Low Signal Valuation in Towers Watson
Towers Watson, headquartered in New York, Towers Watson provides human capital and financial management consulting services worldwide. The US accounts for about 63% of revenue while Europe, the Middle East and Australia comprise 33%. In the core business, Benefits (59% of revenue), the company designs pension and benefit programs, provides actuarial services and other retirement solutions. Additionally, in the Risk and Financial Services group (23% of revenue), TW provides advice concerning risk management, reinsurance, and investment consulting. The Talent and Rewards Solutions group (16% of revenue) offers human capital solutions, executive comp analysis, data services and communication consulting.
Towers Watson is has a smooth and predictable earnings history. It is also at the low end of its valuation range.
Low PEG ratio of 0.91, attractive ROC of 43.6% and an earnings yield of 9.7%.
Market Capitalization of $USD 3.2 billion. Net cash of approximately $300 million and a dividend of 0.85%, a good history of raising dividends.
Purple Chips target is $USD 67.00 within 18 months. JP Morgan has a target of $USD 74.00 and Deutsche Bank has a $67 target.
Video analysis follows below
