Arthur J. Gallagher & Co. (AJG) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

Aon Plc

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CorVel Corp.

Ryan Specialty Holdings, Inc.

Hippo Holdings, Inc.

Brown & Brown, Inc.

Crawford & Co.

Arthur J. Gallagher & Co.

Goosehead Insurance, Inc.

GoHealth, Inc.

Why is Arthur J. Gallagher & Co. ?

Strong Long Term Fundamental Strength with an average Return on Equity (ROE) of 11.71%

Negative results in Jun 25

INTEREST(HY) At USD 317 MM has Grown at 69.97%
INTEREST COVERAGE RATIO(Q) Lowest at 539.22

With ROE of 7.19%, it has a very expensive valuation with a 3.77 Price to Book Value

The stock is trading at a premium compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of -12.68%, its profits have risen by 13.6%

Below par performance in long term as well as near term

Along with generating -12.68% returns in the last 1 year, the stock has also underperformed S&P 500 in the last 3 years, 1 year and 3 months

Real-Time Research Report

Verdict Report

How much should you sell?

All quantity irrespective of whether you are making profits or losses

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Capital Markets)

When to re-enter? - We will constantly monitor the company and review our call based on new data

Is Arthur J. Gallagher & Co. for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Arthur J. Gallagher & Co.

-34.84%

-0.12

25.00%

S&P 500

14.9%

0.70

20.15%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

15.11%

EBIT Growth (5y)

19.83%

EBIT to Interest (avg)

6.16

Debt to EBITDA (avg)

Negative Net Debt

Net Debt to Equity (avg)

Sales to Capital Employed (avg)

Tax Ratio

20.67%

Dividend Payout Ratio

45.27%

Pledged Shares

Institutional Holding

94.46%

ROCE (avg)

31.17%

ROE (avg)

11.71%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

2.34

EV to EBIT

20.76

EV to EBITDA

14.42

EV to Capital Employed

2.42

EV to Sales

3.81

PEG Ratio

Dividend Yield

1.22%

ROCE (Latest)

11.67%

ROE (Latest)

6.57%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

RSI

No Signal

Bollinger Bands

Mildly Bearish

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Dow Theory

No Trend

OBV

No Trend

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

5What is working for the Company

DIVIDEND PER SHARE(HY)

Highest at USD 3.07

DIVIDEND PAYOUT RATIO(Y)

Highest at 112.03%

DEBTORS TURNOVER RATIO(HY)

Highest at 3.07 times

NET SALES(Q)

At USD 3,628 MM has Grown at 33.58%

-19What is not working for the Company

INTEREST(HY)

At USD 321.8 MM has Grown at 65.2%

OPERATING CASH FLOW(Y)

Lowest at USD 1,930 MM

ROCE(HY)

Lowest at 6.87%

INTEREST COVERAGE RATIO(Q)

Lowest at 440.99

PRE-TAX PROFIT(Q)

Lowest at USD 187 MM

NET PROFIT(Q)

Lowest at USD 156.99 MM

EPS(Q)

Lowest at USD 0.58

Here's what is working for Arthur J. Gallagher & Co.

Dividend per share

Highest at USD 3.07 and Grown

In each year in the last five years

MOJO Watch

Company is distributing higher dividend from profits generated

DPS (USD)

Net Sales

At USD 3,628 MM has Grown at 33.58%

Year on Year (YoY)

MOJO Watch

Near term sales trend is positive

Net Sales (USD MM)

Debtors Turnover Ratio

Highest at 3.07 times

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its Debtors faster

Debtors Turnover Ratio

Dividend Payout Ratio

Highest at 112.03%

in the last five years

MOJO Watch

Company is distributing higher proportion of profits generated as dividend

DPR (%)

Depreciation

Highest at USD 362 MM

in the last five periods

MOJO Watch

The expenditure on assets done by the company may have gone into operation

Depreciation (USD MM)

Depreciation

At USD 362 MM has Grown at 31.02%

period on period (QoQ)

MOJO Watch

The expenditure on assets done by the company has gone into productive use which should positively reflect in the future sales

Depreciation (USD MM)

Here's what is not working for Arthur J. Gallagher & Co.

Interest

At USD 321.8 MM has Grown at 65.2%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (USD MM)

Interest Coverage Ratio

Lowest at 440.99

in the last five periods

MOJO Watch

The company's ability to manage interest payments is deteriorating

Operating Profit to Interest

Pre-Tax Profit

At USD 187 MM has Fallen at -49.7%

Year on Year (YoY)

MOJO Watch

Near term Pre-Tax Profit trend is very negative

Pre-Tax Profit (USD MM)

Net Profit

At USD 156.99 MM has Fallen at -45.53%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is very negative

Net Profit (USD MM)

Operating Cash Flow

Lowest at USD 1,930 MM

in the last three years

MOJO Watch

The company's cash revenues from business operations are falling

Operating Cash Flows (USD MM)

Pre-Tax Profit

Lowest at USD 187 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (USD MM)

Net Profit

Lowest at USD 156.99 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is negative

Net Profit (USD MM)

EPS

Lowest at USD 0.58

in the last five periods

MOJO Watch

Declining profitability; company has created lower earnings for shareholders

EPS (USD)