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Arthur J. Gallagher & Co. Ramps Up Expansion with Buyouts

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Arthur J. Gallagher & Co. (AJG - Free Report) has announced back-to-back acquisitions. The insurance broker recently took over Armstrong/Robitaille/Riegle, Inc., and Ann Arbor Business Advisors, LLC. in Michigan and Total Reward Group in England. Transaction details remained under wraps for both buyouts.

Kent, England-based Total Reward Group was established in 2005. The company provides remuneration support, executive search, interim placement and corporate training for reward professionals across the globe. It expects to leverage the acquired company’s compensation consulting expertise to enhance its own benefit capabilities.  
   
Ann Arbor, Michigan-based Armstrong/Robitaille/Riegle, Inc. and Ann Arbor Business Advisors  provides employee benefits, retirement planning, life insurance and human resource consulting, as well as commercial and personal property/casualty coverages. The company serves clients in Michigan and California. Hence, this acquisition is expected to add capabilities to the acquirer’s compelling portfolio.

Arthur J. Gallagher & Co.’s growth story looks impressive. The Zacks Rank #3 (Hold) insurance broker remains focused on international expansion through acquisitions and organic measures. The company’s international operations are primarily spread across Australia, Bermuda, Canada, the Caribbean, Singapore, New Zealand and the U.K.

Arthur J. Gallagher’s international operations accounts for 35% of the revenues. The company expects international contribution to total revenue to increase, given the number and size of non-U.S. acquisitions. The insurance broker’s merger and acquisition pipeline remains strong with $350 million of revenues.

Buyouts not only widen the company’s geographical footprints but also enhance its portfolio of services. Furthermore, such deals consolidate its position in retail and wholesale insurance brokerage services and risk management industries.

Shares of Arthur J. Gallagher gained 17.42% in a year’s time, outperforming the Zacks categorized Insurance Broker industry’s 15.99% increase. The company’s focus on international expansion, ramping up growth profile and strong capital position should continue to drive the shares higher.



Stocks to Consider

Better-ranked stocks from the insurance industry are eHealth, Inc. (EHTH - Free Report) , Aon plc (AON - Free Report) and ProAssurance Corporation (PRA - Free Report) .

eHealth provides private online health insurance services in the United States and China. The company posted a 596.15% positive surprise in last reported quarter. The stock flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Aon offers risk management services, insurance and reinsurance brokerage, plus human resource consulting and outsourcing services worldwide. The company posted a 13.28% positive surprise in the last reported quarter. The stock carries a Zacks Rank #2 (Buy).

Torchmark provides annuities, whole and term life insurance, accidental death insurance, health insurance, Medicare supplements and long-term healthcare policies. The company delivered a 0.88% positive surprise in the last reported quarter. The stock carries a Zacks Rank #2.

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