Yahoo Finance Will Aon (AON) Keep Its Beat Streak Alive in Q1 Earnings?
Aon plc AON is slated to report first-quarter 2023 earnings on Apr 28, before the opening bell. The company’s earnings beat estimates in the last reported quarter.
Trend in Estimate Revision
The Zacks Consensus Estimate for first-quarter earnings per share of $5.26 has witnessed three upward revisions and no downward movement in the past 30 days. The estimate is indicative of an 8.9% increase from the year-ago reported figure. The Zacks Consensus Estimate for first-quarter revenues is pegged at $3.8 billion, suggesting a rise of 3.8% from the year-ago reported figure, whereas our estimate indicates 2.1% growth.
Aon beat earnings estimates in three of the trailing four quarters and missed once, delivering an average surprise of 2.1%. This is depicted in the graph below.
Aon plc Price and EPS Surprise
Aon plc price-eps-surprise | Aon plc Quote
What the Zacks Model Says
Our proven model predicts an earnings beat for Aon this time around. The combination of a positive Earnings ESPand a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is exactly the case here.
Earnings ESP: AON has an Earnings ESP of +0.80%. This is because the Most Accurate Estimate of $5.30 is pegged higher than the Zacks Consensus Estimate of $5.26. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: AON currently carries a Zacks Rank of 3.
Factors Driving Q1 Results
Commercial Risk Solutions’ performance is likely to have been aided by growth across various regions, resulting from strong business generation and retention, and management of the renewal book portfolio. Strong growth in its affinity business is likely to have aided the business.
The Zacks Consensus Estimate for the Commercial Risk Solutions line’s revenues is pegged at $1,741 million, suggesting an increase from the prior-year reported figure of $1,719 million. Our estimate for the metric is pegged at $1,719 million for the first quarter.
The Zacks Consensus Estimate for the Health Solutions line’s first-quarter revenues is pegged at $657 million, indicating an increase from the year-ago period’s reported figure of $638 million. Enhancement in offerings, platforms and tools, and client’s increasing attention toward the health of employees, engagement and well-being are likely to have supported health and benefits, and the human capital business in the first quarter.
The consensus mark for Reinsurance Solutions’ revenues is pegged at $1,057 million, indicating an increase from the $976 million reported a year ago. Our estimate for the first quarter suggests a 6.9% year-over-year increase. The segment is likely to have witnessed growth in the to-be-reported quarter due to data-driven analytics solutions and strategic advice, helping clients better navigate difficult situations. Moreover, consistent business generation and growth in capital market transactions are likely to have positioned the company for year-over-year growth and an earnings beat.
However, the consensus mark for Wealth Solution’s revenues in the first quarter indicates a 1.7% year-over-year decline, while our estimate suggests a 2% fall. Unfavorable effects of currency exchange are likely to have impacted the company’s margins.
Also, rising expenses due to noteworthy investments in Aon Business Services-enabled technology platforms for long-term growth and an increase in certain discretionary expenses are likely to have affected bottom-line growth.
Other Stocks to Consider
Here are some other companies from the Finance space, which according to our model, have the right combination of elements to beat on earnings this time around:
American Equity Investment Life Holding Company AEL has an Earnings ESP of +1.44% and a Zacks Rank of 3. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at $1.09, indicating an increase of 18.5% from the year-ago reported figure.You can see the complete list of today’s Zacks #1 Rank stocks here.
AEL’s earnings beat estimates in two of the last four reported quarters and missed in the other two.
Aflac Incorporated AFL has an Earnings ESP of +1.20% and a Zacks Rank of 3. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at $1.38, indicating a decrease of 2.8% from the year-ago reported figure. AFL’s earnings beat estimates in each of the last four reported quarters.
Axos Financial, Inc. AX has an Earnings ESP of +0.62% and a Zacks Rank of 3. The Zacks Consensus Estimate for first-quarter 2023 earnings stands at $1.22, implying an increase of 16.2% from the year-ago reported quarter.
AX’s earnings beat estimates in each of the last four reported quarters.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Aflac Incorporated (AFL) : Free Stock Analysis Report
Aon plc (AON) : Free Stock Analysis Report
American Equity Investment Life Holding Company (AEL) : Free Stock Analysis Report
AXOS FINANCIAL, INC (AX) : Free Stock Analysis Report
