ARTHUR J GALLAGHER & CO (AJG) Stock Fundamental Analysis
USA - NYSE:AJG - US3635761097 - Common Stock
254.87 USD
-0.13 (-0.05%)
We assign a fundamental rating of 5 out of 10 to AJG. AJG was compared to 146 industry peers in the Insurance industry. AJG scores excellent on profitability, but there are concerns on its financial health. AJG is valued quite expensive, but it does show an excellent growth.
1. Profitability
1.1 Basic Checks
In the past year AJG was profitable.
AJG had a positive operating cash flow in the past year.
In the past 5 years AJG has always been profitable.
Each year in the past 5 years AJG had a positive operating cash flow.
1.2 Ratios
AJG has a Return On Assets of 2.05%. This is comparable to the rest of the industry: AJG outperforms 52.05% of its industry peers.
The Return On Equity of AJG (7.13%) is worse than 69.86% of its industry peers.
Looking at the Return On Invested Capital, with a value of 6.72%, AJG belongs to the top of the industry, outperforming 87.67% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for AJG is above the industry average of 4.51%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.05% | ||
| ROE | 7.13% | ||
| ROIC | 6.72% |
ROA(3y)2.35%
ROA(5y)2.69%
ROE(3y)9.48%
ROE(5y)10.47%
ROIC(3y)7.35%
ROIC(5y)7.18%
1.3 Margins
AJG has a Profit Margin of 13.16%. This is in the better half of the industry: AJG outperforms 74.66% of its industry peers.
In the last couple of years the Profit Margin of AJG has grown nicely.
AJG has a Operating Margin of 25.44%. This is amongst the best in the industry. AJG outperforms 89.73% of its industry peers.
In the last couple of years the Operating Margin of AJG has grown nicely.
Looking at the Gross Margin, with a value of 46.51%, AJG belongs to the top of the industry, outperforming 93.84% of the companies in the same industry.
AJG's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.44% | ||
| PM (TTM) | 13.16% | ||
| GM | 46.51% |
OM growth 3Y13.45%
OM growth 5Y16.28%
PM growth 3Y4.65%
PM growth 5Y6.37%
GM growth 3Y6.97%
GM growth 5Y6.66%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so AJG is destroying value.
Compared to 1 year ago, AJG has more shares outstanding
AJG has more shares outstanding than it did 5 years ago.
AJG has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.30, we must say that AJG is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of AJG (1.30) is better than 80.82% of its industry peers.
AJG has a debt to FCF ratio of 6.54. This is a slightly negative value and a sign of low solvency as AJG would need 6.54 years to pay back of all of its debts.
AJG has a worse Debt to FCF ratio (6.54) than 64.38% of its industry peers.
AJG has a Debt/Equity ratio of 0.53. This is a neutral value indicating AJG is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.53, AJG is not doing good in the industry: 70.55% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 6.54 | ||
| Altman-Z | 1.3 |
ROIC/WACC0.85
WACC7.92%
2.3 Liquidity
A Current Ratio of 1.36 indicates that AJG should not have too much problems paying its short term obligations.
The Current ratio of AJG (1.36) is better than 84.93% of its industry peers.
AJG has a Quick Ratio of 1.36. This is a normal value and indicates that AJG is financially healthy and should not expect problems in meeting its short term obligations.
With an excellent Quick ratio value of 1.36, AJG belongs to the best of the industry, outperforming 84.93% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.36 | ||
| Quick Ratio | 1.36 |
3. Growth
3.1 Past
AJG shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.98%.
AJG shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 22.61% yearly.
AJG shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 15.61%.
Measured over the past years, AJG shows a quite strong growth in Revenue. The Revenue has been growing by 9.94% on average per year.
EPS 1Y (TTM)5.98%
EPS 3Y22.62%
EPS 5Y22.61%
EPS Q2Q%2.65%
Revenue 1Y (TTM)15.61%
Revenue growth 3Y12.07%
Revenue growth 5Y9.94%
Sales Q2Q%21.48%
3.2 Future
AJG is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.30% yearly.
AJG is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.92% yearly.
EPS Next Y8.99%
EPS Next 2Y16.08%
EPS Next 3Y14.75%
EPS Next 5Y16.3%
Revenue Next Year22.11%
Revenue Next 2Y22.43%
Revenue Next 3Y17.77%
Revenue Next 5Y13.92%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 24.39, AJG is valued on the expensive side.
Based on the Price/Earnings ratio, AJG is valued a bit more expensive than the industry average as 76.03% of the companies are valued more cheaply.
AJG is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.35, which is the current average of the S&P500 Index.
AJG is valuated rather expensively with a Price/Forward Earnings ratio of 18.65.
69.18% of the companies in the same industry are cheaper than AJG, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of AJG to the average of the S&P500 Index (33.72), we can say AJG is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.39 | ||
| Fwd PE | 18.65 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, AJG is valued a bit more expensive than 60.27% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, AJG is valued a bit more expensive than the industry average as 68.49% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.14 | ||
| EV/EBITDA | 15.64 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of AJG may justify a higher PE ratio.
A more expensive valuation may be justified as AJG's earnings are expected to grow with 14.75% in the coming years.
PEG (NY)2.71
PEG (5Y)1.08
EPS Next 2Y16.08%
EPS Next 3Y14.75%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.06%, AJG has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.45, AJG has a dividend in line with its industry peers.
With a Dividend Yield of 1.06, AJG pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
5.2 History
The dividend of AJG has a limited annual growth rate of 5.46%.
AJG has paid a dividend for at least 10 years, which is a reliable track record.
AJG has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.46%
Div Incr Years14
Div Non Decr Years34
5.3 Sustainability
36.32% of the earnings are spent on dividend by AJG. This is a low number and sustainable payout ratio.
The dividend of AJG is growing, but earnings are growing more, so the dividend growth is sustainable.
DP36.32%
EPS Next 2Y16.08%
EPS Next 3Y14.75%
NYSE:AJG (11/12/2025, 11:19:01 AM)
254.87
-0.13 (-0.05%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners90.89%
Inst Owner Change0.57%
Ins Owners0.6%
Ins Owner Change1.26%
Market Cap65.34B
Revenue(TTM)13.03B
Net Income(TTM)1.64B
Analysts75.83
Price Target347.85 (36.48%)
Short Float %1.5%
Short Ratio2.81
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
Yearly Dividend2.25
Dividend Growth(5Y)5.46%
DP36.32%
Div Incr Years14
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.57%
Min EPS beat(2)-2.57%
Max EPS beat(2)1.43%
EPS beat(4)2
Avg EPS beat(4)0.27%
Min EPS beat(4)-2.57%
Max EPS beat(4)3.69%
EPS beat(8)4
Avg EPS beat(8)0.38%
EPS beat(12)7
Avg EPS beat(12)-0.62%
EPS beat(16)11
Avg EPS beat(16)0.38%
Revenue beat(2)0
Avg Revenue beat(2)-0.86%
Min Revenue beat(2)-0.9%
Max Revenue beat(2)-0.81%
Revenue beat(4)0
Avg Revenue beat(4)-1.44%
Min Revenue beat(4)-2.19%
Max Revenue beat(4)-0.81%
Revenue beat(8)0
Avg Revenue beat(8)-1.32%
Revenue beat(12)2
Avg Revenue beat(12)-0.52%
Revenue beat(16)6
Avg Revenue beat(16)1.13%
PT rev (1m)-0.15%
PT rev (3m)0.84%
EPS NQ rev (1m)0.54%
EPS NQ rev (3m)4.67%
EPS NY rev (1m)-1.76%
EPS NY rev (3m)-0.87%
Revenue NQ rev (1m)1.96%
Revenue NQ rev (3m)5.83%
Revenue NY rev (1m)-0.38%
Revenue NY rev (3m)0.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.39 | ||
| Fwd PE | 18.65 | ||
| P/S | 5.24 | ||
| P/FCF | 33.14 | ||
| P/OCF | 30.82 | ||
| P/B | 2.84 | ||
| P/tB | 15.74 | ||
| EV/EBITDA | 15.64 |
EPS(TTM)10.45
EY4.1%
EPS(NY)13.66
Fwd EY5.36%
FCF(TTM)7.69
FCFY3.02%
OCF(TTM)8.27
OCFY3.24%
SpS48.65
BVpS89.81
TBVpS16.19
PEG (NY)2.71
PEG (5Y)1.08
Graham Number145.31
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.05% | ||
| ROE | 7.13% | ||
| ROCE | 8.44% | ||
| ROIC | 6.72% | ||
| ROICexc | 10.82% | ||
| ROICexgc | 55.53% | ||
| OM | 25.44% | ||
| PM (TTM) | 13.16% | ||
| GM | 46.51% | ||
| FCFM | 15.81% |
ROA(3y)2.35%
ROA(5y)2.69%
ROE(3y)9.48%
ROE(5y)10.47%
ROIC(3y)7.35%
ROIC(5y)7.18%
ROICexc(3y)9.13%
ROICexc(5y)8.37%
ROICexgc(3y)48.09%
ROICexgc(5y)40.27%
ROCE(3y)9.3%
ROCE(5y)9.1%
ROICexgc growth 3Y31.7%
ROICexgc growth 5Y18.43%
ROICexc growth 3Y18.63%
ROICexc growth 5Y11.64%
OM growth 3Y13.45%
OM growth 5Y16.28%
PM growth 3Y4.65%
PM growth 5Y6.37%
GM growth 3Y6.97%
GM growth 5Y6.66%
F-Score6
Asset Turnover0.16
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 6.54 | ||
| Debt/EBITDA | 3 | ||
| Cap/Depr | 16.31% | ||
| Cap/Sales | 1.19% | ||
| Interest Coverage | 7.87 | ||
| Cash Conversion | 51.96% | ||
| Profit Quality | 120.15% | ||
| Current Ratio | 1.36 | ||
| Quick Ratio | 1.36 | ||
| Altman-Z | 1.3 |
F-Score6
WACC7.92%
ROIC/WACC0.85
Cap/Depr(3y)25.04%
Cap/Depr(5y)23.1%
Cap/Sales(3y)1.76%
Cap/Sales(5y)1.65%
Profit Quality(3y)176.95%
Profit Quality(5y)182.63%
High Growth Momentum
Growth
EPS 1Y (TTM)5.98%
EPS 3Y22.62%
EPS 5Y22.61%
EPS Q2Q%2.65%
EPS Next Y8.99%
EPS Next 2Y16.08%
EPS Next 3Y14.75%
EPS Next 5Y16.3%
Revenue 1Y (TTM)15.61%
Revenue growth 3Y12.07%
Revenue growth 5Y9.94%
Sales Q2Q%21.48%
Revenue Next Year22.11%
Revenue Next 2Y22.43%
Revenue Next 3Y17.77%
Revenue Next 5Y13.92%
EBIT growth 1Y51.53%
EBIT growth 3Y27.14%
EBIT growth 5Y27.83%
EBIT Next Year67.25%
EBIT Next 3Y31.74%
EBIT Next 5Y20.35%
FCF growth 1Y21.9%
FCF growth 3Y15.71%
FCF growth 5Y20.01%
OCF growth 1Y17.9%
OCF growth 3Y14.87%
OCF growth 5Y18.21%
ARTHUR J GALLAGHER & CO / AJG FAQ
Can you provide the ChartMill fundamental rating for ARTHUR J GALLAGHER & CO?
ChartMill assigns a fundamental rating of 5 / 10 to AJG.
What is the valuation status for AJG stock?
ChartMill assigns a valuation rating of 2 / 10 to ARTHUR J GALLAGHER & CO (AJG). This can be considered as Overvalued.
How profitable is ARTHUR J GALLAGHER & CO (AJG) stock?
ARTHUR J GALLAGHER & CO (AJG) has a profitability rating of 7 / 10.
How financially healthy is ARTHUR J GALLAGHER & CO?
The financial health rating of ARTHUR J GALLAGHER & CO (AJG) is 3 / 10.
What is the earnings growth outlook for ARTHUR J GALLAGHER & CO?
The Earnings per Share (EPS) of ARTHUR J GALLAGHER & CO (AJG) is expected to grow by 8.99% in the next year.