Cyber Budgets to Get Hot: Can Marsh & McLennan Take the Advisory Lead?

Core Insights - Marsh & McLennan Companies, Inc.'s (MMC) arm, Marsh, released a global cybersecurity report indicating that 75% of organizations are "highly confident" in their cyber-risk management strategies, with significant regional variations [1][9] - The report highlights that 66% of respondents plan to increase cybersecurity investments in the next year, with 26% expecting budget increases of 25% or more [2][9] - The findings suggest a shift in perception, positioning cybersecurity as a core business priority rather than just an IT issue, driven by the prevalence of third-party incidents and ransomware concerns [3][9] Investment Priorities - The top investment priorities identified in the report include cybersecurity technologies and mitigation tools, incident-response planning, and hiring security talent [2] - The report indicates that 70% of organizations experienced at least one major third-party cybersecurity incident in the past year, underscoring the need for enhanced security measures [2] Strategic Positioning - For MMC, the report positions the company as a trusted advisor in the growing global demand for cybersecurity risk management, potentially leading to increased service demand and higher premiums [4] - As organizations allocate higher budgets to cyber-defense, MMC could see revenue growth in its risk advisory and insurance brokerage lines [4] Financial Estimates - The Zacks Consensus Estimate for MMC's revenues indicates a 10% increase for 2025 and a 4.7% increase for 2026, with EPS estimates of $9.61 for 2025 (9.2% growth) and a further 6.9% increase for 2026 [5] - MMC has consistently beaten earnings estimates in the past four quarters, with an average surprise of 3.5% [5]