After Towers Watson (TW) agreed to merge with Willis Group (WSH), Stifel says that the decline in Towers' stock was overdone. The firm says that some investors are worried that the move signals that Towers Watson is worried about its exchange business. However, the firm believes that Towers Watson made the deal in order to acquire the distribution channel in the hottest part of the exchange business. Stifel thinks that the combined company can generate $10+ in EPS by 2018. It trimmed its price target on Towers Watson to $143 from $148 but keeps a Buy rating on the shares.