Aon plc (NYSE:AON) Raises Dividend to $0.82 Per Share

Key Points

• Aon raised its quarterly dividend to $0.82 (a 10.1% increase), with an ex-dividend date of May 1 and payment on May 15, implying about a 1.0% yield.
• The dividend appears well covered with a 17.2% payout ratio; analysts forecast ~$21.29 in EPS next year, implying a projected payout ratio near 14% and continued capacity to sustain payouts.
• Operational and market snapshot: Aon beat quarterly EPS estimates at $4.85 (revenue $4.30B slightly below expectations), has a market cap of roughly $68.9B and a P/E of ~18.9, and carries a consensus price target of $401.81 with an average rating of Moderate Buy.

Aon plc (NYSE:AON - Get Free Report) announced a quarterly dividend on Friday, April 10th. Stockholders of record on Friday, May 1st will be paid a dividend of 0.82 per share by the financial services provider on Friday, May 15th. This represents a c) annualized dividend and a dividend yield of 1.0%. The ex-dividend date is Friday, May 1st. This is a 10.1% increase from AON's previous quarterly dividend of $0.75.

AON has raised its dividend payment by an average of 0.1%annually over the last three years. AON has a payout ratio of 17.2% meaning its dividend is sufficiently covered by earnings. Analysts expect AON to earn $21.29 per share next year, which means the company should continue to be able to cover its $2.98 annual dividend with an expected future payout ratio of 14.0%.

AON Price Performance

Shares of AON opened at $321.75 on Wednesday. AON has a 12-month low of $304.59 and a 12-month high of $381.00. The business's fifty day moving average is $325.67 and its 200 day moving average is $337.69. The company has a quick ratio of 2.03, a current ratio of 2.03 and a debt-to-equity ratio of 1.55. The stock has a market cap of $68.94 billion, a P/E ratio of 18.90, a P/E/G ratio of 1.77 and a beta of 0.83.

AON (NYSE:AON - Get Free Report) last announced its quarterly earnings results on Friday, January 30th. The financial services provider reported $4.85 earnings per share for the quarter, beating the consensus estimate of $4.75 by $0.10. AON had a net margin of 21.51% and a return on equity of 45.23%. The business had revenue of $4.30 billion for the quarter, compared to analysts' expectations of $4.38 billion. During the same quarter last year, the firm earned $4.42 EPS. The firm's revenue for the quarter was up 3.7% compared to the same quarter last year. Sell-side analysts anticipate that AON will post 18.98 earnings per share for the current fiscal year.

Wall Street Analyst Weigh In

Several equities research analysts have commented on AON shares. JPMorgan Chase & Co. decreased their price objective on shares of AON from $406.00 to $396.00 and set an "overweight" rating for the company in a research note on Thursday, April 9th. Keefe, Bruyette & Woods decreased their target price on AON from $416.00 to $401.00 and set an "outperform" rating for the company in a research report on Tuesday, April 7th. Citigroup raised their target price on AON from $402.00 to $412.00 and gave the company a "buy" rating in a research report on Tuesday, February 3rd. Barclays reduced their target price on shares of AON from $381.00 to $372.00 and set an "equal weight" rating for the company in a research report on Wednesday, April 8th. Finally, Jefferies Financial Group reissued a "buy" rating and set a $408.00 target price on shares of AON in a research report on Monday, February 2nd. Fourteen research analysts have rated the stock with a Buy rating and four have issued a Hold rating to the stock. Based on data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and a consensus price target of $401.81.

AON Company Profile

Aon plc is a global professional services firm that provides a broad suite of risk, retirement and health solutions to corporations, institutions and individuals. The company operates primarily as an insurance broker and risk adviser, helping clients identify, quantify and transfer risk across property, casualty, cyber and other areas. Aon also offers reinsurance brokerage and capital market solutions that connect insurers, reinsurers and corporate buyers.

In addition to traditional brokerage activities, Aon delivers consulting and outsourcing services in areas such as human capital, benefits, and retirement plan design and administration.

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