Arthur J. Gallagher & Co. (NYSE:AJG) Receives Average Rating of "Moderate Buy" from Analysts

Key Points

• Analysts give Arthur J. Gallagher a consensus "Moderate Buy" rating (10 buys, 9 holds) with an average 1‑year price target of about $273.82, though brokers have recently mixed views—Piper Sandler and Wells Fargo cut targets while RBC initiated coverage with an outperform and $260 target.
• Two company VPs recently sold shares (4,000 and 3,800 shares at roughly $227 each), leaving insiders with just 1.6% ownership, while institutional investors hold 85.53% of the stock with large increases from Vanguard, JPMorgan and Capital World and a new Norges Bank position.
• Latest quarter: EPS of $2.38 beat estimates and revenue rose 33.9% year‑over‑year; the company has a market cap of about $55.9B, a P/E of 35.37, and raised its quarterly dividend to $0.70 (1.3% yield).

Shares of Arthur J. Gallagher & Co. (NYSE:AJG - Get Free Report) have received a consensus recommendation of "Moderate Buy" from the nineteen analysts that are covering the firm, Marketbeat reports. Nine analysts have rated the stock with a hold recommendation and ten have given a buy recommendation to the company. The average 1 year price target among brokerages that have issued a report on the stock in the last year is $273.8235.

Several brokerages recently weighed in on AJG. Piper Sandler dropped their price objective on Arthur J. Gallagher & Co. from $249.00 to $226.00 and set a "neutral" rating for the company in a research report on Monday, February 23rd. Cantor Fitzgerald reiterated a "neutral" rating on shares of Arthur J. Gallagher & Co. in a research report on Friday, January 30th. Royal Bank Of Canada began coverage on shares of Arthur J. Gallagher & Co. in a report on Tuesday, March 17th. They issued an "outperform" rating and a $260.00 target price for the company. Wall Street Zen upgraded shares of Arthur J. Gallagher & Co. from a "sell" rating to a "hold" rating in a research note on Saturday, February 21st. Finally, Wells Fargo & Company lowered their price objective on shares of Arthur J. Gallagher & Co. from $298.00 to $273.00 and set an "overweight" rating for the company in a research report on Thursday, March 19th.

Insider Buying and Selling at Arthur J. Gallagher & Co.

In related news, VP Christopher E. Mead sold 4,000 shares of the firm's stock in a transaction on Thursday, March 5th. The stock was sold at an average price of $227.12, for a total transaction of $908,480.00. Following the sale, the vice president owned 19,306 shares of the company's stock, valued at $4,384,778.72. This trade represents a 17.16% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, VP Scott R. Hudson sold 3,800 shares of the business's stock in a transaction on Friday, March 6th. The stock was sold at an average price of $227.57, for a total value of $864,766.00. Following the sale, the vice president owned 85,920 shares in the company, valued at $19,552,814.40. This represents a 4.24% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Company insiders own 1.60% of the company's stock.

Institutional Inflows and Outflows

A number of large investors have recently added to or reduced their stakes in AJG. Vanguard Group Inc. increased its position in Arthur J. Gallagher & Co. by 0.7% in the 4th quarter. Vanguard Group Inc. now owns 31,390,446 shares of the financial services provider's stock valued at $8,123,534,000 after acquiring an additional 217,136 shares during the period. JPMorgan Chase & Co. lifted its holdings in shares of Arthur J. Gallagher & Co. by 19.6% during the third quarter. JPMorgan Chase & Co. now owns 20,338,533 shares of the financial services provider's stock worth $6,299,674,000 after purchasing an additional 3,330,205 shares during the period. Capital World Investors grew its stake in shares of Arthur J. Gallagher & Co. by 7.0% in the fourth quarter. Capital World Investors now owns 12,613,371 shares of the financial services provider's stock worth $3,264,359,000 after purchasing an additional 830,252 shares during the last quarter. State Street Corp increased its holdings in Arthur J. Gallagher & Co. by 0.6% in the fourth quarter. State Street Corp now owns 10,953,598 shares of the financial services provider's stock valued at $2,834,682,000 after purchasing an additional 62,518 shares during the period. Finally, Norges Bank bought a new position in Arthur J. Gallagher & Co. during the 4th quarter worth $1,925,062,000. Institutional investors own 85.53% of the company's stock.

Arthur J. Gallagher & Co. Stock Performance

NYSE AJG opened at $217.54 on Friday. Arthur J. Gallagher & Co. has a 1 year low of $195.00 and a 1 year high of $351.23. The firm has a market capitalization of $55.93 billion, a price-to-earnings ratio of 35.37, a P/E/G ratio of 1.08 and a beta of 0.68. The company has a current ratio of 1.06, a quick ratio of 1.06 and a debt-to-equity ratio of 0.52. The firm's 50 day simple moving average is $221.52 and its 200 day simple moving average is $251.59.

Arthur J. Gallagher & Co. (NYSE:AJG - Get Free Report) last released its earnings results on Thursday, January 29th. The financial services provider reported $2.38 earnings per share for the quarter, topping the consensus estimate of $2.35 by $0.03. The firm had revenue of $3.57 billion during the quarter, compared to analysts' expectations of $3.61 billion. Arthur J. Gallagher & Co. had a return on equity of 12.13% and a net margin of 11.84%.The company's quarterly revenue was up 33.9% on a year-over-year basis. During the same period in the prior year, the company earned $1.12 earnings per share. As a group, research analysts expect that Arthur J. Gallagher & Co. will post 11.54 earnings per share for the current fiscal year.

Arthur J. Gallagher & Co. Increases Dividend

The business also recently declared a quarterly dividend, which was paid on Friday, March 20th. Stockholders of record on Friday, March 6th were issued a dividend of $0.70 per share. This represents a $2.80 annualized dividend and a dividend yield of 1.3%. This is a boost from Arthur J. Gallagher & Co.'s previous quarterly dividend of $0.65. The ex-dividend date was Friday, March 6th. Arthur J. Gallagher & Co.'s dividend payout ratio (DPR) is currently 45.53%.

Arthur J. Gallagher & Co. Company Profile

Arthur J. Gallagher & Co is a global insurance brokerage and risk management firm headquartered in Rolling Meadows, Illinois. Founded in 1927 by Arthur J. Gallagher, the company has grown from a regional broker into an international professional services organization that arranges insurance, provides consulting and designs risk-transfer solutions for commercial, industrial, public sector and individual clients.

The company's core activities include property and casualty insurance brokerage, employee benefits consulting and administration, and a range of risk management services.

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