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JimVanMeerten (62.41)

AON's intergration begins to pay off

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February 10, 2011 – Comments (0) | RELATED TICKERS: AON

Today I added AON Corp (AON) to the Barchart Van Meerten New High portfolio for very positive price trends.


Aon Corporation is a holding company whose operating subsidiaries carry on business in three distinct segments: insurance brokerage and other services; consulting; and insurance underwriting. The Insurance Brokerage and Other Services segment consists of its retail and reinsurance brokerage operations. The Consulting segment provides consulting services including employee benefits, human resources, and change management. Its Insurance Underwriting segment sells life and accident and health insurance, extended warranty, specialty and other insurance products.

Recent Press Release : "The integration of Aon Hewitt is well underway and client reaction has been exceptional," said Greg Case, president and CEO. "Cost savings related to our restructuring programs and operational initiatives are expected to drive significant margin improvement, and our strong cash flow generation provides financial flexibility as demonstrated by the repurchase of $150 million of Aon stock in the quarter."

Technical Analysis:  Recently the stock has been on a tear with 16 new highs and a price appreciation of 13.06% in the last month.  That price trend and a risings Relative Strength Index of 81.31% has earned the stock a 100% Barchart technical buy signal.  The stock trades around 49.62 which is well above its 50 day moving average of 45.10.

Fundamental Analysis:  Wall Street brokerages have published 9 buy and 7 hold recommendations for their clients based on projections for increased revenues and earnings.  Revenues are expected to increase by 10.00% this year and 25.70% next year. Earnings are estimated to increase by 12.10% this year and continue by an increase of 6.00% annually for the next 5 years.

Investor Sentiment:  Over on Motley Fool the CAPS members vote 113 to 19 that the stock will beat the market with the All Stars in agreement by a vote of 44 to 3.

Fool notes that the last 9 articles by Wall Street journalist have all been positive.

In my view the stock has all 3 burners flaming: 1- Recent and consistent positive price appreciation, 2 - Wall Street brokerage analysts endorsement based on a consensus of increases in revenue and earnings, and 3- A wide and positive general investor following.

Put this on on your watch lists.


Jim Van Meerten is a professional investor with over 40 year experience in investing in stocks, mutual funds and ETFs.  He shares his knowledge on Barchart in his daily blogs -- Barchart Portfolio Blogs.
Through Marketocracy Capital Management you can have a Separately Managed Account that mirrors his Barchart Van Meerten New High portfolio.

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