Deutsche Bank Comments On Towers Watson Following Private HC Exchange Conference

In a research report issued today, Deutsche Bank analyst Paul Ginocchio assigned a Buy rating on Towers Watson & Co (NYSE:TW) with a price target of $130/share. In his report, the analyst provided takeaways from the private HC exchange conference.

Ginocchio wrote, “One of the eleven corporates we spoke with at the conference is considering moving to an exchange for 2016. We acknowledge that this is a small sample size taken from an already interested population, but think this level of interest compares favorably to the 3% penetration rate for private healthcare exchanges implied by 2014 data McKinsey presented at the conference.”

The analyst continued, “We spoke to eleven HR managers of major corporates at the conference. Only 9% said they were considering moving to an exchange for 2016 while 27% are considering 2017. All of the companies considering moving to an exchange see TW as a potential exchange vendor, 64% are considering Mercer, 54% are considering AON, and 27% are considering Buck. Potential cost savings, improved plan design/employee choice, and reduced administrative burden were the most common reasons given for considering moving to an exchange.”

According to, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Paul Ginocchio has a total average return of 4.3% and a 41.7% success rate. Ginocchio has a -3.5% average return when recommending TW, and is ranked #893 out of 3319 analysts.

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