Marsh & McLennan Companies, Inc. (MMC) Intrinsic Value & DCF Valuation
Insurance - Brokers · NYSE
Current Price
$182.70
Intrinsic Value
$188.37
+3.0% margin of safety
What Is Marsh & McLennan Companies, Inc.'s Intrinsic Value?
As of 2026-01-13, the base-case DCF model estimates the intrinsic value of Marsh & McLennan Companies, Inc. (MMC) at $188.37 per share, compared with a market price of $182.7, a margin of safety of +3.0%. The base case assumes 5.0% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $151.74 to $230.57. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is Marsh & McLennan Companies, Inc. (MMC) Undervalued?
At $182.7, MMC trades about 3.0% below the base-case intrinsic value estimate. That is a real discount, but it stays short of the 30% margin of safety required before calling a stock undervalued.
COMPETITIVE MOAT
↑Global Brokerage Network Scale
MMC's extensive global network of brokers and consultants provides unparalleled market access and client reach. This scale creates significant barriers to entry for smaller competitors.
↑Data Analytics and Insights
The company leverages vast amounts of data to offer sophisticated risk management and advisory services. This proprietary data advantage enhances client value and retention.
↑Brand Reputation and Trust
MMC's long-standing reputation for expertise and reliability fosters deep client trust. This intangible asset is difficult for rivals to replicate, ensuring client loyalty.
INVESTMENT RISKS
↓Economic Downturn Impact
Recessions can lead to reduced corporate spending on risk management and consulting services. This could negatively affect MMC's revenue and growth prospects.
↓Talent Acquisition and Retention
Attracting and retaining top talent in specialized advisory fields is crucial. Intense competition for skilled professionals poses a risk to service quality.
↓Merger and Acquisition Integration
Successful integration of acquired businesses is vital for realizing synergies. Failure to effectively merge operations can lead to inefficiencies and value destruction.
Base case
MMC base case valuation
Intrinsic Value
$188.37
Margin of safety
+3.0%
Expected annual return
+0.6%
Base case assumptions: 5.0% annual growth, 10.0% discount rate, 19x exit multiple, 5 year projection. Data as of 2026-01-13.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the MMC valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Marsh & McLennan Companies, Inc. respond.
Open DCF Calculator for MMCCompany Overview
Marsh & McLennan Companies (MMC) operates as a leading global professional services organization, delivering expert guidance and innovative solutions to clients worldwide across the critical domains of risk, strategic planning, and human capital. Its operations are bifurcated into two primary divisions: Risk and Insurance Services, and Consulting. The Risk and Insurance Services arm provides an extensive range of risk management capabilities, encompassing strategic risk advice, risk transfer mechanisms, and solutions for risk control and mitigation. This segment is also proficient in insurance and reinsurance brokerage, offers sophisticated catastrophe and financial modeling, delivers associated advisory services, and manages insurance programs. Its diverse clientele includes businesses, governmental bodies, insurance companies, associations, specialized professional service organizations, and private individuals. Conversely, the Consulting division specializes in advisory services and products related to health, wealth, and career development. It also extends its expertise to specialized management, economic analysis, and brand strategy consulting. Founded in 1871, Marsh & McLennan Companies, Inc. maintains its corporate headquarters in New York, New York.
Financial Metrics — MMC Stock Valuation Data
Revenue/Share (TTM)
$57.98
FCF/Share (TTM)
$9.89
ROIC (TTM)
11.3%
ROE (TTM)
26.2%
P/FCF
18.8x
EV/EBITDA
15.5x
FCF Yield
5.31%
Debt/Equity
1.45x
On a trailing twelve-month basis, MMC generates free cash flow per share of $9.89 alongside a ROIC of 11.3%, both central inputs for a DCF valuation. Its P/FCF ratio of 18.8x and FCF yield of 5.31% then frame how MMC is priced against peers on a cash flow basis.
Frequently Asked Questions
What is the intrinsic value of MMC?
Marsh & McLennan Companies, Inc. currently generates $9.89 in free cash flow per share. At the current price of $182.70, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is MMC undervalued?
MMC trades at a P/FCF ratio of 18.8x with a free cash flow yield of 5.31%. This P/FCF is in a moderate range. However, whether MMC is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value MMC stock using DCF?
To perform a DCF valuation on Marsh & McLennan Companies, Inc.: (1) Start with the trailing free cash flow per share ($9.89) as the base, (2) project future FCF growth over 5-10 years based on Insurance - Brokers industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting MMC's risk profile — with a debt-to-equity of 1.45x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to MMC?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Marsh & McLennan Companies, Inc., this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Insurance - Brokers trends, then discounting those amounts to today's dollars. MMC's ROIC of 11.3% shows moderate capital returns.
How does WACC affect MMC stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For MMC, with a debt-to-equity ratio of 1.45x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 15.5x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See MMC PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Financial Services valuationsDCF and P/E value MMC with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-01-13. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.