U.S. Markets open in 2 hrs 23 mins

A Look At Aon plc's (NYSE:AON) Exceptional Fundamentals

Simply Wall St

I've been keeping an eye on Aon plc (NYSE:AON) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe AON has a lot to offer. Basically, it is a financially-healthy company with a great history and a excellent future outlook. In the following section, I expand a bit more on these key aspects. For those interested in digging a bit deeper into my commentary, read the full report on Aon here.

Reasonable growth potential with proven track record and pays a dividend

Investors in search for stocks with room to flourish should look no further than AON, with its expected earnings growth of 25% which is expected to flow into an impressive return on equity of 63% over the next couple of years. Over the past year, AON has grown its earnings by 63%, with its most recent figure exceeding its annual average over the past five years. In addition to beating its historical values, AON also outperformed its industry, which delivered a growth of 2.0%. This paints a buoyant picture for the company.

NYSE:AON Past and Future Earnings, September 9th 2019

AON's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This indicates that AON has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. AON appears to have made good use of debt, producing operating cash levels of 0.22x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.

NYSE:AON Historical Debt, September 9th 2019

Next Steps:

For Aon, I've compiled three relevant factors you should look at:

  1. Valuation: What is AON worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether AON is currently mispriced by the market.
  2. Dividend Income vs Capital Gains: Does AON return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from AON as an investment.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of AON? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.