Upside case
Bull case
$281+42.7%
AJG would need investors to value it at roughly 21x earnings — about 6x more generous than today's 15x forward P/E. That requires meaningful multiple expansion on top of continued earnings growth.
Analysis OverviewBuyUpdated May 1, 2026
Arthur J. Gallagher & Co. (AJG) Stock Analysis
Wall Street verdict, consensus price target, and analyst rating breakdown — everything needed to frame the risk/reward at today's price.
Analyst consensus
Buy
Covering
29
analysts
14 bullish · 1 bearish · 29 covering AJG
Strong Buy
0
Buy
14
Hold
14
Sell
1
Strong Sell
0
Consensus Target
$274
+39.3% vs today
Scenario Range
$81 – $281
Model bear to bull value window
Coverage
29
Published analyst ratings
Valuation Context
14.9x
Forward P/E · Market cap $50.6B
AJG price targets
Three scenarios for where AJG stock could go
Current
~$197
Confidence
66 / 100
Updated
May 1, 2026
Where we are now
Current · $197
Bear
$81
Base
$332
Bull
$281
Market caseClosest to today
Base case
$332+68.6%
At 25x on FY1 earnings, the base case reflects a reasonable but not stretched valuation. It prices in continued growth without assuming an exceptional setup.
Stress case
Bear case
$81-59.1%
If investor confidence fades or macro conditions deteriorate, a 9x multiple contraction could push AJG down roughly 59% from where it trades now.
Not financial advice. Model confidence reflects internal scenario assumptions, not a guarantee of returns. Past performance does not predict future results.
Arthur J. Gallagher & Co.
AJG · NYSEFinancial ServicesInsurance - BrokersDecember year-end
Arthur J. Gallagher & Co. is a global insurance brokerage and risk management firm that helps clients place insurance coverage and manage risks. It generates revenue primarily through commissions and fees from its Brokerage segment — which handles retail and wholesale insurance placement — and its Risk Management segment, which provides claims administration and consulting services. The company's competitive advantage lies in its global scale, deep industry expertise, and acquisition-driven growth strategy that expands its service capabilities and client relationships.
Market Cap
$50.6B
Revenue TTM
$13.9B
Net Income TTM
$1.5B
Net Margin
10.7%
AJG Revenue and Earnings Performance
Quarterly beat-or-miss track record against analyst estimates, plus forward revenue and EPS outlook for the next two fiscal years.
EPS Beat Rate
75%Exceptional
12 quarters tracked
Revenue Beat Rate
83%Exceptional
vs consensus estimates
Avg EPS Surprise
+0.9%
above Street consensus
Beat / Miss Record
BeatMissLeft = EPS · Right = Revenue
Q3 2025
Q4 2025
Q1 2026
Q2 2026
Last 4 Quarters
EPS beats: 2 of 4Q3 2025
EPS
$2.33/$2.36
Revenue
$3.2B/$3.2B
Q4 2025
EPS
$2.32/$2.51
Revenue
$3.4B/$3.3B
Q1 2026
EPS
$2.38/$2.35
Revenue
$3.6B/$3.6B
Q2 2026
EPS
$4.47/$4.43
Revenue
$4.7B/$4.7B
| Quarter | EPS (Actual / Est) | EPS Surprise | Revenue (Actual / Est) | Rev Surprise |
|---|---|---|---|---|
| Q3 2025 | $2.33/$2.36 | -1.3% | $3.2B/$3.2B | +0.5% |
| Q4 2025 | $2.32/$2.51 | -7.6% | $3.4B/$3.3B | +0.9% |
| Q1 2026 | $2.38/$2.35 | +1.3% | $3.6B/$3.6B | -0.3% |
| Q2 2026 | $4.47/$4.43 | +0.9% | $4.7B/$4.7B | -0.3% |
FY1–FY2 Estimates
Revenue Outlook
FY1
$16.6B
+19.3% YoY
FY2
$19.2B
+15.2% YoY
EPS Outlook
FY1
$9.34
+62.8% YoY
FY2
$9.69
+3.7% YoY
Trailing FCF (TTM)$1.8B
FCF Margin: 12.8%
Next Earnings
—
Expected EPS
—
Expected Revenue
—
AJG beat EPS estimates in 2 of 4 tracked quarters. Mixed delivery makes the upcoming report a key data point for re-rating.
AJG Revenue Breakdown by Segment
Product and geographic revenue mix from the latest annual disclosure, with year-over-year growth by segment.
Latest disclosure
FY 2025
Total disclosed revenue $13.8B
Product Mix
Latest annual revenue by segment or product family
Commissions
58.2%
+19.9% YoY
Tap, hover, or focus a slice to inspect segment detail.
Geographic Mix
Latest annual revenue by reported region
UNITED STATES
67.4%
+26.4% YoY
Tap, hover, or focus a slice to inspect segment detail.
Commissions is the largest disclosed segment at 58.2% of FY 2025 revenue, up 19.9% YoY.
UNITED STATES is the largest reported region at 67.4%, up 26.4% YoY.
AJG Valuation Snapshot
Current multiples compared to the S&P 500, the company's sector, and its own five-year average.
Relative Value Signal
Slightly Overvalued
Fair value est. $190 — implies -8.8% from today's price.
Premium to Fair Value
8.8%
above fair value
Deep DiscountFair ValueVery Expensive
vs S&P 500 Trailing P/E
AJG
34.2x
vs
S&P 500
25.2x
+36% premium
vs Financial Services Trailing P/E
AJG
34.2x
vs
Financial Services
13.4x
+156% premium
vs AJG 5Y Avg P/E
Today
34.2x
vs
5Y Average
42.9x
20% discount
Forward PE
14.9x
S&P 500
19.1x
-22%
Financial Services
10.5x
+42%
5Y Avg
—
—
Trailing PE
34.2x
S&P 500
25.2x
+36%
Financial Services
13.4x
+156%
5Y Avg
42.9x
-20%
PEG Ratio
5.28x
S&P 500
1.75x
+203%
Financial Services
1.03x
+415%
5Y Avg
—
—
EV/EBITDA
17.2x
S&P 500
15.3x
+13%
Financial Services
11.4x
+51%
5Y Avg
21.2x
-19%
Price/FCF
28.4x
S&P 500
21.3x
+33%
Financial Services
10.6x
+167%
5Y Avg
29.3x
-3%
Price/Sales
3.6x
S&P 500
3.1x
+16%
Financial Services
2.3x
+61%
5Y Avg
4.8x
-25%
Dividend Yield
1.30%
S&P 500
1.88%
-31%
Financial Services
2.68%
-52%
5Y Avg
0.99%
+31%
| Metric | AJG | S&P 500 | Financial Services | 5Y Avg AJG |
|---|---|---|---|---|
| Forward PE | 14.9x | 19.1x-22% | 10.5x+42% | — |
| Trailing PE | 34.2x | 25.2x+36% | 13.4x+156% | 42.9x-20% |
| PEG Ratio | 5.28x | 1.75x+203% | 1.03x+415% | — |
| EV/EBITDA | 17.2x | 15.3x+13% | 11.4x+51% | 21.2x-19% |
| Price/FCF | 28.4x | 21.3x+33% | 10.6x+167% | 29.3x |
| Price/Sales | 3.6x | 3.1x+16% | 2.3x+61% | 4.8x-25% |
| Dividend Yield | 1.30% | 1.88% | 2.68% | 0.99% |
AJG trades above S&P 500 benchmarks on 5 of 6 measured multiples — commands a broad premium across most valuation dimensions.
Forward P/E and PEG reflect analyst consensus estimates. Historical averages use trailing ratios where forward data is unavailable.S&P 500 and sector benchmarks both use trailing median P/E — similar readings indicate the broader index and sector are priced alike.
Open valuation toolAJG Financial Health
Verdict
Adequate
AJG posts 10.7% net margin with 6.5% ROE — the core signals of underwriting discipline and capital efficiency.
Underwriting & Earnings
Premium revenue, margins, and returns
Revenue (TTM)
Trailing-twelve-month sales base
$13.9B
Revenue Growth
TTM vs prior year
+20.7%
Operating Margin
Operating income divided by revenue
18.3%
Net Margin
Net income divided by revenue
10.7%
EPS (TTM)
Diluted earnings per share, trailing twelve months
$5.74
ROE
Return on equity — measures underwriting and investment efficiency
6.5%
Capital Quality
ROIC, leverage, and debt serviceability
ROIC
Return on invested capital — primary competitive quality signal
7.0%
ROA
Return on assets, trailing twelve months
2.0%
Cash & Equivalents
Liquid assets on the balance sheet
$1.4B
Net Debt
Total debt minus cash
$12.6B
FCF Analysis
Traditional FCF and debt/FCF ratios are not meaningful for financial companies. Focus on ROE and ROA above.
ROE
Return on equity, trailing twelve months
6.5%
Shareholder Returns
How capital is returned to owners
Total shareholder yield
1.3%
Dividend
1.3%
Buyback
0.0%
Share Repurchases
Trailing buyback outflow — dollar magnitude of capital returned
$0
Dividend / Share
Annualized trailing dividend per share
$2.56
Payout Ratio
Share of earnings distributed as dividends
44.6%
Shares Outstanding
Current diluted share count
257M
All figures from the trailing twelve months. For financial companies, ROE and ROA are the primary health signals — FCF-based metrics are not applicable.
Open full ratios pageAJG Stock Risk Factors
Key factors that could pressure the stock price, compress the multiple, or weigh on future results.
AI analysis · updated April 11, 2026
High Risk
AI Disruption
Artificial intelligence could automate traditional broker roles, potentially eroding AJG’s profit margins. While the firm’s focus on complex commercial, wholesale, and specialty insurance may provide some insulation, the long‑term impact of AI remains uncertain and could materially affect earnings.
High Risk
Acquisition Integration
AJG’s growth strategy relies heavily on acquisitions, notably the recent purchase of AssuredPartners. Risks include failure to realize projected synergies, overvaluation of targets, and legal exposure from a DOJ settlement related to conduct at an AssuredPartners agency, all of which could negatively impact financial performance.
Medium
Economic & Geopolitical Risks
Fluctuations in interest and inflation rates, trade wars, political instability, and armed conflicts can disrupt AJG’s operations and financial results. Supply‑chain disruptions driven by geopolitical tensions and extreme weather further compound these risks.
Medium
Regulatory & Legal Exposure
Additional regulatory requirements from acquisitions and evolving laws—particularly around AI and building safety—could increase compliance costs. Ongoing scrutiny, exemplified by the AssuredPartners settlement, adds further legal and financial risk.
Lower
Cost Pressures & Organic Growth
Rising operating costs and a potential slowdown in organic revenue growth threaten AJG’s margin profile. If cost pressures persist, the company may struggle to maintain profitability.
Lower
Valuation Sensitivity
AJG has traded at a premium relative to peers, making it vulnerable to downward revisions if growth expectations are unmet or market sentiment shifts. A valuation correction could negatively affect the stock price.
These are risk mechanisms, not predictions. The key question is which would force a cut to earnings estimates or a lower multiple than the market currently prices in.
Why AJG Stock Could Outperform
Structural drivers behind the upside case and why the stock could outperform over the next 12 months.
AI analysis · updated April 11, 2026
Stable Fee‑Based Revenue Model
AJG’s insurance brokerage business is built on fee‑based, recurring revenue that is largely non‑discretionary. This structure creates sticky customer relationships and delivers consistent free cash flow even during economic cycles.
Consistent Organic Growth & Margin Expansion
The company has repeatedly demonstrated organic growth while expanding its profit margins. This disciplined execution positions AJG as a defensive play in the current market environment.
Disciplined, Value‑Focused Acquisitions
AJG pursues acquisitions with a modest goodwill‑to‑assets ratio, avoiding overpayment. Effective integration of these deals fuels continued growth without diluting earnings quality.
AI as a Productivity Enabler
Rather than disrupting the brokerage, AI is expected to boost productivity and expand margins. AJG has shown no AI‑driven client attrition, maintaining steady organic growth.
Strong Balance Sheet & Capital Efficiency
AJG boasts a net cash position and a low net debt‑to‑EBITDA ratio, giving it financial flexibility. Operating cash flow consistently exceeds net income, underscoring superior earnings quality.
A real bull case compounds — each driver matters most when it strengthens margins, supports capital returns, and keeps the company above the market's minimum growth bar simultaneously.
AJG Stock Price Performance
52-week range context and price returns across multiple time horizons. Dividend contribution is shown separately in the Capital Return section.
Current Price
$196.91
52W Range Position
1%
52-Week Range
Current price plotted between the 52-week low and high.
52-Week Low
$195.00
+1.0% from the low
52-Week High
$351.23
-43.9% from the high
1 Month
-10.20%
3 Month
-18.49%
YTD
-23.1%
1 Year
-41.8%
3Y CAGR
-2.9%
5Y CAGR
+5.8%
10Y CAGR
+15.4%
Range context matters because valuation compression and earnings misses rarely hit from the same starting point. A stock already far below its high can still fall, but it is no longer carrying the same embedded optimism as one pressing a fresh peak.
AJG vs Peers
Valuation, growth, and margin comparison against the closest publicly traded peers for this company.
Peer Set
Accurate peer set
Forward PE
14.9x
vs 13.8x median
+8% above peer median
Revenue Growth
+19.3%
vs +7.3% median
+165% above peer median
Net Margin
10.7%
vs 16.8% median
-36% below peer median
| Company | Mkt Cap | Fwd PE | Rev Grw | Margin | Rating | Upside |
|---|---|---|---|---|---|---|
AJG AJG Arthur J. Gallagher & Co. | $50.6B | 14.9x | +19.3% | 10.7% | Buy | +39.3% |
MMC MMC Marsh & McLennan Companies, Inc. | $85.3B | 16.9x | +7.3% | 15.6% | Hold | +18.8% |
AON AON Aon plc | $66.0B | 16.2x | +6.6% | 22.5% | Buy | +31.2% |
WTW WTW Willis Towers Watson Public Limited Company | $23.8B | 12.9x | +2.3% | 16.8% | Buy | +34.1% |
BRO BRO Brown & Brown, Inc. | $19.3B | 12.5x | +18.4% | 17.9% | Hold | +56.5% |
RYA RYAN Ryan Specialty Holdings, Inc. | $3.8B | 13.8x | +19.1% | 4.2% | Buy | +55.2% |
This peer comparison reflects companies with similar business models, product lines, or market positioning, supplemented by industry grouping when direct matches are limited.
AJG Dividend and Capital Return
AJG returns 1.3% total yield, led by a 1.30% dividend, raised 15 consecutive years.
Dividend SustainableFCF Well Covered
Total Shareholder Yield
1.3%
Dividend + buyback return per year
Buyback Yield
0.0%
Dividend Yield
1.30%
Payout Ratio
44.6%
How AJG Splits Its Return
Div 1.30%
Dividend 1.30%Buybacks 0.0%
Dividend Profile
Yield, cadence, and growth quality
Dividend / Share
Trailing annualized cash dividend
$2.56
Growth Streak
Consecutive years of dividend increases
15Y
3Y Div CAGR
8.4%
5Y Div CAGR
7.6%
Ex-Dividend Date
—
Payment Cadence
Semi-Annual
5 payments over the last 12 months
Buyback Engine
How much per-share support comes from repurchases
Repurchases (TTM)
Cash used for buybacks in the latest trailing period
$0
Estimated Shares Retired
0
Approx. Share Reduction
0.0%
Shares Outstanding
Current diluted share count from the screening snapshot
257M
| Year | Div / Share | YoY Grw | BB Yield | Total Yield |
|---|---|---|---|---|
| 2026 | $1.40 | — | — | — |
| 2025 | $2.60 | +8.3% | 0.0% | 1.0% |
| 2024 | $2.40 | +9.1% | 0.0% | 0.8% |
| 2023 | $2.20 | +7.8% | 0.0% | 1.0% |
| 2022 | $2.04 | +6.3% | 0.0% | 1.1% |
FAQ
7 questionsAJG Investor Questions
Common questions answered from live analyst data and company financials.
01Is Arthur J. Gallagher & Co. (AJG) stock a buy or sell in 2026?
Arthur J. Gallagher & Co. (AJG) is rated Buy by Wall Street analysts as of 2026. Of 29 analysts covering the stock, 14 rate it Buy or Strong Buy, 14 rate it Hold, and 1 rate it Sell or Strong Sell. The consensus 12-month price target is $274, implying +39.3% from the current price of $197. The bear case scenario is $81 and the bull case is $281.
02What is the AJG stock price target for 2026?
The Wall Street consensus price target for AJG is $274 based on 29 analyst estimates. The high-end target is $334 (+69.6% from today), and the low-end target is $211 (+7.2%). The base case model target is $332.
03Is Arthur J. Gallagher & Co. (AJG) stock overvalued in 2026?
AJG trades at 14.9x times forward earnings. The stock trades at a notable premium to the broad market, which is typical for businesses with strong free cash flow and above-average growth expectations. Based on current multiples versus the peer group, the relative model signals slightly overvalued. Whether the stock is over or undervalued ultimately depends on whether consensus earnings estimates are achievable.
04What are the main risks for Arthur J. Gallagher & Co. (AJG) stock in 2026?
The primary risks for AJG in 2026 are: (1) AI Disruption — Artificial intelligence could automate traditional broker roles, potentially eroding AJG’s profit margins. (2) Acquisition Integration — AJG’s growth strategy relies heavily on acquisitions, notably the recent purchase of AssuredPartners. (3) Economic & Geopolitical Risks — Fluctuations in interest and inflation rates, trade wars, political instability, and armed conflicts can disrupt AJG’s operations and financial results. Each factor has the potential to pressure earnings or compress the stock's valuation multiple.
05What is Arthur J. Gallagher & Co.'s revenue and earnings forecast?
Analyst consensus estimates AJG will report consensus revenue of $16.6B (+19.3% year-over-year) and EPS of $9.34 (+62.8% year-over-year) for the upcoming fiscal year. The following year, analysts project $19.2B in revenue.
06When does Arthur J. Gallagher & Co. (AJG) report its next earnings?
A confirmed upcoming earnings date for AJG is not yet available. Check the Earnings section above for the most recent quarterly report dates and forward estimates.
07How much free cash flow does Arthur J. Gallagher & Co. generate?
Arthur J. Gallagher & Co. (AJG) generated $1.8B in free cash flow over the trailing twelve months — a free cash flow margin of 12.8%. AJG returns capital to shareholders through dividends (1.3% yield) and share repurchases ($0 TTM).