Core Viewpoint - Truist Financial has set a price target of $400 for Willis Towers Watson PLC, indicating a potential increase of approximately 18.04% from its current stock price of around $338.86 [1][5] Financial Performance - WTW reported a 6% organic revenue growth in Q4 2025, driven by a strategic focus on Risk and Broking, along with investments in talent and innovation [2][5] - The adjusted operating margin increased by 80 basis points to 36.9%, reflecting improved efficiency and profitability [2][5] - The company's adjusted earnings per share rose by 13% year-over-year to $8.12, excluding contributions from TRANZACT, supported by recent acquisitions [3][5] Stock Performance - WTW's stock is currently priced at $337.35, showing a slight increase of 0.67% or $2.25, with fluctuations between $337.05 and $344.99 on the day [4] - Over the past year, the stock reached a high of $352.79 and a low of $292.97, with a market capitalization of approximately $32.91 billion [4]

Core Insights - Willis Towers Watson (WTW) reported fourth-quarter 2025 adjusted earnings of $8.12 per share, exceeding the Zacks Consensus Estimate by 2.5%, with a year-over-year increase of 2% [1] - The quarterly results were supported by expanded operating margins in the Health, Wealth & Career and Risk & Broking segments, along with reduced expenses [1] Operational Update - WTW's adjusted consolidated revenues were $2.9 billion, reflecting a 3% decline year over year on a reported basis, but a 6% increase on an organic basis; the top line also beat the Zacks Consensus Estimate by 2.5% [2] - Total service costs decreased by 10% year over year to $1.9 billion, attributed to lower operating expenses, amortization, and transaction costs [2] Financial Performance - Adjusted operating income was $1 billion, down 1% year over year, with a margin expansion of 80 basis points to 36.9% [3] - Adjusted EBITDA was $1.12 billion, a 3% decrease year over year, with an adjusted EBITDA margin of 38.2%, which expanded by 30 basis points [3] Segment Performance - Health, Wealth & Career segment revenues totaled $1.6 billion, down 11% year over year, but beat estimates by 0.6%; organic growth was driven by strong client retention and healthcare inflation [4] - Wealth segment saw organic revenue growth from robust Retirement work and new product offerings, while Career segment growth was fueled by demand for advisory services and compensation benchmarking [5] - Risk & Broking segment revenues rose 10% year over year to $1.2 billion, exceeding estimates by 4.9%, driven by new business activity and strong client retention [6][8] Financial Update - As of December 31, 2025, cash and cash equivalents were $3.1 billion, a 65.7% increase from the end of 2024; long-term debt rose 8.4% to $5.7 billion [10] - Free cash flow for 2025 increased by 22% year over year to $1.55 billion, primarily due to operating margin expansion [11] Future Outlook - WTW anticipates a 10 cents dilution to adjusted EPS in 2026 from the Newfront acquisition, with projected post-close revenues of $250 million and an adjusted EBITDA margin of 26% [12] - The company expects continued annual margin expansion at the enterprise level, with a foreign currency tailwind on adjusted diluted EPS of 30 cents in 2026 [13] - Share repurchases of $1.0 billion or more are planned, subject to market conditions [14] Full-Year Highlights - For the full year, adjusted earnings were $17.08 per share, beating estimates by 1.2%, with total revenues declining 2% year over year to approximately $9.7 billion, also exceeding estimates by 0.6% [15]

Core Insights - The company achieved adjusted diluted earnings per share (EPS) of $17.08 for the full year, reflecting a 13% increase year over year when excluding the contribution from TRANZACT [1][20] - For 2025, the company reported organic growth of 5% and expanded adjusted operating margin by 130 basis points to 25.2% [1][19] - The fourth quarter saw a 6% organic growth in health, wealth, and career segments, with a notable 10% growth in career services [2][23] Financial Performance - Adjusted EPS for the fourth quarter was $8.12, marking a 13% increase year over year when excluding TRANZACT [2][19] - The company generated free cash flow of $1.5 billion for the year, an increase of $279 million from the previous year, resulting in a free cash flow margin of 15.9% [34] - The adjusted operating margin for the fourth quarter was 36.9%, an 80 basis point improvement year over year [32] Segment Performance - Health, wealth, and career revenue grew 6% in the fourth quarter, with health business achieving 4% growth [20][21] - The corporate risk and broking (CRB) segment recorded 8% organic growth in the fourth quarter, continuing a trend of high single-digit growth [5][27] - The wealth segment saw strong growth driven by increased retirement work globally, with expectations for high single-digit growth in 2026 [22][66] Strategic Initiatives - The company is focused on enhancing efficiency through its enterprise delivery organization and investments in technology, which are expected to drive further margin expansion [2][11] - Recent acquisitions, including Newfront, Cushion, and Flowstone Partners, are aimed at optimizing the company's portfolio for growth and profitability [2][13] - The company plans to allocate at least $1 billion to share repurchases in 2026, reflecting a balanced capital allocation approach [36][71] Market Outlook - The company anticipates continued strong demand across its global business, driven by healthcare inflation and employers' focus on managing costs while maintaining competitive employee benefits [21][62] - For 2026, the company expects mid-single-digit organic growth across its segments, supported by ongoing investments in talent and technology [17][50] - The company is optimistic about its position in the market and the potential for synergies from recent acquisitions over the next three years [15][17]

Core Insights - Willis Towers Watson (WTW) reported a revenue of $2.94 billion for the quarter ended December 2025, reflecting a decrease of 3.3% year-over-year, while EPS was $8.12, slightly down from $8.13 in the previous year [1] - The revenue exceeded the Zacks Consensus Estimate of $2.86 billion by 2.51%, and the EPS also surpassed the consensus estimate of $7.92 by 2.47% [1] Revenue Breakdown - Health, Wealth and Career segment revenue was $1.65 billion, slightly above the average estimate of $1.64 billion, but down 11.1% year-over-year [4] - Reimbursable expenses and other revenue reached $31 million, exceeding the estimated $26.16 million, but showed a significant decline of 24.4% compared to the previous year [4] - Total segment revenue was reported at $2.9 billion, surpassing the average estimate of $2.84 billion, with a year-over-year decline of 4.4% [4] - Risk and Broking segment revenue was $1.25 billion, exceeding the average estimate of $1.19 billion, and showed a year-over-year increase of 9.8% [4] Operating Income - Segment Operating Income for Risk and Broking was $435 million, higher than the estimated $408.38 million [4] - Segment Operating Income for Health, Wealth and Career was reported at $729 million, slightly above the average estimate of $719.31 million [4] Stock Performance - Over the past month, shares of Willis Towers Watson have returned -5.4%, contrasting with the Zacks S&P 500 composite's +1.8% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - In Q4 2025, the company achieved 6% organic growth, with adjusted operating margin expanding by 80 basis points to 36.9% [7][19] - Adjusted EPS for Q4 was $8.12, reflecting a 13% increase year-over-year when excluding TRANZACT [7][19] - For the full year, organic growth was 5%, with adjusted operating margin expanding by 130 basis points to 25.2% and adjusted diluted EPS of $17.08, up 13% year-over-year excluding TRANZACT [7][19] Business Line Data and Key Metrics Changes - Health, Wealth and Career (HWC) segment saw organic growth accelerate to 6% in Q4, with a full-year growth of 4% [7][20] - Risk and Broking (R&B) generated 7% organic growth in Q4, with corporate Risk and Broking achieving 8% growth, marking the 12th consecutive quarter of high single-digit growth [8][25] - Career segment experienced 10% growth in Q4, driven by demand for advisory services and compensation benchmarking [22][66] Market Data and Key Metrics Changes - The health business reported strong growth driven by new business acquisition and healthcare inflation, with expectations for high single-digit growth in 2026 [21][64] - The wealth business grew 5% in Q4, supported by increased retirement work and new solutions in Europe [22][70] - The BD&O segment grew 5% in Q4, but is projected to achieve low single-digit growth in 2026 due to changes in the Medicare market [23][59] Company Strategy and Development Direction - The company is focused on optimizing its portfolio for growth and profitability, with recent acquisitions including Newfront, Cushon, and FlowStone Partners [5][16] - Strategic investments in talent and technology are expected to drive sustainable growth and margin expansion [12][32] - The company aims to maintain a disciplined approach to capital allocation, with at least $1 billion allocated to share repurchases in 2026 [31][74] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position and outlook for 2026, supported by strong market momentum and ongoing strategic execution [17][32] - The political and regulatory environment is seen as a driver for clients seeking advice and solutions [17] - While monitoring potential headwinds, management remains optimistic about achieving mid-single-digit organic growth and margin expansion [17][50] Other Important Information - The company generated free cash flow of $1.5 billion for the year, an increase of $279 million from the prior year, with a free cash flow margin of 15.9% [30] - The adjusted tax rate for Q4 was 20.8%, consistent with the prior year, and is expected to remain stable in 2026 [29][30] Q&A Session Summary Question: Drivers of organic growth within R&B - Management highlighted strong organic growth in R&B, with significant contributions from various specialty lines and a focus on specialization strategy [36][38] Question: Mid- to high single-digit guidance for R&B in 2026 - Management acknowledged potential pricing improvements but emphasized that growth is driven by high retention rates and new business [40][43] Question: Impact of talent on organic growth in 2026 - Management confirmed that strategic talent investments have been key to driving organic growth and will continue to be a focus [52][53] Question: Changes in Medicare influencing BD&O growth - Management expects modest headwinds from Medicare changes but anticipates strong demand in the retiree marketplace [58][59] Question: AI's impact on consulting services - Management views AI as an opportunity rather than a threat, focusing on regulatory-driven recurring services [72]

Financial Data and Key Metrics Changes - In Q4 2025, the company achieved 6% organic growth, with adjusted operating margin expanding by 80 basis points to 36.9% [7][19] - Adjusted EPS for Q4 was $8.12, a 13% increase year-over-year when excluding TRANZACT [7][19] - For the full year, organic growth was 5%, with adjusted operating margin expanding by 130 basis points to 25.2% and adjusted diluted EPS of $17.08, also up 13% year-over-year excluding TRANZACT [7][19] Business Line Data and Key Metrics Changes - Health, Wealth and Career (HWC) segment saw organic growth accelerate to 6% in Q4, with a full-year growth of 4% [7][20] - Risk and Broking (R&B) generated 7% organic growth in Q4, with corporate Risk and Broking achieving 8% growth, marking the 12th consecutive quarter of high single-digit growth [8][25] - The insurance consulting and technology business experienced a 1% decline in Q4, contrasting with 11% growth in the prior year [26] Market Data and Key Metrics Changes - The international market drove growth in the health business, with strong performance in Europe and new business acquisitions [21][22] - The corporate Risk and Broking business saw significant contributions from construction, surety, marine, and credit risk solutions [25] - The company expects high single-digit growth in the health segment for 2026, driven by healthcare inflation and demand for competitive employee benefits [21][64] Company Strategy and Development Direction - The company is focused on optimizing its portfolio for growth and profitability, with recent acquisitions including Newfront, Cushon, and FlowStone Partners [5][16] - A specialization strategy in Risk and Broking is driving new business momentum and enhancing efficiency [4][8] - The company plans to integrate Newfront's technology and team into its operations to enhance client service and drive growth [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position and outlook for 2026, expecting mid-single-digit organic growth and continued margin expansion [17][30] - The political and regulatory environment is seen as a driver for clients seeking advice and solutions [17] - While monitoring potential headwinds, management remains optimistic about the company's competitive advantages and market momentum [17] Other Important Information - The company generated free cash flow of $1.5 billion for the year, with a free cash flow margin of 15.9% [30] - Share repurchases totaled $439 million in Q4, with plans to allocate at least $1 billion to share repurchases in 2026 [31][32] - The company expects foreign exchange to be a tailwind of approximately $0.30 to adjusted EPS for 2026 [29][50] Q&A Session Summary Question: Drivers of organic growth within R&B - Management highlighted strong organic growth in R&B, with significant contributions from various specialty lines and a focus on specialization strategy [36][38] Question: Mid- to high-single-digit guidance for R&B in 2026 - Management acknowledged potential pricing improvements but emphasized that growth is driven by high retention rates and new business [40][43] Question: Impact of talent on organic growth in 2026 - Management confirmed that strategic talent investments have been key to driving organic growth and will continue to be a focus [52][53] Question: Changes in Medicare influencing BD&O growth - Management expects modest headwinds from Medicare changes but anticipates strong demand in the retiree marketplace [58][59] Question: AI's impact on consulting services - Management views AI as an opportunity rather than a threat, focusing on regulatory-driven recurring services [72]

Financial Data and Key Metrics Changes - In Q4 2025, the company achieved 6% organic growth, with an adjusted operating margin expansion of 80 basis points, and adjusted EPS of $8.12, reflecting a 13% increase year-over-year when excluding TRANZACT [5][18] - For the full year, organic growth was 5%, with adjusted operating margin expanding by 130 basis points to 25.2%, and adjusted diluted EPS of $17.08, also up 13% year-over-year excluding TRANZACT [5][18] Business Line Data and Key Metrics Changes - Health, Wealth and Career (HWC) segment saw organic growth accelerate to 6% in Q4, with a full-year growth of 4% [5][19] - Risk and Broking (R&B) generated 7% organic growth in Q4, with corporate Risk and Broking achieving 8% growth, marking the 12th consecutive quarter of high single-digit growth [6][25] - The insurance consulting and technology business experienced a decline of 1% in Q4, with full-year growth at 1% compared to 4% the previous year [26] Market Data and Key Metrics Changes - The international market drove growth in the health segment, particularly in Europe, while North America faced challenges due to a book of business sale in the prior year [20] - The company expects strong demand across global markets, driven by healthcare inflation and employers' focus on managing costs while maintaining competitive employee benefits [20][66] Company Strategy and Development Direction - The company is focused on optimizing its portfolio through strategic acquisitions, including Newfront, Cushon, and FlowStone Partners, to enhance growth and profitability [4][15] - The specialization strategy in Risk and Broking continues to drive new business momentum, particularly in construction and surety [6][25] - Investments in talent and technology are central to the company's strategy, with a focus on enhancing efficiency and driving margin expansion [11][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position and outlook for 2026, anticipating mid-single-digit organic growth and continued margin expansion [16][30] - The political and regulatory environment remains dynamic, prompting clients to seek the company's advice and solutions [16] - While optimistic about current conditions, management is monitoring potential headwinds for the upcoming year [16] Other Important Information - The company generated free cash flow of $1.5 billion for the year, with a free cash flow margin of 15.9%, an increase from 12.8% the previous year [31] - Share repurchases are a primary method of capital return, with at least $1 billion expected to be allocated to buybacks in 2026 [32] Q&A Session Summary Question: Drivers of organic growth within R&B - Management highlighted strong organic growth of 7% in R&B, driven by specialization strategy and investments in talent, data, and technology [37][39] Question: Mid- to high single-digit guidance for R&B in 2026 - Management acknowledged that while pricing may improve, growth is supported by high retention rates and new business opportunities, particularly in digital infrastructure and electrification [40][42] Question: Impact of talent on organic growth in 2026 - The company plans to continue strategic hiring to support organic growth, emphasizing the importance of talent in driving sustainable and profitable growth [52][54] Question: Changes in Medicare influencing BD&O growth - Management expects modest headwinds from Medicare changes but anticipates strong demand for retiree marketplace services to support low single-digit growth in 2026 [60][61] Question: AI's impact on consulting services - Management views AI as an opportunity rather than a threat, focusing on regulatory-driven recurring services that are expected to remain in demand [74]

February 3, 2026 wtwco.com © 2026 WTW. All rights reserved. WTW Forward-Looking Statements This document contains 'forward-looking statements' within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934, which are intended to be covered by the safe harbors created by those laws. These forward-looking statements include information about possible or assumed future results of our operations. All statements, other than statements of historical facts, ...

分组1 - Willis Towers Watson (WTW) reported quarterly earnings of $8.12 per share, exceeding the Zacks Consensus Estimate of $7.92 per share, with a year-over-year comparison showing earnings of $8.13 per share [1] - The company achieved revenues of $2.94 billion for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 2.51%, although this represents a decline from year-ago revenues of $3.04 billion [2] - Over the last four quarters, WTW has surpassed consensus EPS estimates three times and has topped consensus revenue estimates three times as well [2] 分组2 - The stock has underperformed the market, losing about 3.7% since the beginning of the year, while the S&P 500 has gained 1.9% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the coming quarter is $3.61 on revenues of $2.34 billion, and for the current fiscal year, it is $19.24 on revenues of $10.21 billion [7] 分组3 - The Zacks Industry Rank indicates that the Insurance - Brokerage sector is currently in the bottom 13% of over 250 Zacks industries, suggesting potential challenges for stocks in this sector [8] - The estimate revisions trend for WTW was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6]

Revenue Performance - Revenue for Q4 2025 was $2.94 billion, a decrease of 3% year-over-year, with organic growth of 6%[6]. - Full year 2025 revenue was $9.71 billion, a decrease of 2% compared to $9.93 billion in 2024, with organic growth of 5%[12]. - Total revenue for the three months ended December 31, 2025, was $2,936 million, a decrease of 3% compared to $3,035 million in 2024[52]. - The Health, Wealth & Career segment reported Q4 revenue of $1.65 billion, down 11%, but achieved organic growth of 6%[15][16]. - The Risk & Broking segment saw Q4 revenue increase to $1.25 billion, a 10% rise, with organic growth of 7%[18]. - Health, Wealth & Career segment revenue excluding interest income was $1,641 million, down 11% from $1,847 million in the previous year[52]. - Risk & Broking segment revenue excluding interest income increased by 10% to $1,229 million from $1,115 million[52]. - The company’s total revenue for the year ended December 31, 2025, was $9,708 million, a decrease of 2% from $9,930 million in 2024[53]. Income and Earnings - Net Income for Q4 2025 was $736 million, down 41% from $1.25 billion in Q4 2024, with diluted EPS at $7.62, a 38% decline[7][8]. - Adjusted net income for the three months ended December 31, 2025, was $784 million, compared to $811 million in 2024[62]. - Net income for 2025 was $1.613 billion, a significant recovery from a net loss of $88 million in 2024[81]. - The company reported a net income attributable to WTW of $735 million for Q4 2025, down from $1,246 million in Q4 2024[62]. - Diluted earnings per share for Q4 2025 was $7.62, down from $12.25 in Q4 2024[62]. Cash Flow and Financial Metrics - Free cash flow for the year ended December 31, 2025, was $1.55 billion, an increase of $279 million from the previous year[14]. - Free Cash Flow for the year ended December 31, 2025, was $1,546 million, up from $1,267 million in 2024, resulting in a Free Cash Flow Margin of 15.9%[73]. - Free cash flow is defined as cash flows from operating activities minus cash used for fixed assets and software, reflecting the core operating performance[42]. - Free cash flow margin indicates the percentage of revenue realized on a cash basis, serving as a meaningful metric for cash conversion[43]. - Net cash from operating activities improved to $1.775 billion in 2025, up from $1.512 billion in 2024, a growth of 17.4%[81]. Operating Performance - Adjusted EBITDA for Q4 2025 was $1.12 billion, representing 38.2% of revenue, a decrease of 3% year-over-year[7]. - Adjusted EBITDA for Q4 2025 was $1,121 million with a margin of 38.2%, compared to $1,151 million and a margin of 37.9% in Q4 2024[66]. - Operating margin for Q4 2025 improved to 34.6%, up 490 basis points from the prior year[8]. - Segment operating income for the three months ended December 31, 2025, was $1,164 million, slightly up from $1,159 million in 2024[55]. - Health, Wealth & Career segment operating margin improved to 44.3% in Q4 2025 from 41.9% in Q4 2024[58]. - Adjusted operating income for the year ended December 31, 2025, was $2,449 million with a margin of 25.2%, compared to $2,378 million and a margin of 23.9% in 2024[68]. Assets and Liabilities - Total assets increased to $29.53 billion in 2025 from $27.68 billion in 2024, representing a growth of 6.2%[78]. - Total current liabilities increased to $14.004 billion in 2025 from $12.598 billion in 2024, reflecting a rise of 11.2%[78]. - Long-term debt increased to $5.756 billion in 2025, compared to $5.309 billion in 2024, an increase of 8.4%[78]. - Total equity increased slightly to $8.052 billion in 2025 from $8.017 billion in 2024, reflecting a growth of 0.4%[78]. Shareholder Returns and Future Plans - The company plans to repurchase $1.0 billion or more in shares in 2026, subject to market conditions[20]. - The company repurchased shares worth $1.650 billion in 2025, compared to $901 million in 2024, indicating a significant increase in share buybacks[82]. - Expected foreign currency tailwind on Adjusted Diluted EPS for 2026 is approximately $0.30[23]. Risks and Strategic Focus - Risks include macroeconomic trends, changes in interest rates, and geopolitical risks that could impact financial results[46]. - The company is actively pursuing growth strategies, including acquisitions and enhancing its service offerings[45]. - Forward-looking statements highlight the uncertainties and risks associated with achieving the company's objectives and plans[49]. - The company emphasizes the importance of constant currency measures to provide transparency in performance by excluding foreign currency fluctuations[33]. - Organic change excludes the impact of foreign currency fluctuations and acquisitions, providing a clearer view of core operating results[34]. - Adjusted operating income and margin are key financial measures used to evaluate core operations and benchmark against competitors[36]. - Adjusted EBITDA and margin are also critical metrics for assessing core operations and performance-based compensation plans[37].