Davenport Initiates Coverage on Willis Group Holdings Ltd. (WSH) with a Buy; Leader in Organic Growth Among Peers

April 8, 2009 11:24 AM EDT

Davenport initiates coverage on Willis Group Holdings Ltd. (NYSE: WSH) with a Buy. Price target $32.

Davenport analyst says, "We feel the market is overly concerned about the integration of the recent acquisition of Hilb, Rogal & Hobbs (NYSE: HRH) and the associated increase in financial leverage. While do not minimize these risks, we feel Willis’ recent record of operating improvement and its strong cash flow generation will become increasingly apparent. Our initial target price is $32, which is based on a six multiple of projected EBITDA per share ($5.37 in fiscal 2009.)...Over the past several years, Willis has taken market share from its larger competitors. In 2008, Willis again stood out from the industry on organic growth despite a very difficult pricing environment. We feel company management, a tightly focused business model and the international flavor of its business mix are all key ingredients in this success. The stock is attractively valued and has a substantial dividend yield."

Willis Group Holdings Limited is a global insurance broker. The Company is the ultimate holding company for the Willis Group.

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