Top 10 Stocks to Buy According to Eagle Capital Management

5. Aon plc (NYSE:AON)

Number of Hedge Fund Holders as of Q4: 59

Eagle Capital Management’s Equity Stake: $1.43 Billion 

Aon plc (NYSE:AON), a British-American professional services firm specializing in risk mitigation, delivered strong financial performance in 2024, reflecting consistent execution of its strategic initiatives. The company achieved a 6% organic revenue growth for both the fourth quarter and the full year, with steady expansion across all solution lines. Aon’s profitability saw a significant boost in the fourth quarter, with net income attributable to shareholders rising 44% year over year. Diluted earnings per share climbed to $3.28, up from $2.47 in the prior-year period, while adjusted net income per share increased 14% to $4.42. These results underscore the company’s ability to enhance shareholder value through strong operational efficiency and disciplined cost management, further solidifying its market leadership.

In the fourth quarter, Aon plc (NYSE:AON) transitioned from a single reporting segment to two distinct units: Risk Capital and Human Capital, aligning its structure with client needs to enhance its Aon United strategy. Risk Capital, which includes Commercial Risk and Reinsurance Solutions, generated $2.5 billion in revenue, a 13% increase, while Human Capital, encompassing Health and Wealth Solutions, saw a 41% surge to $1.6 billion. Overall, total revenue rose 23% year-over-year to $4.1 billion, driven by 6% organic growth and contributions from the NFP acquisition, partially offset by a 1% negative foreign currency impact. Operating expenses climbed 18% to $3.1 billion due to ongoing costs from NFP, increased intangible asset amortization, and investments in long-term expansion, though restructuring savings of $40 million helped mitigate some expenses.

In the fourth quarter of 2024, Eagle Capital Management held over 3.98 million shares in Aon plc (NYSE:AON), which were valued at $1.43 billion and represented 5.21% of the fund’s portfolio.

Diamond Hill Large Cap Strategy stated the following regarding Aon plc (NYSE:AON) in its Q3 2024 investor letter:

“We continue finding compelling new ideas, even as the bull market proceeds. In Q3, we initiated three new positions in Aon plc (NYSE:AON), Accenture and Builders FirstSource. Aon, one of the world’s leading insurance brokers and consultants, has an excellent track record of growing free cash flow per share. Looking forward, as it fully integrates its acquisition of NFP, which had been a leading middle market broker and consultant, we believe Aon has an attractive opportunity to accelerate its growth rate. With shares trading at an attractive discount to our estimate of intrinsic value, we capitalized on the opportunity to initiate a position in this high-quality company.”