AON (NYSE:AON) Shares Gap Down – Here’s What Happened

Shares of Aon plc (NYSE:AON) gapped down prior to trading on Monday . The stock had previously closed at $355.40, but opened at $340.00. AON shares last traded at $332.1210, with a volume of 133,063 shares trading hands.

Trending Headlines about AON

Here are the key news stories impacting AON this week:

• Positive Sentiment: Analysts maintain bullish ratings: Keefe, Bruyette & Woods raised its price target to $417 from $412 and kept an “outperform” rating. Cantor Fitzgerald maintained “overweight” with a $433 target, while Mizuho retained “outperform” despite reducing its target to $398. All targets imply substantial upside from the referenced share price.
• Positive Sentiment: USI expands Aon’s middle-market and specialty capabilities: The acquisition would strengthen Aon’s reach among medium-sized businesses, add risk management, health benefits and retirement-plan services, and increase exposure to the fast-growing excess and surplus insurance market. Aon expects $395 million in annual run-rate adjusted EBITDA benefits from revenue and cost synergies and adjusted-EPS accretion beginning in 2028. Aon to acquire USI to establish the premier U.S. middle-market platform
• Neutral Sentiment: Transaction remains subject to closing conditions: The deal is expected to close in the fourth quarter, pending regulatory approvals. USI CEO Mike Sicard is expected to become Aon’s president and global CEO of Middle Market after completion. Aon CEO says insurance broker seeks to build premier middle-market platform
• Negative Sentiment: Large debt-funded purchase raises financial and execution concerns: Aon plans to finance the $17 billion transaction with new debt, increasing leverage and placing pressure on management to realize projected synergies. Investors have characterized the acquisition as an expensive bet on middle-market growth, contributing to a sharp decline in the shares after the announcement. Aon’s $17 billion USI deal: A costly bet on middle-market growth

Wall Street Analyst Weigh In

Several research analysts have issued reports on the stock. Deutsche Bank Aktiengesellschaft reiterated a “hold” rating on shares of AON in a report on Tuesday. Wells Fargo & Company lowered their price target on shares of AON from $419.00 to $383.00 and set an “overweight” rating for the company in a research report on Tuesday. Mizuho dropped their price objective on shares of AON from $437.00 to $398.00 and set an “outperform” rating on the stock in a research note on Tuesday. Piper Sandler reduced their price objective on shares of AON from $391.00 to $349.00 and set a “neutral” rating for the company in a research note on Tuesday. Finally, JPMorgan Chase & Co. upped their target price on AON from $396.00 to $412.00 and gave the stock an “overweight” rating in a report on Monday, July 13th. Twelve equities research analysts have rated the stock with a Buy rating and seven have given a Hold rating to the company. According to MarketBeat, AON has a consensus rating of “Moderate Buy” and an average target price of $399.88.

AON Stock Up 1.6%

The business has a fifty day moving average price of $353.36 and a two-hundred day moving average price of $334.07. The firm has a market capitalization of $69.26 billion, a price-to-earnings ratio of 18.00, a price-to-earnings-growth ratio of 1.66 and a beta of 0.66. The company has a debt-to-equity ratio of 1.34, a current ratio of 1.54 and a quick ratio of 1.54.

AON (NYSE:AON) last issued its quarterly earnings results on Wednesday, July 29th. The financial services provider reported $3.81 earnings per share for the quarter, topping the consensus estimate of $3.80 by $0.01. The company had revenue of $4.25 billion for the quarter, compared to the consensus estimate of $4.28 billion. AON had a net margin of 22.27% and a return on equity of 42.13%. AON’s quarterly revenue was up 2.2% on a year-over-year basis. During the same quarter in the prior year, the company earned $3.49 EPS. On average, equities analysts expect that Aon plc will post 19.05 earnings per share for the current year.

AON Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Friday, August 14th. Shareholders of record on Monday, August 3rd were given a dividend of $0.82 per share. This represents a $3.28 annualized dividend and a yield of 1.0%. The ex-dividend date of this dividend was Monday, August 3rd. AON’s dividend payout ratio (DPR) is currently 18.08%.

Insider Activity

In other news, General Counsel Darren Zeidel sold 1,950 shares of the company’s stock in a transaction dated Friday, July 17th. The stock was sold at an average price of $372.05, for a total value of $725,497.50. Following the sale, the general counsel owned 13,404 shares in the company, valued at $4,986,958.20. This represents a 12.70% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through the SEC website. Over the last ninety days, insiders sold 4,450 shares of company stock valued at $1,659,242. Insiders own 1.00% of the company’s stock.

Institutional Investors Weigh In On AON

Several hedge funds have recently bought and sold shares of AON. Aviva PLC increased its stake in shares of AON by 2.0% in the 4th quarter. Aviva PLC now owns 333,454 shares of the financial services provider’s stock valued at $117,669,000 after purchasing an additional 6,622 shares in the last quarter. Handelsbanken Fonder AB boosted its position in AON by 9.1% during the fourth quarter. Handelsbanken Fonder AB now owns 67,034 shares of the financial services provider’s stock worth $23,655,000 after purchasing an additional 5,585 shares in the last quarter. Northwestern Mutual Wealth Management Co. boosted its position in AON by 1,864.5% during the fourth quarter. Northwestern Mutual Wealth Management Co. now owns 343,754 shares of the financial services provider’s stock worth $121,304,000 after purchasing an additional 326,256 shares in the last quarter. The Manufacturers Life Insurance Company grew its holdings in AON by 136.1% in the first quarter. The Manufacturers Life Insurance Company now owns 547,850 shares of the financial services provider’s stock valued at $176,835,000 after purchasing an additional 315,817 shares during the period. Finally, Highland Capital Management LLC purchased a new stake in shares of AON in the fourth quarter valued at approximately $1,359,000. Hedge funds and other institutional investors own 86.14% of the company’s stock.

About AON

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.