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Investing.com - Raymond (NSE:RYMD) James has reiterated its Outperform rating and $240.00 price target on Marsh & McLennan (NYSE:MMC), maintaining a positive outlook despite several industry headwinds.
The firm believes that challenges such as slowing economic growth, deteriorating pricing in large account business, and cyclical volatility in consulting are already reflected in MMC’s valuation compared to peers. Raymond James specifically noted its preference for MMC’s middle market business exposure relative to competitor AON.
Marsh & McLennan reported 4.0% organic revenue growth in the second quarter of 2025, slightly below the consensus estimate of 4.3%. This underperformance was partly attributed to just 2% organic growth in Wealth year-over-year and a 5% decline in Career segment revenue during the same period.
The company’s Global Insurance Market Index showed a 4% decrease in commercial lines rates during Q2 2025, following a 3% decline in the previous quarter. This trend was primarily driven by property insurance rates, despite increased catastrophe losses in the first half of the year, while global casualty rates increased by 4%.
Raymond James has raised its 2025 operating EPS estimate for Marsh & McLennan to $9.45 following the Q2 beat, while maintaining its 2026 and 2027 estimates at $10.05 and $10.90 respectively. The firm’s projections include modest accretion from the McGriff acquisition in 2025, with more significant contributions expected in 2026.
In other recent news, Marsh & McLennan Companies Inc. reported its second-quarter earnings for 2025, surpassing Wall Street expectations with an adjusted earnings per share of $2.72, compared to the forecasted $2.67. The company’s revenue reached $7 billion, slightly exceeding the anticipated $6.94 billion, marking a 12% increase year-over-year. Additionally, Marsh & McLennan announced a 10% dividend increase and completed $300 million in share repurchases during the quarter. Analyst firm Jefferies maintained a Hold rating on Marsh & McLennan’s stock while raising its price target to $229, noting that the company delivered an in-line quarter amid macroeconomic uncertainty. Marsh & McLennan remains confident in achieving mid-single-digit organic growth and margin expansion despite challenges in its consulting business. The Risk and Insurance Services segment performed in line with expectations, and the company anticipates continued margin expansion for the eighteenth consecutive year. The firm is also focusing on AI and technology investments to drive future growth.
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