Deutsche Bank Upgrades Willis Group Holdings

Deutsche Bank upgraded Willis Group Holdings PLC WSH from Sell to Hold Wednesday and set a $40 price target.

Analyst Joshua Shanker believed “Willis may be poised to break its multi-quarter streak of margin compression by posting margin expansion in excess of 100bps in 4Q14.

“Given the timeframe under which both the company and the stock have underperformed expectations, we believe that a change in earnings trend to the positive has the potential to trigger new investors to the name, even if we are cautious with regards to the sustainability of that trend.”

Shanker forecasted 4Q 2014 EPS at $0.48, above the consensus of $0.46. He expected EBIT margins to expand from 15.8 percent in 4Q 2013 to 17.1 percent in 4Q 2014.

The analyst report concluded that “the greatest upside risk is the potential for earnings to materially improve in 2016 or 2017 due to the restructuring plan.”

Willis Group Holdings PLC recently traded at $41.39, up 1.45 percent.