Arthur J Gallagher & Co (AJG) AI Stock Analysis

• Market Cap: $75.05B
• Dividend Yield: 0.85%
• Average Volume (3M): 1.51M
• Price to Earnings (P/E): 44.1
• Beta (1Y): 0.42
• Revenue Growth: 15.03%
• EPS Growth: 28.86%
• Country: US
• Employees: 53,714
• Sector: Financial
• Sector Strength: 65
• Industry: Insurance - Brokers
• EPS (TTM): 2.33
• Shares Outstanding: 256,400,000
• 10 Day Avg. Volume: 1,610,491
• 30 Day Avg. Volume: 1,508,446
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.10
• Enterprise Value/Revenue: 6.60
• Enterprise Value/Gross Profit: 15.15
• Enterprise Value/Ebitda: 23.55
• 1Y Price Target: $341.83
• Price Target Upside: 16.78% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

• Rating: 68 Neutral
• Price Target: $313.00 ▲(6.93% Upside)

Arthur J Gallagher & Co's overall stock score reflects strong financial performance and positive earnings call sentiment, which are offset by bearish technical indicators and a high valuation. The company's robust revenue growth and strategic M&A activity are significant strengths, while challenges in the property insurance market and valuation concerns present risks.

Positive Factors

Earnings

First-quarter cash EPS of $3.67 beat consensus by $0.10, driven by better-than-expected 8.5% organic growth.

Financial Performance

Healthy wage inflation and effective expense management are expected to support AJG's continued growth.

Market Position

AJG's market share is estimated to be double that of its closest competitor, Marsh, indicating a strong position in the market.

Negative Factors

Deal Risks

Delays in closing the deal arguably increase the risk of AP employee attrition, and failure to close the deal would be a risk to above-consensus AJG revenue estimates.

Organic Growth Challenges

There are expectations of slower property growth impacting all brokers, including AJG.

Regulatory Challenges

The announcement of a longer regulatory review period related to its acquisition of Assured Partners was surprising given AJG's SME market shares.

Arthur J Gallagher & Co Business Overview & Revenue Model

Company Description

Arthur J Gallagher & Co (AJG) is a global insurance brokerage and risk management services firm headquartered in Itasca, Illinois. Established in 1927, AJG operates in various sectors, including commercial insurance, employee benefits, and personal insurance. The company offers a wide range of services such as risk management consulting, insurance brokerage, and underwriting, serving clients from small businesses to large corporations across diverse industries.

How the Company Makes Money

AJG generates revenue primarily through commissions and fees earned from its insurance brokerage services, where it acts as an intermediary between clients and insurance carriers. The company charges clients for consulting services related to risk management and employee benefits, providing tailored solutions to meet their specific needs. Key revenue streams include the brokerage of property and casualty insurance, employee benefits consulting, and risk management services. AJG also earns income from the sale of insurance products and services, as well as from its global network of partnerships with various insurance providers, enhancing its service offerings and market reach. Additionally, AJG's growth strategy includes acquisitions of smaller agencies, which expands its client base and revenue potential.

Arthur J Gallagher & Co Financial Statement Overview

Summary

Arthur J Gallagher & Co exhibits strong financial health with consistent revenue growth and solid profitability margins. The balance sheet is robust with low leverage and stable returns on equity. While cash flow generation has seen some decline, the company maintains a strong cash conversion ratio, indicating resilience. Overall, the financial position is strong, with opportunities to enhance cash flow efficiency.

Income Statement

Arthur J Gallagher & Co has demonstrated consistent revenue growth with a 3.7% increase in TTM, following a strong 14.7% growth in the previous year. The company maintains healthy profitability with a gross profit margin of 55.18% and a net profit margin of 13.16% in TTM. EBIT and EBITDA margins are also robust at 20.97% and 28.25%, respectively, indicating efficient operations and cost management.

Balance Sheet

The company's balance sheet shows a strong equity position with a debt-to-equity ratio of 0.67 in the latest annual report, improving to 0.05 in TTM, reflecting reduced leverage. Return on equity is stable at 8.45% in TTM, suggesting effective use of shareholder funds. The equity ratio stands at 28.73%, indicating a solid capital structure.

Cash Flow

Cash flow analysis reveals a decline in free cash flow growth by 21.91% in TTM, which is a concern. However, the company maintains a strong free cash flow to net income ratio of 93.02%, indicating good cash conversion. The operating cash flow to net income ratio is lower at 4.98%, suggesting potential areas for improvement in cash generation from operations.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	12.47B	11.55B	10.07B	8.55B	8.21B	7.01B
Gross Profit	5.44B	4.88B	4.25B	3.60B	2.98B	2.51B
EBITDA	3.50B	3.10B	2.18B	2.18B	1.77B	1.63B
Net Income	1.64B	1.46B	969.50M	1.11B	906.80M	818.80M
Balance Sheet
Total Assets	80.12B	64.26B	51.62B	38.36B	33.34B	22.33B
Cash, Cash Equivalents and Short-Term Investments	14.30B	14.99B	971.50M	738.40M	402.60M	664.60M
Total Debt	13.30B	13.49B	8.32B	6.42B	6.59B	4.87B
Total Liabilities	57.07B	44.08B	40.80B	29.17B	24.78B	16.10B
Stockholders Equity	23.02B	20.18B	10.78B	9.14B	8.51B	6.19B
Cash Flow
Free Cash Flow	1.97B	2.44B	1.84B	1.21B	1.58B	1.65B
Operating Cash Flow	2.12B	2.58B	2.03B	1.39B	1.70B	1.75B
Investing Cash Flow	-2.71B	-1.59B	-3.29B	-1.00B	-3.43B	-416.80M
Financing Cash Flow	14.43B	13.05B	2.87B	212.60M	2.68B	-505.10M

Arthur J Gallagher & Co Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 292.72
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AJG, the sentiment is Negative. The current price of 292.72 is below the 20-day moving average (MA) of 295.36, below the 50-day MA of 308.46, and below the 200-day MA of 311.83, indicating a bearish trend. The MACD of -5.65 indicates Negative momentum. The RSI at 41.94 is Neutral, neither overbought nor oversold. The STOCH value of 86.97 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AJG.

Arthur J Gallagher & Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AON	78 Outperform	$78.99B	30.67	37.99%	0.77%	18.42%	-4.44%
ERIE	76 Outperform	$17.14B	31.03	31.14%	1.47%	12.19%	17.82%
WTW	70 Outperform	$32.24B	230.97	1.57%	1.09%	1.27%	-84.75%
AJG	68 Neutral	$75.05B	44.12	9.49%	0.85%	15.03%	28.86%
Sector *	68 Neutral	$17.53B	11.78	10.42%	3.83%	9.94%	1.31%
MMC	67 Neutral	$101.87B	24.87	28.33%	1.61%	9.22%	3.05%
BRO	66 Neutral	$31.45B	27.49	11.27%	0.63%	11.68%	-0.17%

Arthur J Gallagher & Co Corporate Events

Arthur J Gallagher & Co Q2 2025 Revenue Surge

On July 31, 2025, Arthur J. Gallagher & Co. announced its financial results for the second quarter ending June 30, 2025. The company reported an increase in brokerage revenue to $2,785.6 million from $2,376.3 million in the same quarter of the previous year, reflecting strong operational performance. The results indicate a positive trajectory for the company, potentially enhancing its market position and benefiting stakeholders.

The most recent analyst rating on (AJG) stock is a Buy with a $301.00 price target. To see the full list of analyst forecasts on Arthur J Gallagher & Co stock, see the AJG Stock Forecast page.

Arthur J. Gallagher & Co. Hosts Investor Meeting

Arthur J. Gallagher & Co. announced plans to host an investor meeting on June 4, 2025, with a webcast and presentation materials available on the company’s investor relations page. The presentation includes estimates for 2025 results and net after-tax cash flows from clean energy investments, highlighting the company’s focus on future financial performance and sustainability initiatives.

The most recent analyst rating on (AJG) stock is a Buy with a $282.00 price target. To see the full list of analyst forecasts on Arthur J Gallagher & Co stock, see the AJG Stock Forecast page.

Arthur J. Gallagher & Co. Holds Annual Stockholders Meeting

On May 13, 2025, Arthur J. Gallagher & Co. held its Annual Meeting of Stockholders, where all ten director nominees were elected to serve until the 2026 Annual Meeting. Additionally, the stockholders approved the appointment of Ernst & Young LLP as the independent auditor for the fiscal year ending December 31, 2025, and endorsed the executive officers’ compensation on a non-binding advisory basis. These decisions reflect the company’s ongoing commitment to strong governance and stakeholder engagement.

The most recent analyst rating on (AJG) stock is a Buy with a $345.00 price target. To see the full list of analyst forecasts on Arthur J Gallagher & Co stock, see the AJG Stock Forecast page.