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Arthur J Gallagher & Co
(NYSE:AJG)
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Rating:75Outperform
Price Target:
$279.00
â–²(10.12% Upside)
Action:Reiterated
Date:08/09/26
AJG scores well mainly on strong underlying financial performance (durable growth and strong cash generation) and a constructive, guidance-supported earnings call emphasizing continued margin expansion and integration synergies. The score is held back by a premium valuation (high P/E with a modest yield) and only neutral-to-mixed technicals indicating consolidation rather than strong near-term momentum.
Positive Factors
Revenue Growth
Sustained, material top-line expansion across 2021–TTM demonstrates durable demand for AJG’s brokerage and risk-management services and scale benefits. Persistent revenue growth underpins recurring fee/commission income, supports investment in tech and M&A, and provides a stable base for multi-year margin and cash-flow improvement initiatives.
Negative Factors
Margin Compression
A decline in net margin versus the prior year signals pressure on profitability that can persist if mix shifts, higher costs, or pricing headwinds continue. Lower margins weaken cash-flow per dollar of revenue, constrain near-term reinvestment or buybacks, and reduce the cushion for absorbing integration or market shocks.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue Growth
Sustained, material top-line expansion across 2021–TTM demonstrates durable demand for AJG’s brokerage and risk-management services and scale benefits. Persistent revenue growth underpins recurring fee/commission income, supports investment in tech and M&A, and provides a stable base for multi-year margin and cash-flow improvement initiatives.
Read all positive factors
Arthur J Gallagher & Co Key Performance Indicators (KPIs)
Any
Revenue by Segment
Analyzes revenue across different business segments, highlighting which areas are driving growth and where the company might need to improve or capitalize on emerging opportunities.
Analyzes revenue across different business segments, highlighting which areas are driving growth and where the company might need to improve or capitalize on emerging opportunities.
Data provided by:
The Fly
The FlyArthur J Gallagher & Co (AJG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$64.08B
Dividend Yield1.08%
Average Volume (3M)1.69M
Price to Earnings (P/E)40.9
Beta (1Y)0.39
Revenue Growth26.74%
EPS Growth-9.59%
CountryUS
Employees72,000
SectorFinancial
Sector Strength70
IndustryInsurance - Brokers
Share Statistics
EPS (TTM)6.10
Shares Outstanding256,900,000
10 Day Avg. Volume1,312,833
30 Day Avg. Volume1,689,801
Financial Highlights & Ratios
PEG Ratio-3.68
Price to Book (P/B)2.89
Price to Sales (P/S)4.83
P/FCF Ratio37.74
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$290.63Price Target Upside14.71% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering18
EPS Forecast (FY)13.25
Revenue Forecast (FY)$16.73B
Arthur J Gallagher & Co Business Overview & Revenue Model
Company Description
Arthur J. Gallagher & Co., alongside its various subsidiaries, operates globally, providing a wide array of services that encompass insurance brokerage, expert consulting, and outsourced claims settlement and administration. Its geographic reach e...
How the Company Makes Money
AJG primarily makes money through (1) commissions and fees earned in its Brokerage segment and (2) fees earned in its Risk Management segment. Brokerage revenue is generated when AJG places insurance and reinsurance coverage for clients with insur...
Arthur J Gallagher & Co Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 22, 2026
Earnings Call Sentiment Positive
The call presented a predominantly positive operating and financial picture: strong revenue growth (24% total, 6% organic), continued adjusted EBITAC momentum, robust performance at Gallagher Bassett, successful M&A integration (AssuredPartners) with sizable synergy targets, and a healthy M&A pipeline and balance sheet capacity (~$10B). Management highlighted meaningful margin-expansion initiatives tied to productivity and AI with quantified longer-term upside. Offsetting items include Q2 property pricing softness (renewals down 10%), comparability noise from 2025 investment income, a broader industry M&A valuation reset with slightly lower deal cadence (~80% of historical), selective market pressures in cat-exposed property and reinsurance, and the multi-year timeline and execution risk to fully realize AI savings. Overall, positives and momentum materially outweigh the challenges noted, which are largely manageable and/or already acknowledged in guidance.Positive Updates
Strong Top-Line Growth
Combined brokerage and risk management total revenue growth of 24% in Q2 2026; overall organic growth of 6% for the quarter and full-year organic growth outlook of 6% for 2026.
Negative Updates
Property Pricing Softness and Renewal Impact
Property renewal premiums down 10% in Q2 (seasonally heavier property renewal mix drove a more pronounced softness); property pricing moderation reduces rate-driven organic growth.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Top-Line Growth
Combined brokerage and risk management total revenue growth of 24% in Q2 2026; overall organic growth of 6% for the quarter and full-year organic growth outlook of 6% for 2026.
Read all positive updates
Company Guidance
Management reiterated a 2026 full‑year organic growth outlook of 6% (brokerage ~5.5%, risk management ~9%) after Q2 where combined brokerage and risk management revenues grew 24% (brokerage +26%, brokerage organic ~5%; Gallagher Bassett +16%, organic 12%), and noted adjusted revenues/EBITAC/EPS (ex‑AP fund investment income) were each up >30%; they forecast Q3 and full‑year adjusted EBITAC margins north of 22%, with GB’s Q2 adjusted EBITAC margin at 22.3% (up 140 bps) and brokerage delivering ~50 bps of underlying margin expansion in Q2 and 40–60 bps for full‑year 2026. On M&A they closed 7 tuck‑ins in Q2 (~$63M annualized revenue), have 30+ term sheets (~$500M annualized) in the pipeline, reported AssuredPartners Q2 EBITA of $222M and reiterated $160M run‑rate synergies by end‑2026 (up to $325M by early‑2028). Capital items: repurchased ~850k shares (~$170M) in Q2 ($480M YTD), see ~ $10B of deployment capacity over two years, and expect cash taxes to be roughly 10% of EBITA given ~$3.4B of future tax shields.Arthur J Gallagher & Co Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
74
Positive
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 15.75B | 13.94B | 11.55B | 10.07B | 8.55B | 8.21B |
| Gross Profit | 11.75B | 7.63B | 4.88B | 4.25B | 3.60B | 2.98B |
| EBITDA | 3.97B | 3.66B | 3.10B | 2.18B | 2.18B | 1.77B |
| Net Income | 1.57B | 1.49B | 1.46B | 969.50M | 1.11B | 906.80M |
Balance Sheet | ||||||
| Total Assets | 81.81B | 70.67B | 64.26B | 51.62B | 38.36B | 33.34B |
| Cash, Cash Equivalents and Short-Term Investments | 1.39B | 1.40B | 14.99B | 971.50M | 738.40M | 402.60M |
| Total Debt | 2.02B | 14.00B | 13.49B | 8.32B | 6.42B | 6.59B |
| Total Liabilities | 58.06B | 47.32B | 44.08B | 40.80B | 29.17B | 24.78B |
| Stockholders Equity | 23.72B | 23.32B | 20.15B | 10.78B | 9.14B | 8.51B |
Cash Flow | ||||||
| Free Cash Flow | 2.29B | 1.78B | 2.44B | 1.84B | 1.21B | 1.58B |
| Operating Cash Flow | 2.45B | 1.93B | 2.58B | 2.03B | 1.39B | 1.70B |
| Investing Cash Flow | -14.85B | -15.88B | -1.59B | -3.29B | -1.00B | -3.43B |
| Financing Cash Flow | 928.70M | 1.72B | 13.05B | 2.87B | 212.60M | 2.68B |
Arthur J Gallagher & Co Technical Analysis
Neutral
253.36
Price Trends
234.91
Positive
222.73
Positive
233.00
Positive
Market Momentum
3.74
Positive
50.92
Neutral
32.49
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AJG, the sentiment is Neutral. The current price of 253.36 is above the 20-day moving average (MA) of 252.36, above the 50-day MA of 234.91, and above the 200-day MA of 233.00, indicating a neutral trend. The MACD of 3.74 indicates Positive momentum. The RSI at 50.92 is Neutral, neither overbought nor oversold. The STOCH value of 32.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AJG.
Arthur J Gallagher & Co Risk Analysis
Arthur J Gallagher & Co disclosed 31 risk factors in its most recent earnings report. Arthur J Gallagher & Co reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Arthur J Gallagher & Co Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $76.48B | 19.77 | 42.56% | 0.83% | 4.36% | 51.69% | |
79 Outperform | $23.56B | 19.45 | 9.62% | 0.95% | 34.22% | 3.21% | |
78 Outperform | $11.27B | 20.85 | 24.52% | 2.57% | 3.65% | -7.67% | |
77 Outperform | $31.20B | 20.60 | 19.95% | 1.27% | 3.00% | 914.66% | |
75 Outperform | $64.08B | 40.89 | 6.91% | 1.07% | 26.74% | -9.59% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
AJG
Arthur J Gallagher & Co
248.12
-37.58
-13.15%
AON
Aon
358.30
-6.41
-1.76%
BRO
Brown & Brown
71.43
-22.33
-23.82%
ERIE
Erie Indemnity Company
252.58
-100.79
-28.52%
WTW
Willis Towers Watson
344.82
19.71
6.06%
Arthur J Gallagher & Co Corporate Events
Business Operations and StrategyFinancial Disclosures
Arthur J Gallagher posts strong Q2 2026 results
Positive
Jul 30, 2026
Arthur J. Gallagher Co. reported its second quarter 2026 financial results on July 30, 2026, highlighting strong growth in its core brokerage and risk management segments. Brokerage revenues before reimbursements rose to $3.50 billion from $2.79 ...
Executive/Board Changes
Arthur J Gallagher reshapes board leadership after director’s passing
Negative
Jul 29, 2026
On July 22, 2026, Arthur J. Gallagher Co. announced the passing of David Johnson, who served as Lead Independent Director on the company’s Board of Directors for more than two decades. Johnson was praised by Chairman and CEO J. Patrick Gall...
Business Operations and StrategyFinancial Disclosures
Arthur J. Gallagher Schedules 2026 Outlook Investor Meeting
Neutral
Jun 17, 2026
Arthur J. Gallagher Co. announced on June 3, 2026, that it will host an investor meeting on Wednesday, June 17, 2026, providing shareholders and analysts with updated insight into its financial outlook. The company will offer a webcast and relate...
Executive/Board ChangesShareholder Meetings
Arthur J. Gallagher Stockholders Back Board, Pay, Auditor
Positive
May 13, 2026
Arthur J. Gallagher Co. held its Annual Meeting of Stockholders on May 12, 2026, at which shareholders elected all nine director nominees to serve until the 2027 Annual Meeting. The voting results showed broad support for the board slate, indicat...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.