Aon plc (AON) vs Mastercard Incorporated (MA): Which Is the Better Buy in 2026?
As of 2026-06-19, AON is undervalued at $318, with a DCF intrinsic value of $499 and a margin of safety of 36%. MA is fairly valued at $490, with an intrinsic value of $571 and a margin of safety of 14%. Of the two, AON has the wider margin of safety.
Rewards
- ★Aon plc has maintained ROIC above 10% for 4 consecutive years, suggesting solid business economics.
- ★Aon plc scores 90/100 on the Economic Moat Score (Wide Moat), with reinvestment efficiency as the strongest competitive dimension.
- ★Each dollar of retained earnings has created $2.67 of earning power — management is an exceptional capital allocator.
- ★Mastercard Incorporated has maintained ROIC above 15% for 4 consecutive years, indicating a durable competitive advantage.
- ★Gross margin of 100.0% indicates strong pricing power — typical of businesses with significant intellectual property or brand strength.
- ★Mastercard Incorporated scores 99/100 on the Economic Moat Score (Wide Moat), with roic consistency as the strongest competitive dimension.
Risks
- ⚠PEG ratio of 2.65 indicates the stock is expensive relative to its expected growth — the market may be pricing in more growth than analysts project.
- ⚠Altman Z-Score of 1.80 places the company in the distress zone — financial patterns resemble those of companies that experienced bankruptcy.
- ⚠High leverage (1.60x net debt/equity) combined with thin interest coverage (-1.0x) poses financial risk.
- ⚠12 insider sales with no purchases over the past 12 months — a persistent pattern of insider selling.
Key Valuation Metrics
Learn more →Historical Fundamentals
Learn more →Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
$1 Retained Earnings Test
Learn more →> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Discounted Cash Flow (DCF) Analysis
Learn more →Reverse DCF — Market-Implied Growth
Learn more →What growth rate is the market pricing in at $318?
The market implies +6.8% Owner Earnings growth, below historical trends — potential opportunity.
Standard FCF implies a more demanding +10.5%, reflecting heavy growth investment expected to generate future returns.
What growth rate is the market pricing in at $490?
The market implies +13.0% Owner Earnings growth, roughly in line with history — reasonably priced.
Standard FCF implies +12.0%, reflecting ongoing growth investment.
Economic Moat Score
Learn more →Wide moat with strength across all dimensions. Reinvestment Efficiency is the standout factor.
Wide moat with strength across all dimensions. ROIC Consistency is the standout factor.
Forensic Accounting
Learn more →M-Score Trend
M-Score Trend
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
Ownership Breakdown
Learn more →High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.
Insider Buying Activity
Learn more →Open market purchases · includes direct & indirect ownership · excludes option exercises.
Insider Selling Activity
Learn more →Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.
🎭 Mr. Market's Mood
Learn more →"Market is pricing this stock without strong emotion in either direction"
"Market is pricing this stock without strong emotion in either direction"
Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
⚖️ Buffett Signal
Learn more →The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
Frequently Asked Questions: AON vs MA
Is Aon plc or Mastercard Incorporated more undervalued in 2026?▼
Based on our discounted cash flow model, AON trades at a 36.4% margin of safety (intrinsic value $499 vs. price $318), compared to MA's 14.2% margin of safety (intrinsic $571 vs. $490).
Which stock has a wider economic moat, Aon plc or Mastercard Incorporated?▼
MA scores 99/100 (Wide moat), while AON scores 90/100 (Wide moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.
Is Aon plc in financial distress?▼
AON's Altman Z-Score of 1.8 places it in the Distress zone, signaling elevated bankruptcy risk. MA scores 10.6 (Safe zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.
Which company has better free cash flow, Aon plc or Mastercard Incorporated?▼
Aon plc (AON) generates a 4.9% free cash flow yield, compared to Mastercard Incorporated's 3.7%. A higher FCF yield means the business converts more of its market value into cash that can be returned to shareholders or reinvested.
Which stock has higher return on invested capital, Aon plc or Mastercard Incorporated?▼
MA earns 63.5% ROIC versus AON's 19.4%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.
Which dividend is safer, Aon plc's or Mastercard Incorporated's?▼
MA's dividend earns a safety score of 94/100 (Very Safe), compared to AON's 94/100 (Very Safe). MA has raised its dividend for 3 consecutive years.