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Also traded in: Germany

GuruFocus Financial Strength Rank measures how strong a company’s financial situation is. It is based on these factors

1. The debt burden that the company has as measured by its Interest coverage (current year).
2. Debt to revenue ratio. The lower, the better
3. Altman Z-score.

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

Financial Strength

GuruFocus Profitability Rank ranks how profitable a company is and how likely the company’s business will stay that way. It is based on these factors:

1. Operating Margin
2. Trend of the Operating Margin (5-year average). The company with an uptrend profit margin has a higher rank.
••3. Consistency of the profitability
4. Piotroski F-Score
5. Predictability Rank•

The maximum rank is 10. A rank of 7 or higher means a higher profitability and may stay that way. A rank of 3 or lower indicates that the company has had trouble to make a profit.

Profitability Rank is not directly related to the Financial Strength Rank. But if a company is consistently profitable, its financial strength will be stronger.

Profitability & Growth

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» TW's 30-Y Financials


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Operating Cash Flow & Free Cash Flow
Operating Cash Flow & Net Income

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Business Description

Industry: Business Services » Business Services  
Traded in other countries:TW6.Germany,
Headquarter Location:USA

Towers Watson & Co was formed on January 1, 2010. The Company is a professional services company that helps organizations improves performance through effective people, risk and financial management. It offers solutions in the areas of employee benefits, talent management, rewards, risk and capital management and healthcare exchanges for both retirees and active employees. The Company offers its clients with services through four business segments; Benefits; Risk and Financial Services; Talent and Rewards; and Exchange Solutions. The Benefits segment provides benefits consulting and administration services through four lines of business; Retirement; Health and Group Benefits; Technology and Administration Solutions; and International Consulting. Retirement supports organizations in designing, managing, administering and communicating retirement plans. Health and Group Benefits provides advice on the design, financing, delivery, ongoing plan management and communication of health and group benefit programs. Technology and Administration Solutions line deliver cost-effective benefit outsourcing solutions. The International Consulting Group provides expertise in dealing with international human capital management and related benefits and compensation advice. The Risk and Financial Services segment has two lines of business; Risk Consulting and Software; and Investment. The Risk Consulting and Software provides risk consulting and financial modeling software solutions to the insurance industry. Investment provides consulting and solutions focused on investment, risk assessment, asset allocation, manager selection and investment execution to institutional investors including pension plans. The Talent and Rewards segment has three lines of business Executive Compensation; Rewards, Talent and Communication; and Data, Surveys and Technology. The Rewards, Talent and Communication provides services including designing and implementing pay and other human resource programs and processes that influence employees' behavior, engagement and performance. The Data, Surveys and Technology enhances workforce management programs through reward administration and talent management technology, compensation benchmarking, employee opinion surveys, and human resource (HR) function metrics. The Exchange Solutions segment includes two lines of business; Retiree & Access Exchanges; and Liazon. Its OneExchange Retiree solution operates private Medicare insurance exchange in the U.S. Its retiree solution enables employers to transition their retirees to individual, defined contribution health plans at an annual cost that the employer controls - versus group-based, defined benefit health plans. Its Clients includes approximately 92% of the Fortune500 companies and 84% of the Fortune 1000. It also provides advice to insurance companies. Its competitors include; Mercer HR Consulting; Aon Hewitt Consulting; Deloitte, Accenture, EY, SuccessFactors, Pricewaterhouse

Guru Investment Theses on Towers Watson & Co

Baron Funds Comments on Towers Watson & Co. - Jan 26, 2016

Shares of Towers Watson & Co. (NASDAQ:TW), a global benefits consultancy, gained on developments related to its now-completed merger with Willis Group Holdings plc. In late November, Willis more than doubled the special dividend payable to Towers Watson shareholders to $10/share, as part of the merger consideration. This proved sufficient to achieve shareholder approval for a “merger of equals” between these two public companies, leading to the formation of Willis Towers Watson plc. We believe the merger could result in meaningful cost synergies, accelerate revenue growth, increase free cash flow generation, reduce the corporate tax rate, and drive modest multiple expansion.

From Baron Funds' Baron Asset Fund commentary for fourth quarter 2015.

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Baron Funds Comments on Towers Watson & Co. - Aug 19, 2015

Towers Watson & Co. (NASDAQ:TW) is a leading global professional services company that helps organizations improve performance through effective people, risk and financial management. We believe the company is poised to leverage its breadth of relationships in benefits and health care consulting to become a leading player in private health care exchanges in the U.S. Our research suggests that private health care exchanges are poised for explosive growth, and are projected to represent a $12 billion annual market by 2018-19.

From Baron Funds’ second quarter 2015 commentary.

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Dividend & Buy Back

Dividend Yield % 0.49
TW's Dividend Yield % is ranked lower than
94% of the 674 Companies
in the Global Business Services industry.

( Industry Median: 1.53 vs. TW: 0.49 )
Ranked among companies with meaningful Dividend Yield % only.
TW' s Dividend Yield % Range Over the Past 10 Years
Min: 0  Med: 0 Max: 0.49
Current: 0.49
Dividend Payout Ratio 0.10
TW's Dividend Payout Ratio is ranked higher than
96% of the 407 Companies
in the Global Business Services industry.

( Industry Median: 0.43 vs. TW: 0.10 )
Ranked among companies with meaningful Dividend Payout Ratio only.
TW' s Dividend Payout Ratio Range Over the Past 10 Years
Min: 0  Med: 0 Max: 0.1
Current: 0.1
Forward Dividend Yield % 0.49
TW's Forward Dividend Yield % is ranked lower than
96% of the 621 Companies
in the Global Business Services industry.

( Industry Median: 2.58 vs. TW: 0.49 )
Ranked among companies with meaningful Forward Dividend Yield % only.
5-Year Yield-on-Cost % 0.49
TW's 5-Year Yield-on-Cost % is ranked lower than
93% of the 812 Companies
in the Global Business Services industry.

( Industry Median: 2.82 vs. TW: 0.49 )
Ranked among companies with meaningful 5-Year Yield-on-Cost % only.
TW' s 5-Year Yield-on-Cost % Range Over the Past 10 Years
Min: 0  Med: 0 Max: 0.49
Current: 0.49

Valuation & Return


More Statistics

Revenue (TTM) (Mil) $3,662.47
EPS (TTM) $ 6.12
Short Percentage of Float1.65%
52-Week Range $110.16 - 141.88
Shares Outstanding (Mil)69.44

Analyst Estimate

Jun16 Jun17
Revenue (Mil $) 5,848 6,310
EPS ($) 6.84 9.22
EPS without NRI ($) 6.84 9.22
EPS Growth Rate
(Future 3Y To 5Y Estimate)
Dividends per Share ($) 0.48 0.61
» More Articles for TW


Articles On GuruFocus.com
Many of Ron Baron's 1st-Quarter Divestitures Are Overvalued Today May 30 2016 
Ron Baron Exits Towers Watson May 23 2016 
Jeff Ubben Exits Position in American Express Mar 10 2016 
Jeff Ubben Doubles Stake in Towers Watson & Co. Mar 02 2016 
Which Industries Are Super Investors Dumping and Where Are They Shopping? Feb 03 2016 
Baron Funds Comments on Towers Watson & Co. Jan 26 2016 
Baron Funds' Baron Asset Fund 4th Quarter Shareholder Letter Jan 26 2016 
Jeff Ubben Trims Stake in Adobe Systems, Halliburton Dec 20 2015 
Top 5 Dividend Stocks Among Guru Holdings Nov 24 2015 
Why ValueAct Capital Is Buying Towers Watson Nov 19 2015 

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