Willis Towers Watson(US:WTW) ZACKSยท2025-09-04 17:31Core Insights - Willis Towers Watson's (WTW) Risk & Broking segment is pivotal for the firm's growth strategy, serving as a direct link between clients and insurers, thereby shaping recurring and diversified revenue streams [1][2] Group 1: Performance and Growth - The Risk & Broking segment drives growth momentum by leveraging expertise and analytics to create measurable business impact, with strong client retention and new business wins contributing to consistent revenue growth [2] - In Q2 2025, the Risk & Broking segment achieved 6% organic growth, with revenues reaching $1.1 billion and operating income increasing by 10% to $2.2 billion, resulting in a margin improvement to 21.2% year over year [3][4] - Operational scale, innovation, and transformation initiatives are translating into sustainable profitability, reinforcing the segment's role as a long-term growth engine for WTW [4] Group 2: Competitive Landscape - Brown & Brown, Inc.'s Wholesale Brokerage segment has seen growth through higher commissions, fees, and organic expansion, indicating a competitive environment [5] - Arthur J. Gallagher & Co. generates a significant portion of its revenue from its Brokerage segment, benefiting from strong client retention and growing customer activity, which supports organic growth [6] Group 3: Valuation and Estimates - WTW shares have gained 4.4% year-to-date, contrasting with a 14.1% decline in the industry, indicating relative strength [7] - The shares trade at a price to forward 12-month earnings of 17.83, below the industry average of 20.62, suggesting potential undervaluation [9] - The Zacks Consensus Estimate for WTW's 2025 earnings indicates a 0.7% decline year over year, followed by a projected 13.5% increase in the subsequent year [11]