Latest Ratios: P/E Ratio 39.5x · EV/EBITDA 19.3x · ROE 6.9%. (1996–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $58.4B | $67.4B | $63.6B | $49.3B | $40.5B | $35.2B | $24.1B | $18.1B | $13.7B | $11.5B | $9.3B |
| Enterprise Value | $71.0B | $80.0B | $62.1B | $56.7B | $46.2B | $41.4B | $28.3B | $22.4B | $16.7B | $14.0B | $11.6B |
| P/E Ratio → | 39.50 | 45.01 | 43.47 | 50.88 | 36.33 | 38.83 | 29.45 | 27.05 | 21.68 | 24.91 | 22.40 |
| P/S Ratio | 4.19 | 4.83 | 5.50 | 4.90 | 4.73 | 4.28 | 3.44 | 2.54 | 1.98 | 1.85 | 1.63 |
| P/B Ratio | 2.53 | 2.89 | 3.15 | 4.56 | 4.40 | 4.11 | 3.87 | 3.47 | 3.00 | 2.77 | 2.54 |
| P/FCF | 32.69 | 37.74 | 26.04 | 26.83 | 33.53 | 22.32 | 14.59 | 18.47 | 21.41 | 15.90 | 22.93 |
| P/OCF | 30.23 | 34.91 | 24.61 | 24.27 | 29.12 | 20.64 | 13.77 | 16.18 | 17.93 | 13.49 | 14.90 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 5.74 | 5.37 | 5.63 | 5.40 | 5.04 | 4.04 | 3.15 | 2.42 | 2.24 | 2.04 |
| EV / EBITDA | 19.33 | 21.78 | 19.86 | 22.17 | 20.36 | 21.73 | 17.67 | 18.39 | 16.14 | 15.58 | 14.00 |
| EV / EBIT | 27.84 | 31.50 | 27.50 | 38.24 | 29.14 | 34.43 | 26.54 | 27.85 | 27.07 | 28.88 | 26.10 |
| EV / FCF | — | 44.81 | 25.42 | 30.83 | 38.23 | 26.25 | 17.13 | 22.89 | 26.10 | 19.28 | 28.62 |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 54.8% | 54.8% | 42.2% | 42.1% | 42.1% | 36.2% | 35.8% | 32.1% | 28.0% | 27.6% | 28.2% |
| Operating Margin | 18.3% | 18.3% | 19.8% | 18.5% | 19.5% | 16.3% | 14.8% | 10.5% | 8.9% | 8.2% | 8.4% |
| Net Profit Margin | 10.7% | 10.7% | 12.7% | 9.6% | 13.0% | 11.0% | 11.7% | 9.4% | 9.1% | 7.7% | 7.0% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 6.9% | 6.9% | 9.4% | 9.7% | 12.6% | 12.3% | 14.3% | 13.7% | 14.5% | 12.3% | 10.8% |
| ROA | 2.2% | 2.2% | 2.5% | 2.2% | 3.1% | 3.3% | 3.9% | 3.7% | 4.3% | 3.9% | 3.5% |
| ROIC | 7.0% | 7.0% | 9.3% | 8.4% | 8.4% | 8.0% | 7.8% | 6.5% | 6.5% | 6.1% | 6.1% |
| ROCE | 7.0% | 7.0% | 8.2% | 9.9% | 9.9% | 9.3% | 9.1% | 7.7% | 7.4% | 6.9% | 7.0% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.60 | 0.60 | 0.67 | 0.77 | 0.70 | 0.77 | 0.78 | 0.95 | 0.79 | 0.75 | 0.78 |
| Debt / EBITDA | 3.81 | 3.81 | 4.32 | 3.25 | 2.83 | 3.46 | 3.04 | 4.05 | 3.48 | 3.49 | 3.45 |
| Net Debt / Equity | — | 0.54 | -0.07 | 0.68 | 0.62 | 0.72 | 0.67 | 0.83 | 0.66 | 0.59 | 0.63 |
| Net Debt / EBITDA | 3.43 | 3.43 | -0.48 | 2.87 | 2.50 | 3.25 | 2.62 | 3.56 | 2.90 | 2.73 | 2.79 |
| Debt / FCF | — | 7.06 | -0.62 | 4.00 | 4.70 | 3.93 | 2.54 | 4.43 | 4.69 | 3.38 | 5.70 |
| Interest Coverage | 3.97 | 3.97 | 5.92 | 4.99 | 6.17 | 5.31 | 5.43 | 4.48 | 4.46 | 3.90 | 4.04 |
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 1.06 | 1.06 | 1.51 | 1.03 | 1.04 | 1.06 | 1.10 | 1.02 | 1.06 | 1.05 | 0.96 |
| Quick Ratio | 1.06 | 1.06 | 1.51 | 1.03 | 1.04 | 1.06 | 1.10 | 1.02 | 1.06 | 1.05 | 0.96 |
| Cash Ratio | 0.04 | 0.04 | 0.51 | 0.03 | 0.03 | 0.02 | 0.07 | 0.07 | 0.08 | 0.14 | 0.12 |
| Asset Turnover | — | 0.20 | 0.18 | 0.20 | 0.22 | 0.25 | 0.31 | 0.36 | 0.42 | 0.48 | 0.49 |
| Inventory Turnover | — | — | — | — | — | — | — | — | — | — | — |
| Days Sales Outstanding | — | — | — | — | — | — | — | — | — | — | — |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 1.1% | 1.0% | 0.8% | 1.0% | 1.1% | 1.1% | 1.4% | 1.8% | 2.2% | 2.5% | 2.9% |
| Payout Ratio | 44.6% | 44.6% | 35.9% | 48.8% | 38.5% | 43.2% | 42.4% | 48.0% | 47.6% | 58.7% | 68.6% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 2.5% | 2.2% | 2.3% | 2.0% | 2.8% | 2.6% | 3.4% | 3.7% | 4.6% | 4.0% | 4.5% |
| FCF Yield | 3.1% | 2.6% | 3.8% | 3.7% | 3.0% | 4.5% | 6.9% | 5.4% | 4.7% | 6.3% | 4.4% |
| Buyback Yield | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.1% | 0.2% | 1.1% |
| Total Shareholder Yield | 1.1% | 1.0% | 0.8% | 1.0% | 1.1% | 1.1% | 1.4% | 1.8% | 2.3% | 2.6% | 4.0% |
| Shares Outstanding | — | $260M | $224M | $219M | $215M | $207M | $195M | $190M | $186M | $182M | $178M |
Includes 30+ ratios · 30 years · Updated daily
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10-year return with dividends reinvested.
Compare growth, multiples, and margins vs sector.
Quick answers to the most common questions about buying AJG stock.
Arthur J. Gallagher & Co.'s current P/E ratio is 39.5x. The historical average is 27.6x. This places it at the 87th percentile of its historical range.
Arthur J. Gallagher & Co.'s current EV/EBITDA is 19.3x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 13.9x.
Arthur J. Gallagher & Co.'s return on equity (ROE) is 6.9%. The historical average is 18.5%.
Based on historical data, Arthur J. Gallagher & Co. is trading at a P/E of 39.5x. This is at the 87th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
Arthur J. Gallagher & Co.'s current dividend yield is 1.13% with a payout ratio of 44.6%.
Arthur J. Gallagher & Co. has 54.8% gross margin and 18.3% operating margin. Operating margin between 10-20% is typical for established companies.
Arthur J. Gallagher & Co.'s Debt/EBITDA ratio is 3.8x, indicating high leverage. A ratio between 2-4x is manageable but warrants monitoring.
Key Metrics
Top Statement Risk
Wage inflation compressing margins
Metrics are mathematically derived from official filings.
Underwriting Discipline Amidst Volatile Loss Ratios
AJG's combined ratio averaged 82.3% over the last ten quarters, consistently below 100%, indicating sustained underwriting profitability despite volatile loss ratios, as per recent SEC filings.
The combined ratio improved to 85.3% in Q2 2026 from 80.6% a year earlier, but the loss ratio swung dramatically from 60.9% in Q4 2025 to 15.1% in Q1 2026, suggesting significant reserve releases or timing differences. The expense ratio, however, has been creeping upward, reaching 66.2% in Q2 2026, which may indicate cost pressures from wage inflation. Investors should monitor whether the low loss ratios are sustainable or if they reflect one-time reserve adjustments.
ROE Decomposition: Underwriting Profits Mask Investment Income
ROE averaged 2.4% quarterly over the last ten periods, with underwriting margins contributing positively, but investment income data is unavailable, as per financial statements.
The underwriting margin has been consistently positive, ranging from 9.4% to 28.1%, which supports ROE, but the quarterly ROE figures are modest, averaging around 2.4%. The lack of disclosed investment income suggests that the reported ROE may understate the true earnings power if fiduciary interest income is significant. Given the hard market and rising rates, investment income on float could be a meaningful contributor, but without explicit data, its impact remains uncertain.
Expense Ratio Creep Signals Margin Pressure
The expense ratio rose to 66.2% in Q2 2026 from 23.3% a year earlier, indicating that cost growth is outpacing revenue, as reported in recent earnings.
The sharp increase in the expense ratio, particularly in Q2 2026, aligns with the EPS miss and suggests that wage inflation is compressing margins. While the combined ratio remains below 100%, the rising expense ratio may indicate that AJG is unable to fully pass on higher compensation costs. This trend warrants close monitoring, as sustained expense inflation could erode underwriting profitability despite top-line growth.
Underwriting Leverage Appears Conservative
The debt-to-equity ratio declined to 0.08 in Q2 2026 from 0.76 in Q2 2024, indicating a strengthening capital base, as per recent balance sheet data.
The reported D/E ratio of 0.08 is unusually low for an insurance broker, suggesting significant untapped debt capacity for future acquisitions or capital returns. However, this figure may not capture total economic leverage, including operating leases and contingent earn-outs. The premium-to-surplus ratio, while not directly provided, appears manageable given the equity growth, but investors should verify the sustainability of this leverage level.
Valuation Premium Reflects Growth, Not Profitability
AJG trades at a forward P/E of 19.6x versus BRO's 22.8x and MMC's 21.3x, yet its ROE of 5.6% lags peers, as per current valuation metrics.
AJG's P/B of 2.94 is lower than MMC's 6.38 and AON's 8.05, but its ROE is also lower, suggesting the market is pricing in future growth rather than current profitability. The PEG ratio of 7.08 is elevated, indicating that the growth expectations embedded in the valuation may be aggressive. The premium over BRO, which has a similar middle-market focus, may be justified by AJG's larger scale and TPA integration, but it also implies that the market expects continued outperformance.
Combined Ratio Misleads Without Reserve Adjustments
The combined ratio appears strong, but volatile loss ratios suggest reserve releases may be masking underlying deterioration, as per reported figures.
The combined ratio has been below 100% for ten consecutive quarters, but the loss ratio swings from 60.9% to 9.4% indicate that reserve releases are likely boosting underwriting results. Analysts should adjust for prior-year reserve development to assess the true underwriting performance. Additionally, the expense ratio's upward trend may signal that the combined ratio's stability is not sustainable. A more accurate measure would be the accident-year combined ratio, which excludes reserve adjustments.