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Willis Towers Watson (WTW) Moves 3.6% Higher: Will This Strength Last?

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Willis Towers Watson (WTW) shares soared 3.6% in the last trading session to close at $204.95. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 4.9% loss over the past four weeks.

Willis Towers’ revenues should continue to benefit from solid customer retention levels and growing new business. The insurer’s growth strategy focuses on core opportunities with the highest growth and returns, which include gaining market share in Risk and Broking and Individual Marketplace.

Willis Towers' strategic acquisitions have expanded its geographical footprint in the last few years. Its geographic diversification adds capabilities, boosts its portfolio and supports overall growth.

This advisory, broking and solutions company is expected to post quarterly earnings of $2.32 per share in its upcoming report, which represents a year-over-year change of -12.8%. Revenues are expected to be $2.08 billion, down 9.1% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Willis Towers Watson, the consensus EPS estimate for the quarter has been revised 1.9% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on WTW going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Willis Towers Watson is a member of the Zacks Insurance - Brokerage industry. One other stock in the same industry, Arthur J. Gallagher (AJG), finished the last trading session 3.3% higher at $165.25. AJG has returned -0.6% over the past month.

Arthur J. Gallagher's consensus EPS estimate for the upcoming report has changed +0.1% over the past month to $1.69. Compared to the company's year-ago EPS, this represents a change of +44.4%. Arthur J. Gallagher currently boasts a Zacks Rank of #3 (Hold).


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