Aon plc
Aon plc Fundamental Analysis
Aon plc (AON) shows strong financial fundamentals with a PE ratio of 18.94, profit margin of 21.51%, and ROE of 45.99%. The company generates $17.2B in annual revenue with strong year-over-year growth of 17.36%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 75.2/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze AON's fundamental strength across five key dimensions:
Efficiency Score
WeakAON struggles to generate sufficient returns from assets.
Valuation Score
ExcellentAON trades at attractive valuation levels.
Growth Score
ModerateAON shows steady but slowing expansion.
Financial Health Score
ModerateAON shows balanced financial health with some risks.
Profitability Score
ExcellentAON achieves industry-leading margins.
Key Financial Metrics
Is AON Expensive or Cheap?
P/E Ratio
AON trades at 18.94 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, AON's PEG of 0.52 indicates potential undervaluation.
Price to Book
The market values Aon plc at 7.48 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 8.35 times EBITDA. This is generally considered low.
How Well Does AON Make Money?
Net Profit Margin
For every $100 in sales, Aon plc keeps $21.51 as profit after all expenses.
Operating Margin
Core operations generate 26.03 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $45.99 in profit for every $100 of shareholder equity.
ROA
Aon plc generates $7.28 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Aon plc produces operating cash flow of $3.48B, showing steady but balanced cash generation.
Free Cash Flow
Aon plc generates strong free cash flow of $3.22B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $14.96 in free cash annually.
FCF Yield
AON converts 4.60% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
18.94
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.52
vs 25 benchmark
P/B Ratio
Price to book value ratio
7.48
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.07
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.77
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.11
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.46
vs 25 benchmark
ROA
Return on assets percentage
0.07
vs 25 benchmark
ROCE
Return on capital employed
0.16
vs 25 benchmark
How AON Stacks Against Its Sector Peers
| Metric | AON Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 18.94 | 18.86 | Neutral |
| ROE | 45.99% | 847.00% | Weak |
| Net Margin | 21.51% | 4202.00% | Weak |
| Debt/Equity | 1.77 | 0.91 | Weak (High Leverage) |
| Current Ratio | 1.11 | 667.17 | Neutral |
| ROA | 7.28% | -21543.00% (disorted) | Weak |
AON outperforms its industry in 0 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Aon plc's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
60.88%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
95.53%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
86.68%
Industry Style: Value, Dividend, Cyclical
High Growth