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AUTHOR
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49
member
9/09/21 5:50PM
Re: Investor day
48
I thought Investor Day delivered a constructive tone and new CEO sounded "institutional". The cumulative FCF guidance of $5-6bn (labeled 2022-2024) suggest a very strong FCF conversion from Adj Net Income per my relatively unsophisticated model... login to read the rest
Re: Re: Looking at "Like-for-Like" EPS after a quick exercise
45
Thanks for Krusty. I've only done a 2-day "shallow-dive" on this business/industry, I am inclined to agree with all your points above
I'd like to highlight 2 risk areas that I'm going to dig into more:
1) To... login to read the rest
Re: Looking at "Like-for-Like" EPS after a quick exercise
44
I would make a few comments on this valuation exercise:
1) I agree with Chalkbaggery's math. It's accurate to say the WLTW is less cheap vs. MMC on this basis.
2) I don't include AJG and BRO... login to read the rest
Looking at "Like-for-Like" EPS after a quick exercise
I too just got intrigued by this idea, and virtualodin brought up a great point in that the EPS disclosures are inconsistent across these peers, so I spent the past hour reconciling company-reported-adj-EPS vs. "true economic... login to read the rest
Re: Re: Re: Perhaps this helps get you off the ledge
41
Is it not the case that there are varying policies among these firms about excluding acqusition related amort from Adj. (and Cons.) EPS which accounts for a good chunk of the valuation gap? or are
Thanks for the post Value1929. I wasn't comparing WLTW consolidated organic growth to Aon/MMC, but more just the insurance divisions. That seems like the most fair apples to apples comparison. If you lay that out,
Shoulda added a tab for PE multiples on 2022 consensus!
WLTW: 15x
MMC: 23.5x
AJG: 24.9x
AON: 21.7x
Re merger arb selling, AON short interest has only dropped from 28mm shares to 14.2mm shares as of 8/13. So as you
Hopefully the organic revenue table below is visible for everyone. I think given the amount of consolidation and deals done in this space the past 5 & even 10 years you really have to take... login to read the rest
We are top 25 holders of the stock now. We came in post deal break. We are obviously very bullish for the reasons mentioned below. We think this business shouldn't trade for less than 18x... login to read the rest
Agreed, very frustrating. VIC should consider adding a feature / section to discuss timely / opportunistic ideas. The topics section is sometimes used that way, but hard for members to track.
While WLTW is not a super sexy biz, it is consistently profitable and very cheap here. I think post deal-break there is a decent run-way to 25%+ IRRs for a couple years from these levels--... login to read the rest
$2.1b of cash and $5.1b of debt as of 6/30 = $3b net debt. $1b Aon breakup fee came in 7/27 and $3.25b for Willis Re (ignoring earn out). Aren’t we already net cash? I... login to read the rest
You are not nuts. Seems really good here. CEO transition to longstanding Towers Watson alum and Haley protege is probably good. At a minimum eliminates a another potential distraction. Ignoring lease-related debt and the $750m... login to read the rest
Hi Martin. Interested to get your thoughts from here.
If WLTW does $10 this year and then grows EPS next year by 12%, which seems reasonable you are 11.20 of EPS in 2019. If you put... login to read the rest
Hey Martin,
Wondering if you have any thoughts here? Stock has traded off (it seems in a reaction to WLTW being a low tax payer). Looks like it's sub 14x on 2019 for a double digit
Very helpful, thank you! All of that makes sense.
I think them getting 2-4% rev growth is v. important for the multiple, but I agree on EPS growth and the levers. Historically, you are right, they... login to read the rest
Thanks Martin. What level of revenue synergies are incorporated in that EPS range and the 2.5% to 4.5% organic growth targets? When asked during the investor day, I didn't understand most of mgmt's responses.....thanks.
Hi Martin,
Two quick questions for you on this one around our previous discussion.
1. How much stock do you expect WLTW to buyback in 2016 given their well telegraphed issues with Moodys?
2. The bear case that... login to read the rest
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