Willis Towers Watson (NASDAQ:WLTW), headquartered in the U.K. and the third-largest insurance broker in the world, was the top contributor for the quarter. The company delivered strong third-quarter earnings results and its organic growth reached 5%. Management now believes full-year organic growth will be closer to 4% after originally projecting a range of 3-4%. In addition, Willis lowered is fiscal-year tax rate guidance and increased earnings per share estimates for the full-year period. In our view, the company is also compelling because of its presence in the insurance brokerage industry, which is an attractive market because it does not bear underwriting risk, requires little capital and generates significant free cash flow. As a result, we continue to believe that Willis is significantly undervalued relative to its normalized earnings power.
From Bill Nygren (Trades, Portfolio) and David Herro (Trades, Portfolio)'s Oakmark Global Select Fund fourth quarter 2018 shareholder commentary.
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