Mizuho Raises Arthur J. Gallagher & Co. (NYSE:AJG) Price Target to $300.00

Key Points

• Mizuho raised Arthur J. Gallagher’s price target to $300 from $287 and maintained an “outperform” rating, implying 19.58% upside from the previous close. The broader analyst consensus is “Moderate Buy,” with an average target of $284.71.
• AJG shares fell 2.2% to $250.88 in Friday trading. The company reported adjusted EPS of $2.84, slightly above estimates, while revenue increased 24.3% year over year to $3.95 billion but missed analyst expectations.
• Despite strong headline growth and 6% organic growth, higher expenses and lower interest income contributed to declining net income and GAAP EPS. The company also repurchased about $170 million of stock and declared a quarterly dividend of $0.70 per share.

Arthur J. Gallagher & Co. (NYSE:AJG - Get Free Report) had its price objective lifted by analysts at Mizuho from $287.00 to $300.00 in a research note issued to investors on Friday,Benzinga reports. The firm currently has an "outperform" rating on the financial services provider's stock. Mizuho's price target suggests a potential upside of 19.58% from the company's previous close.

Several other equities analysts have also commented on the company. Wolfe Research lowered Arthur J. Gallagher & Co. from an "outperform" rating to a "peer perform" rating in a research report on Thursday, July 9th. Truist Financial increased their price target on shares of Arthur J. Gallagher & Co. from $225.00 to $265.00 and gave the stock a "hold" rating in a research note on Friday. Morgan Stanley lifted their price target on shares of Arthur J. Gallagher & Co. from $240.00 to $255.00 and gave the company an "overweight" rating in a research report on Monday, July 6th. Barclays boosted their price objective on shares of Arthur J. Gallagher & Co. from $275.00 to $292.00 and gave the stock an "overweight" rating in a research note on Tuesday, July 7th. Finally, Cantor Fitzgerald raised their target price on shares of Arthur J. Gallagher & Co. from $285.00 to $300.00 and gave the company a "neutral" rating in a research note on Thursday, July 9th. Thirteen equities research analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the stock. Based on data from MarketBeat, the company currently has an average rating of "Moderate Buy" and a consensus price target of $284.71.

Arthur J. Gallagher & Co. Stock Down 2.2%

Shares of AJG stock traded down $5.58 during midday trading on Friday, reaching $250.88. 645,557 shares of the stock were exchanged, compared to its average volume of 2,065,588. Arthur J. Gallagher & Co. has a 1 year low of $190.75 and a 1 year high of $313.55. The company's 50 day moving average is $230.78 and its two-hundred day moving average is $224.91. The company has a current ratio of 1.06, a quick ratio of 1.06 and a debt-to-equity ratio of 0.51. The firm has a market cap of $64.45 billion, a PE ratio of 40.57, a price-to-earnings-growth ratio of 1.39 and a beta of 0.50.

Arthur J. Gallagher & Co. (NYSE:AJG - Get Free Report) last released its earnings results on Thursday, July 30th. The financial services provider reported $2.84 EPS for the quarter, beating analysts' consensus estimates of $2.81 by $0.03. The company had revenue of $3.95 billion during the quarter, compared to analysts' expectations of $4.01 billion. Arthur J. Gallagher & Co. had a return on equity of 12.83% and a net margin of 10.76%.The firm's revenue for the quarter was up 24.3% compared to the same quarter last year. During the same quarter last year, the business posted $2.33 EPS. On average, equities research analysts predict that Arthur J. Gallagher & Co. will post 13.22 EPS for the current year.

Insiders Place Their Bets

In other Arthur J. Gallagher & Co. news, CAO Richard C. Cary sold 3,000 shares of Arthur J. Gallagher & Co. stock in a transaction on Tuesday, June 2nd. The stock was sold at an average price of $206.00, for a total value of $618,000.00. Following the completion of the sale, the chief accounting officer owned 47,819 shares of the company's stock, valued at approximately $9,850,714. This trade represents a 5.90% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. 1.40% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Arthur J. Gallagher & Co.

Institutional investors have recently modified their holdings of the business. Kemnay Advisory Services Inc. bought a new stake in Arthur J. Gallagher & Co. in the 4th quarter worth approximately $26,000. Axiom Investment Management LLC purchased a new position in shares of Arthur J. Gallagher & Co. in the 1st quarter worth $28,000. Cassaday & Co Wealth Management LLC bought a new stake in shares of Arthur J. Gallagher & Co. in the first quarter worth $29,000. MV Capital Management Inc. bought a new stake in shares of Arthur J. Gallagher & Co. in the fourth quarter worth $34,000. Finally, Rakuten Securities Inc. increased its position in Arthur J. Gallagher & Co. by 650.0% during the second quarter. Rakuten Securities Inc. now owns 105 shares of the financial services provider's stock valued at $34,000 after acquiring an additional 91 shares during the last quarter. 85.53% of the stock is owned by hedge funds and other institutional investors.

Key Headlines Impacting Arthur J. Gallagher & Co.

Here are the key news stories impacting Arthur J. Gallagher & Co. this week:

• Positive Sentiment: Adjusted earnings of $2.84 per share matched or slightly exceeded consensus expectations, while revenue rose approximately 24% year over year to about $3.95 billion. Combined Brokerage and Risk Management revenue also increased 24%, supported by 6% organic growth and acquisitions. AJG Q2 Earnings Meet Estimates, Revenues Miss on Higher Expenses
• Positive Sentiment: Analysts raised their price targets after the report. Truist lifted its target to $265 from $225 while maintaining a Hold rating, and Keefe, Bruyette & Woods raised its target to $271 from $261 with a Market Perform rating. The revisions indicate improved earnings expectations, although neither firm currently recommends buying the shares. Arthur J. Gallagher Analysts Boost Their Forecasts After Q2 Earnings
• Neutral Sentiment: Gallagher repurchased roughly 900,000 shares for approximately $170 million during the quarter and declared a regular quarterly dividend of $0.70 per share, offering ongoing shareholder returns but limited near-term support for the stock.
• Negative Sentiment: Revenue came in below the roughly $4.01 billion analyst estimate, with higher expenses and lower interest income weighing on results. Reported net income declined to $324 million from $368 million a year earlier, while diluted GAAP EPS fell to $1.25 from $1.40, despite the stronger adjusted EPS figure. Arthur J. Gallagher Q2 Revenue Rises to $3.96 Billion
• Negative Sentiment: Investors had already been concerned that acquisitions were masking slower underlying growth across the insurance-brokerage sector. Gallagher’s 6% organic growth was solid, but the revenue miss and expense pressure appear to have overshadowed the headline growth and earnings performance.

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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