AON
Aon plc$338.77
Unclear
Target $308.83
Report: Mar 07, 2026Financial Services • Insurance - Brokers • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$338.77-8.8%
Rec: UnclearConviction: Medium
Entry Target
$237.56
(30% below current)
Fair Value
$308.83
(9% below current)
Stop Loss
$178.54
(47% below current)
Position Size
Starter
Time Horizon
Long-Term
Key Metrics
Live Snapshot
Market Data
52 Week High$401.03
52 Week Low$304.59
Avg. 3 Month Volume1.45M
Efficiency
LTM Gross Margin100.0%
LTM EBITDA Margin37.7%
LTM EBIT Margin32.1%
LTM Operating Margin25.3%
LTM ROA7.1%
LTM ROE46.0%
LTM ROIC26.0%
LTM ROCE20.6%
Capital Structure
Market Cap (MM)$69.2B
Enterprise Value (MM)$83.9B
Shares Outstanding215.30M
Total Debt (MM)$15.89B
Cash & Equivalents (MM)$1.20B
LTM Net Debt (MM)$14.70B
LTM Net Debt/EBITDA2.3x
Growth
TTM Rev. Growth9.4%
Last 3-Yr Rev. CAGR11.2%
Last 3-Yr EBITDA CAGR19.8%
Last 3-Yr EPS CAGR11.9%
Valuation
Street Target Price$404.80
LTM EV/Revenue4.9x
LTM EV/Gross Profit4.9x
LTM EV/EBIT15.2x
LTM EV/EBITDA12.9x
LTM P/E18.7x
LTM EV/FCF26.1x
LTM P/FCF21.5x
LTM P/TB2.4x
LTM P/B7.4x
Dividend Yield0.9%
Payout Ratio17.4%
Executive SummarySituation: Current price is $338.77 versus fair value $308.83 (-8.8% expected return), and valuation confidence is stable. Debate: Bull case depends on Achievement of Data Center Insurance Premium Volume >$10B in 2026. Bear case centers on Moat erosion from low-cost competitors like Arthur J. Conclusion: Recommendation is Unclear; maintain no position until reliability and catalyst evidence improve.
Bull Case
Aon's ABS platform creates a widening moat through superior analytics that drive mid-90s client retention and 11 points of new business contribution. The $2 trillion data center CapEx trend represents a monumental opportunity, with management targeting over $10 billion in premium volume by 2026.
Bear Case
Earnings quality is compromised by $7 billion in recurring non-GAAP adjustments required to portray a 32.4% adjusted operating margin. Recent capital allocation has been value-destructive, evidenced by an M&A effectiveness score of 0.6x and a negative incremental ROIC of -55.8%.
Key Catalysts
Mid-Term (6-18 months)Impact: High
Achievement of Data Center Insurance Premium Volume >$10B in 2026. This would validate management's 'monumental' growth narrative and prove...
Mid-Term (6-18 months)Impact: High
Realization of $2 Billion in NFP Free-Cash-Flow Synergies. Successful integration would address bear concerns regarding the value-destructiv...
Long-Term (18+ months)Impact: Moderate
Aon is relevant for analysis now as it enters the critical second year of the NFP integration and begins to report initial results from its...
Primary Risks
Concern: Medium
Moat erosion from low-cost competitors like Arthur J. Gallagher. If competitors successfully replicate Aon's analytics edge at a lower price...
Concern: High
Failure to improve negative incremental ROIC. Continued value-destructive reinvestment (currently -55.8%) would eventually lead to a structu...
Concern: Medium
The stewardship verdict is one of competent maintenance rather than exceptional value creation. While the board provides strong oversight th...
Recent Activity
2025-04-25SEC Filing (8-K)
-8.00%Aon reported Q1 2025 results with 16% total revenue growth and 5% organic growth, reaffirming 2025 guidance
2024-10-25SEC Filing (8-K)
+5.21%Aon reported Q3 2024 results with 26% total revenue growth and 7% organic growth, advancing NFP integration
2024-07-26SEC Filing (8-K)
+8.04%Aon reported Q2 2024 results with 18% total revenue growth and 6% organic growth following NFP acquisition
2024-04-26SEC Filing (8-K)
-6.85%Aon plc completed its acquisition of NFP for $13.0 billion enterprise value.
2023-12-20SEC Filing (8-K)
-6.03%Aon plc signed definitive agreement to acquire NFP for $13.4 billion enterprise value.
Valuation Table
9.8/10Decision Grade
Scenario Range
$179
Bear
$268
Base
$337
Bull
$339