Aon Maintains Its Momentum in Fourth Quarter

Aon had an excellent year and maintained its momentum through the fourth quarter. For the quarter and the full year, Aon achieved 10% and 9% year-over-year revenue growth, respectively, excluding currency impacts and acquisitions, and also solid margin improvement. However, the company has achieved only modest organic growth historically, and this is our expectation over the long term, although we think growth in 2022 could remain relatively strong compared with historical levels. We will maintain our $236 fair value estimate and narrow moat rating. While Aon is a fundamentally attractive franchise, we believe the market is overly focused on the company’s recent results and near-term prospects.