Arthur J Gallagher & Co (AJG) AI Stock Analysis

• Market Cap: $67.95B
• Dividend Yield: 1.01%
• Average Volume (3M): 1.45M
• Price to Earnings (P/E): 42.1
• Beta (1Y): 0.38
• Revenue Growth: 17.17%
• EPS Growth: 19.12%
• Country: US
• Employees: 53,714
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Brokers
• EPS (TTM): 2.32
• Shares Outstanding: 256,800,000
• 10 Day Avg. Volume: 1,172,862
• 30 Day Avg. Volume: 1,452,796
• PEG Ratio: 0.91
• Price to Book (P/B): 3.11
• Price to Sales (P/S): 5.42
• P/FCF Ratio: 25.64
• Enterprise Value/Market Cap: 1.37
• Enterprise Value/Revenue: 7.13
• Enterprise Value/Gross Profit: 12.67
• Enterprise Value/Ebitda: 25.69
• 1Y Price Target: $285.67
• Price Target Upside: 7.87% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13
• EPS Forecast (FY): 13.37
• Revenue Forecast (FY): $17.05B

• Rating: 69 Neutral
• Price Target: $290.00 ▲(9.50% Upside)

Arthur J Gallagher & Co's overall stock score is driven by strong financial performance and positive earnings call insights, highlighting robust revenue growth and strategic M&A success. However, technical analysis indicates bearish momentum, and the valuation suggests the stock is relatively expensive, which tempers the overall score.

Positive Factors

Revenue Growth

Sustained revenue growth indicates strong market demand and effective business strategies, enhancing long-term financial stability.

Mergers and Acquisitions Success

Successful M&A activity expands market reach and client base, driving future revenue growth and competitive positioning.

Operational Efficiency

Improved margins reflect efficient cost management, enhancing profitability and providing a buffer against market fluctuations.

Negative Factors

High Debt Levels

High debt levels may limit financial flexibility and increase vulnerability to economic downturns, impacting long-term stability.

Cash Flow Challenges

Low cash conversion efficiency may hinder the ability to fund operations and investments, affecting growth prospects.

Property Market Challenges

Declining property premiums could pressure revenue and margins, challenging the company's ability to maintain growth in this segment.

Arthur J Gallagher & Co Business Overview & Revenue Model

Company Description

Arthur J. Gallagher & Co., together with its subsidiaries, provides insurance brokerage, consulting, third-party claims settlement, and administration services in the United States, Australia, Bermuda, Canada, the Caribbean, New Zealand, India, and the United Kingdom. It operates through Brokerage and Risk Management segments. The Brokerage segment consists of retail and wholesale insurance brokerage operations; assists retail brokers and other non-affiliated brokers in the placement of specialized and hard-to-place insurance; acts as a brokerage wholesaler, managing general agent, and managing general underwriter for distributing specialized insurance coverage's to underwriting enterprises. This segment also performs activities, including marketing, underwriting, issuing policies, collecting premiums, appointing and supervising other agents, paying claims, and negotiating reinsurance; and offers brokerage and consulting services to businesses and organizations, including commercial, not-for-profit, and public entities, as well as individuals in the areas of insurance placement, risk of loss management, and management of employer sponsored benefit programs. The Risk Management segment provides contract claim settlement and administration services to enterprises and public entities; and claims management, loss control consulting, and insurance property appraisal services. The company offers its services through a network of correspondent insurance brokers and consultants. It serves commercial, industrial, public, religious, and not-for-profit entities. The company was incorporated in 1927 and is headquartered in Rolling Meadows, Illinois.

How the Company Makes Money

Arthur J Gallagher & Co primarily generates revenue through commissions and fees earned from providing insurance brokerage services. The company acts as an intermediary between clients and insurance carriers, earning commissions based on the premiums paid by clients for their insurance policies. Additionally, AJG earns revenues from consulting services related to risk management and employee benefits, often charging fees for its advisory services. The company also benefits from significant partnerships with various insurance carriers, allowing it to offer a wide array of products and access to specialized insurance markets. Moreover, acquisitions of smaller brokerage firms contribute to revenue growth by expanding AJG's market reach and client base.

Arthur J Gallagher & Co Financial Statement Overview

Summary

Arthur J Gallagher & Co exhibits strong revenue growth and profitability, supported by efficient cost management and operational efficiency. The balance sheet shows a healthy leverage position, though high debt levels warrant attention. Cash flow metrics indicate potential challenges in cash conversion, but overall cash generation remains robust. The company is well-positioned for continued growth, provided it manages its debt and cash flow effectively.

Income Statement

Arthur J Gallagher & Co has demonstrated strong revenue growth with a TTM revenue increase of 4.48% and consistent annual growth. The gross profit margin has improved to 56.33% in the TTM, indicating efficient cost management. Net profit margin remains stable at 12.29%, reflecting solid profitability. EBIT and EBITDA margins are robust at 20.30% and 27.77%, respectively, showcasing operational efficiency.

Balance Sheet

The company maintains a healthy debt-to-equity ratio of 0.59 in the TTM, showing prudent leverage management. Return on equity is stable at 7.22%, indicating consistent shareholder returns. The equity ratio stands at 29.35%, suggesting a balanced capital structure. However, the relatively high total debt level could pose a risk if not managed carefully.

Cash Flow

Operating cash flow to net income ratio is low at 0.047, indicating potential challenges in converting income to cash. Free cash flow has decreased by 10.37% in the TTM, which may affect future investments. However, the free cash flow to net income ratio remains strong at 0.92, reflecting efficient cash generation relative to earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	13.03B	11.55B	10.07B	8.55B	8.21B	7.01B
Gross Profit	7.34B	4.88B	4.25B	3.60B	2.98B	2.51B
EBITDA	3.62B	3.10B	2.18B	2.18B	1.77B	1.63B
Net Income	1.60B	1.46B	969.50M	1.11B	906.80M	818.80M
Balance Sheet
Total Assets	79.07B	64.26B	51.62B	38.36B	33.34B	22.33B
Cash, Cash Equivalents and Short-Term Investments	1.40B	14.99B	971.50M	738.40M	402.60M	664.60M
Total Debt	13.69B	13.49B	8.32B	6.42B	6.59B	4.87B
Total Liabilities	55.83B	44.08B	40.80B	29.17B	24.78B	16.10B
Stockholders Equity	23.21B	20.15B	10.78B	9.14B	8.51B	6.19B
Cash Flow
Free Cash Flow	1.77B	2.44B	1.84B	1.21B	1.58B	1.65B
Operating Cash Flow	1.92B	2.58B	2.03B	1.39B	1.70B	1.75B
Investing Cash Flow	-16.26B	-1.59B	-3.29B	-1.00B	-3.43B	-416.80M
Financing Cash Flow	14.39B	13.05B	2.87B	212.60M	2.68B	-505.10M

Arthur J Gallagher & Co Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 264.84
• 50DMA: Positive
• 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 Neutral. The current price of 264.84 is above the 20-day moving average (MA) of 258.92, above the 50-day MA of 252.70, and below the 200-day MA of 296.43, indicating a neutral trend. The MACD of 2.88 indicates Negative momentum. The RSI at 60.13 is Neutral, neither overbought nor oversold. The STOCH value of 84.77 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AJG.

Arthur J Gallagher & Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BRO	76 Outperform	$27.53B	24.20	10.47%	0.77%	17.87%	-9.35%
WTW	74 Outperform	$31.62B	15.76	27.79%	1.14%	―	―
ERIE	73 Outperform	$13.06B	22.81	30.44%	1.90%	9.64%	15.87%
MMC	71 Outperform	$91.13B	22.31	28.62%	1.85%	10.57%	2.57%
AJG	69 Neutral	$67.95B	42.10	9.05%	1.01%	17.17%	19.12%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
AON	66 Neutral	$75.40B	28.09	38.33%	0.82%	14.06%	5.52%

Arthur J Gallagher & Co Corporate Events

Arthur J. Gallagher & Co. Plans Investor Meeting

On December 3, 2025, Arthur J. Gallagher & Co. announced plans to host an investor meeting on December 16, 2025. The meeting will be accessible via a webcast on the company’s website, featuring updated CFO Commentary with estimates for 2025 and 2026, and information on net after-tax cash flows from clean energy investments.

The most recent analyst rating on (AJG) stock is a Hold with a $276.00 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 Reports Q3 2025 Revenue Growth

Arthur J. Gallagher & Co. announced its financial results for the third quarter of 2025, reporting significant growth in brokerage revenues, which increased to $2,922.9 million compared to $2,396.4 million in the same quarter of the previous year. This growth highlights the company’s strong market positioning and effective integration of acquisitions, despite challenges such as workforce and lease terminations.

The most recent analyst rating on (AJG) stock is a Hold with a $290.00 price target. To see the full list of analyst forecasts on Arthur J Gallagher & Co stock, see the AJG Stock Forecast page.