350 million. Looking forward to 2025, the projections have been updated to anticipate quarterly repurchases of $375 million, amounting to $1.5 billion for the full year, which aligns with the company’s provided guidance. According to InvestingPro, WTW has maintained dividend payments for 22 consecutive years and shows a dividend yield of 1.06%. Get access to 12+ additional ProTips and comprehensive analysis in the Pro Research Report.
In other recent news, Willis Towers Watson, a global advisory and broking company, reported fourth-quarter earnings that exceeded analyst estimates. The company posted adjusted earnings per share of $8.13, surpassing the consensus forecast of $7.95. Revenue for the quarter came in at $3.04 billion, a 4% YoY increase, with organic revenue growth of 5% for both the quarter and the full year.
In other news, Willis Towers Watson named Mike Giacobbe as its new Client Strategy Leader for Corporate Risk & Broking in North America. Giacobbe, with a rich history in the industry, will be responsible for delivering a unified service model across various client segments and enhancing the use of Willis’s consulting and analytics tools.
These are recent developments in the company’s operations. Willis Towers Watson’s Health, Wealth & Career segment saw organic revenue growth of 3% in Q4, driven by increased project work and brokerage income in North America. The Risk & Broking segment posted 7% organic growth, fueled by higher levels of new business activity and strong client retention.
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