ARTHUR J GALLAGHER & CO (AJG) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:AJG - US3635761097 - Common Stock
260.24 USD
-1.59 (-0.61%)
Overall AJG gets a fundamental rating of 5 out of 10. We evaluated AJG against 148 industry peers in the Insurance industry. AJG has an excellent profitability rating, but there are concerns on its financial health. AJG is valued quite expensively, but it does show have an excellent growth rating.
1. Profitability
1.1 Basic Checks
In the past year AJG was profitable.
In the past year AJG had a positive cash flow from operations.
In the past 5 years AJG has always been profitable.
AJG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
AJG has a Return On Assets (2.03%) which is in line with its industry peers.
The Return On Equity of AJG (6.90%) is worse than 70.27% of its industry peers.
AJG has a Return On Invested Capital of 6.70%. This is amongst the best in the industry. AJG outperforms 86.49% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AJG is significantly below the industry average of 14.88%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.03% | ||
| ROE | 6.9% | ||
| ROIC | 6.7% |
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 better Profit Margin (12.29%) than 66.22% of its industry peers.
In the last couple of years the Profit Margin of AJG has grown nicely.
AJG has a better Operating Margin (24.80%) than 83.78% of its industry peers.
AJG's Operating Margin has improved in the last couple of years.
AJG has a better Gross Margin (46.39%) than 92.57% of its industry peers.
AJG's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 24.8% | ||
| PM (TTM) | 12.29% | ||
| GM | 46.39% |
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
AJG has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
AJG has more shares outstanding than it did 1 year ago.
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 1.16, we must say that AJG is in the distress zone and has some risk of bankruptcy.
AJG's Altman-Z score of 1.16 is amongst the best of the industry. AJG outperforms 80.41% of its industry peers.
AJG has a debt to FCF ratio of 7.42. This is a slightly negative value and a sign of low solvency as AJG would need 7.42 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 7.42, AJG is doing worse than 68.24% of the companies in the same industry.
AJG has a Debt/Equity ratio of 0.53. This is a neutral value indicating AJG is somewhat dependend on debt financing.
AJG has a Debt to Equity ratio of 0.53. This is in the lower half of the industry: AJG underperforms 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 7.42 | ||
| Altman-Z | 1.16 |
ROIC/WACC0.85
WACC7.93%
2.3 Liquidity
A Current Ratio of 1.06 indicates that AJG should not have too much problems paying its short term obligations.
AJG has a better Current ratio (1.06) than 79.05% of its industry peers.
AJG has a Quick Ratio of 1.06. This is a normal value and indicates that AJG is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of AJG (1.06) is better than 79.05% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.06 | ||
| Quick Ratio | 1.06 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 5.98% over the past year.
The Earnings Per Share has been growing by 22.61% on average over the past years. This is a very strong growth
Looking at the last year, AJG shows a quite strong growth in Revenue. The Revenue has grown by 15.61% in the last year.
AJG shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.94% yearly.
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
The Earnings Per Share is expected to grow by 16.30% on average over the next years. This is quite good.
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 Y7.15%
EPS Next 2Y15.43%
EPS Next 3Y14.68%
EPS Next 5Y16.3%
Revenue Next Year21.41%
Revenue Next 2Y22.12%
Revenue Next 3Y17.89%
Revenue Next 5Y13.92%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in 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
The Price/Earnings ratio is 24.90, which indicates a rather expensive current valuation of AJG.
Based on the Price/Earnings ratio, AJG is valued a bit more expensive than 73.65% of the companies in the same industry.
When comparing the Price/Earnings ratio of AJG to the average of the S&P500 Index (26.77), we can say AJG is valued inline with the index average.
The Price/Forward Earnings ratio is 19.26, which indicates a rather expensive current valuation of AJG.
AJG's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. AJG is more expensive than 69.59% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of AJG to the average of the S&P500 Index (23.35), we can say AJG is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.9 | ||
| Fwd PE | 19.26 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of AJG indicates a slightly more expensive valuation: AJG is more expensive than 67.57% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, AJG is valued a bit more expensive than 72.30% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 37.82 | ||
| EV/EBITDA | 18.72 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
AJG has a very decent profitability rating, which may justify a higher PE ratio.
AJG's earnings are expected to grow with 14.68% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.48
PEG (5Y)1.1
EPS Next 2Y15.43%
EPS Next 3Y14.68%
5. Dividend
5.1 Amount
With a yearly dividend of 1.00%, AJG is not a good candidate for dividend investing.
AJG's Dividend Yield is comparable with the industry average which is at 2.42.
Compared to an average S&P500 Dividend Yield of 2.00, AJG's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1% |
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 their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.46%
Div Incr Years14
Div Non Decr Years34
5.3 Sustainability
AJG pays out 39.43% of its income as dividend. This is a sustainable payout ratio.
The dividend of AJG is growing, but earnings are growing more, so the dividend growth is sustainable.
DP39.43%
EPS Next 2Y15.43%
EPS Next 3Y14.68%
NYSE:AJG (12/31/2025, 10:48:23 AM)
260.24
-1.59 (-0.61%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners91.8%
Inst Owner Change0.93%
Ins Owners0.6%
Ins Owner Change0.3%
Market Cap66.83B
Revenue(TTM)13.03B
Net Income(TTM)1.60B
Analysts76
Price Target307.26 (18.07%)
Short Float %1.53%
Short Ratio2.21
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1% |
Yearly Dividend2.25
Dividend Growth(5Y)5.46%
DP39.43%
Div Incr Years14
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-6.16%
Min EPS beat(2)-9.74%
Max EPS beat(2)-2.57%
EPS beat(4)2
Avg EPS beat(4)-1.8%
Min EPS beat(4)-9.74%
Max EPS beat(4)3.69%
EPS beat(8)3
Avg EPS beat(8)-1.04%
EPS beat(12)6
Avg EPS beat(12)-1.62%
EPS beat(16)10
Avg EPS beat(16)-0.76%
Revenue beat(2)0
Avg Revenue beat(2)-2.63%
Min Revenue beat(2)-4.45%
Max Revenue beat(2)-0.81%
Revenue beat(4)0
Avg Revenue beat(4)-2.01%
Min Revenue beat(4)-4.45%
Max Revenue beat(4)-0.81%
Revenue beat(8)0
Avg Revenue beat(8)-1.86%
Revenue beat(12)2
Avg Revenue beat(12)-0.85%
Revenue beat(16)5
Avg Revenue beat(16)-0.06%
PT rev (1m)-5.56%
PT rev (3m)-11.36%
EPS NQ rev (1m)-2.37%
EPS NQ rev (3m)-6.84%
EPS NY rev (1m)-1.69%
EPS NY rev (3m)-3.42%
Revenue NQ rev (1m)-0.19%
Revenue NQ rev (3m)-1.66%
Revenue NY rev (1m)-0.57%
Revenue NY rev (3m)-0.01%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.9 | ||
| Fwd PE | 19.26 | ||
| P/S | 5.13 | ||
| P/FCF | 37.82 | ||
| P/OCF | 34.88 | ||
| P/B | 2.88 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.72 |
EPS(TTM)10.45
EY4.02%
EPS(NY)13.51
Fwd EY5.19%
FCF(TTM)6.88
FCFY2.64%
OCF(TTM)7.46
OCFY2.87%
SpS50.74
BVpS90.36
TBVpS-38.01
PEG (NY)3.48
PEG (5Y)1.1
Graham Number145.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.03% | ||
| ROE | 6.9% | ||
| ROCE | 8.44% | ||
| ROIC | 6.7% | ||
| ROICexc | 6.96% | ||
| ROICexgc | 61.85% | ||
| OM | 24.8% | ||
| PM (TTM) | 12.29% | ||
| GM | 46.39% | ||
| FCFM | 13.56% |
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-Score4
Asset Turnover0.16
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 7.42 | ||
| Debt/EBITDA | 2.93 | ||
| Cap/Depr | 15.31% | ||
| Cap/Sales | 1.14% | ||
| Interest Coverage | 5.99 | ||
| Cash Conversion | 45.57% | ||
| Profit Quality | 110.37% | ||
| Current Ratio | 1.06 | ||
| Quick Ratio | 1.06 | ||
| Altman-Z | 1.16 |
F-Score4
WACC7.93%
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 Y7.15%
EPS Next 2Y15.43%
EPS Next 3Y14.68%
EPS Next 5Y16.3%
Revenue 1Y (TTM)15.61%
Revenue growth 3Y12.07%
Revenue growth 5Y9.94%
Sales Q2Q%21.48%
Revenue Next Year21.41%
Revenue Next 2Y22.12%
Revenue Next 3Y17.89%
Revenue Next 5Y13.92%
EBIT growth 1Y46.9%
EBIT growth 3Y27.14%
EBIT growth 5Y27.83%
EBIT Next Year65.44%
EBIT Next 3Y31.73%
EBIT Next 5Y20.35%
FCF growth 1Y31.06%
FCF growth 3Y15.71%
FCF growth 5Y20.01%
OCF growth 1Y24.56%
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 1 / 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 7.15% in the next year.