Can AON Beat Q4 Earnings on Commercial Risk Solutions Strength?

Leading global insurer Aon plc AON is set to report fourth-quarter 2024 results on Jan. 31, 2025, before the opening bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is currently pegged at $4.24 per share on revenues of $4.19 billion.See the Zacks Earnings Calendar to stay ahead of market-making news.The fourth-quarter earnings estimate has remained stable over the past week. The bottom-line projection indicates a year-over-year increase of 9%. The Zacks Consensus Estimate for quarterly revenues suggests year-over-year growth of 24.2%.Image Source: Zacks Investment ResearchAON missed the consensus estimate for earnings in three of the last four quarters and beat only once, with the average surprise being negative 0.5%.Aon plc Price and EPS Surprise Aon plc price-eps-surprise | Aon plc QuoteQ4 Earnings Whispers for AONNonetheless, our proven model predicts a likely earnings beat for the company this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That’s precisely the case here.AON has an Earnings ESP of +2.75% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.You can see the complete list of today’s Zacks #1 Rank stocks here.What’s Shaping AON’s Q4 Results?The performance of Commercial Risk Solutions in the fourth quarter is likely to have benefited from new business growth and solid retention rates. Additionally, strong growth in various regions, including North America, is expected to have contributed positively to their results.The Zacks Consensus Estimate for the Commercial Risk Solutions line’s revenues indicates 16.7% growth from $1.91 billion a year ago, whereas our model predicts a 16% increase. We expect the unit to witness 6% organic revenue growth in the quarter under discussion.The consensus mark for the Health Solutions line’s fourth-quarter revenues suggests 46.3% growth from the year-ago level, while our model estimate indicates a 46% increase. The segment is likely to have been supported by global expansion in the core health and benefits brokerage business. Additionally, strong growth in EMEA, Asia and the Pacific, and Latin America regions are expected to have aided the revenue line in the quarter under review.The Zacks Consensus Estimate for Reinsurance Solutions' revenues indicates growth of 4.4% from $332 million recorded a year ago, while our model estimate suggests a 4% increase. Favorable retention rates, new business generation and facultative placement growthare expected to have benefited the unit.The consensus estimate for fourth-quarter revenues in the Wealth Solutions segment suggests a 34.2% increase from the previous year’s $377 million, whereas our model foresees a 33% rise. The unit is likely to have been supported by sustained demand for advisory services and project-related activities during the quarter under review.The factors mentioned above are expected to have contributed to the company's year-over-year growth, positioning it for an earnings beat. However, the positives are likely to have been partially offset by increased expenses from significant investments in priority areas for long-term growth, coupled with an uptick in certain discretionary and other costs.Our model suggests the total operating expenses in the fourth quarter to have increased by more than 21%, attributed to increased costs related to higher compensation and benefits. Specifically, the estimate for other general expenses is set at nearly $533 million, while compensation and benefits costs are pegged at $2.09 billion.Other Stocks That Warrant a LookHere are some other companies worth considering from the broader Finance space, as our model shows that these, too, have the right combination of elements to beat on earnings this time around:Fidelity National Financial, Inc. FNF has an Earnings ESP of +1.12% and is a Zacks #2 Ranked player.The Zacks Consensus Estimate for Fidelity National’s bottom line for the to-be-reported quarter is pegged at $1.18 per share, indicating 57.3% year-over-year growth. It has remained stable over the past week. The consensus estimate for FNF’s revenues is pegged at $3.33 billion.American International Group, Inc. AIG has an Earnings ESP of +2.65% and a Zacks Rank of 3.The Zacks Consensus Estimate for American International’s earnings for the to-be-reported quarter is pegged at $1.26 per share. The consensus estimate for revenues is pegged at $6.77 billion. AIG beat earnings estimates in three of the past four quarters and missed once, with the average surprise being 2.9%.Brighthouse Financial, Inc. BHF has an Earnings ESP of +0.83% and a Zacks Rank of 3.The Zacks Consensus Estimate for Brighthouse Financial’s bottom line for the to-be-reported quarter indicates 52.1% year-over-year growth. BHF beat earnings estimates in two of the past four quarters and missed twice.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report American International Group, Inc. (AIG): Free Stock Analysis Report Aon plc (AON): Free Stock Analysis Report Fidelity National Financial, Inc. (FNF): Free Stock Analysis Report Brighthouse Financial, Inc. (BHF): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks