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Arthur J Gallagher Hits 52-Week High on Solid Q2, Buyouts
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On Aug 11, 2016, shares of Arthur J Gallagher & Co. (AJG - Free Report) hit a 52-week high of $49.97, driven by strong second-quarter 2016 results and prudent acquisitions. About 0.7 million shares exchanged hands in the last trading session and the stock finally closed at $49.75, up 0.04%. Year to date, the stock has returned 21.51%, comparing favorably with 6.94% by the S&P 500.
Arthur J Gallagher, in the second quarter, delivered operating earnings per share of 97 cents that surpassed the Zacks Consensus Estimate by 1.04%. The bottom line also improved 4.3% year over year driven by strong performance from the Brokerage segment. This Zacks Rank #3 (Hold) insurance broker delivered positive surprises in each of the last four quarters, with an average beat of 8.83%.
Revenues too improved driven by better performance across both Brokerage and Risk segments. The company has witnessed positive organic growth for 20 straight quarters.
With respect to capital deployment, Arthur J Gallagher bought back shares worth $70.6 million in the second quarter and has 7.7 million shares remaining under its repurchase authorization. Also, the company’s dividend currently yields 3.07%, which is better than the industry average of 1.92%. These make it an attractive pick for yield-seeking investors.
The company also has a compelling inorganic story fueled by strategic acquisitions. While these have expanded the company’s domestic as well as international footprint, they have also added capabilities to the product and service portfolio. This month, the company acquired Texas-based Victory Insurance Agency, Inc., California-based Blue Horizon Insurance Services and England-based Orb Financial Services Limited. Notably, Arthur J Gallagher made 21 acquisitions in the first quarter, having annualized revenues of $70 million.
The Zacks Consensus Estimate currently stands at $2.77 for 2016 and $3.05 for 2017, translating to year-over-year growth of nearly 11% and 10%, respectively. The expected long-term growth is currently pegged at 9.2%.
Some better-ranked stocks from the insurance industry are Erie Indemnity Company (ERIE - Free Report) , Allied World Assurance Company Holdings, AG (AWH - Free Report) and Argo Group International Holdings, Ltd . While Argo Group and Allied World sport a Zacks Rank #1 (Strong Buy), Erie Indemnity carries a Zacks Rank #2 (Buy).
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Arthur J Gallagher Hits 52-Week High on Solid Q2, Buyouts
On Aug 11, 2016, shares of Arthur J Gallagher & Co. (AJG - Free Report) hit a 52-week high of $49.97, driven by strong second-quarter 2016 results and prudent acquisitions. About 0.7 million shares exchanged hands in the last trading session and the stock finally closed at $49.75, up 0.04%. Year to date, the stock has returned 21.51%, comparing favorably with 6.94% by the S&P 500.
Arthur J Gallagher, in the second quarter, delivered operating earnings per share of 97 cents that surpassed the Zacks Consensus Estimate by 1.04%. The bottom line also improved 4.3% year over year driven by strong performance from the Brokerage segment. This Zacks Rank #3 (Hold) insurance broker delivered positive surprises in each of the last four quarters, with an average beat of 8.83%.
Revenues too improved driven by better performance across both Brokerage and Risk segments. The company has witnessed positive organic growth for 20 straight quarters.
With respect to capital deployment, Arthur J Gallagher bought back shares worth $70.6 million in the second quarter and has 7.7 million shares remaining under its repurchase authorization. Also, the company’s dividend currently yields 3.07%, which is better than the industry average of 1.92%. These make it an attractive pick for yield-seeking investors.
The company also has a compelling inorganic story fueled by strategic acquisitions. While these have expanded the company’s domestic as well as international footprint, they have also added capabilities to the product and service portfolio. This month, the company acquired Texas-based Victory Insurance Agency, Inc., California-based Blue Horizon Insurance Services and England-based Orb Financial Services Limited. Notably, Arthur J Gallagher made 21 acquisitions in the first quarter, having annualized revenues of $70 million.
The Zacks Consensus Estimate currently stands at $2.77 for 2016 and $3.05 for 2017, translating to year-over-year growth of nearly 11% and 10%, respectively. The expected long-term growth is currently pegged at 9.2%.
GALLAGHER ARTHU Price and Consensus
GALLAGHER ARTHU Price and Consensus | GALLAGHER ARTHU Quote
Stocks to Consider
Some better-ranked stocks from the insurance industry are Erie Indemnity Company (ERIE - Free Report) , Allied World Assurance Company Holdings, AG (AWH - Free Report) and Argo Group International Holdings, Ltd . While Argo Group and Allied World sport a Zacks Rank #1 (Strong Buy), Erie Indemnity carries a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>