Broker Merrill Lynch has moved Willis Group from 'buy' to 'neutral' and placed Aon Corporation.....
Broker Merrill Lynch has moved Willis Group from 'buy' to 'neutral' and placed Aon Corporation on its 'sell' list, on account of Eliot Spitzer's expanding investigation into the property and casualty industry and last week's flood earnings reports.
Merrill Lynch analyst Jay Cohen said that Aon's ability to expand its share of the market would be dependent on whether Spitzer's ongoing investigation would bring forth allegations and lawsuits against the company.
Cohen has also reduced his 2005 earnings forecast for Aon from $1.85 per share to $1.70, following the group's third quarter results statement. He added that the current share price was high when set against what was a "challenging operating environment".
Of Willis, Cohen said that the company could be exposed to conflict-of-interest allegations by the New York attorney general. He also cautioned that any shift of market share from Marsh & McLennan Companies, as a result of its troubles, would probably be more gradual than the market had been factoring in of late.
