Willis Towers Watson PLC (NASDAQ: WLTW) became one of the largest multinational insurance advisory and brokerage firms at the start of 2016 with the merger of Willis Group Holdings PLC and Towers Watson & Company in a deal valued at $18 billion.

As of Jan. 8, 2020, the company had a market capitalization of about $26.3 billion.

Key Takeaways

  • Willis Towers Watson is a global company offering a range of professional consulting and support services related to insurance, pensions and retirement planning.
  • Its main competitors include Marsh & McLennan, Aon, and Gallagher.
  • WLTW's earnings per share growth over the past five years stood at 47.91%, well above its competitors.

The London-based firm offers professional consulting, support, and outsourcing services in the areas of insurance and reinsurance, pensions and retirement planning, health care insurance, technology, and risk management.

WLTW stock was up 33% in mid-December 2019 over a year before, compared to a financial services industry average of 37.7%, according to Zacks, which ranked it as a #3 "Hold" stock. Its stock price hit a new 52-week high of about $202 in mid-December 2019 after its announcement that it was buying PE Corporate Services (PECS), a South African advisory services firm.

Primary Willis Towers Watson competitors in the professional services industry include Marsh & McLennan Companies Inc. (NYSE: MMC), Aon PLC (NYSE: AON), and Arthur J. Gallagher & Company (NYSE: AJG).

How the Competitors Stack Up

In terms of market capitalization, Marsh & McLennan is top dog at $56.5 billion as of Jan. 8, 2020. Aon was in second place at $48.7 billion, Willis Towers Watson was in third place at $26.3 billion, and Arthur J. Gallagher in fourth place at $17.7 billion.

However, Willis Towers Watson was on top in terms of earnings per share growth over the past five years at 47.91%, compared to 11.29% for March & McLennan, 10.69% for Arthur J. Gallagher, and 7.91% for AON.

Marsh & McLennan Companies Inc.

Marsh & McLennan dates its beginnings to 1871, when co-founder Henry Marsh dropped out of Harvard to pursue his fortune as an insurance broker in Chicago, where the Great Fire had just wiped out much of the competition. In 1901, his company merged with that of Donald McLennan, who shared his enthusiasm for selling insurance products to the nation's railroad companies.

In January 2020, Wills Towers Watson had a market cap of $26.3 billion, placing it in third place among the four competitors.

It now has two major business segments, risk management and insurance services.

MMC stock traded at $111.24 on Jan. 8, 2020. Its shares were up more than 37% from a year before, compared to about 28% for the Standard & Poor's 500 Index. It had a dividend yield of 1.64%

Aon PLC

London-based Aon PLC was created by the 1982 merger of Ryan Insurance Group and the Combined Insurance Co. of America. It grew its global presence through acquisitions in Holland and Spain, among other countries.

Aon's recent acquisitions include CoverWallet, an electronic insurance platform for small- and medium-sized businesses, which it purchased in January 2020.

London-based Aon closed at $207.65 on Jan. 8, 2020. That's up 43.29% in a year. It had a dividend yield of .85%.

Arthur J. Gallagher & Company

Arthur J. Gallagher & Company, also known simply as Gallagher, was founded in 1927 as a Chicago insurance company and is headquartered in Itasca, Illinois.

The company grew through acquisitions, including nearly 400 made between 2010 and 2018. It now operates three business segments, including insurance brokerage, risk management, and professional services.

AJG closed the day at $94.85 on Jan. 8, 2020. That's a 30.95% increase in one year. The company had a dividend yield of 1.81%.