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Arthur J. Gallagher Q4 Earnings & Revenues Beat, Dividend Raised
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Key Takeaways
Arthur J. Gallagher posted Q4 2025 adjusted EPS of $2.38, up 11.7% YoY, beating consensus by 1.2%.
AJG results were driven by Risk Management margin expansion, higher commissions and fees, and EBITDAC.
Arthur J. Gallagher's revenues rose 33.8% YoY to $3.6B, closed six acquisitions, and raised its dividend.
Arthur J. Gallagher & Co. (AJG - Free Report) reported fourth-quarter 2025 adjusted net earnings of $2.38 per share, which beat the Zacks Consensus Estimate by 1.2%. The bottom line increased 11.7% on a year-over-year basis.
Arthur J. Gallagher’s performance was driven by margin expansion in the Risk Management segment, higher commissions, fees, supplemental revenues, and improved EBITDAC.
Arthur J. Gallagher & Co. Price, Consensus and EPS Surprise
Total revenues of $3.6 billion beat the Zacks Consensus Estimate by 0.3%. The top line also improved 33.8% year over year, driven by higher commissions, fees, supplemental revenues, and contingent revenues.
Arthur J. Gallagher’s total expenses increased 44.7% year over year to $3.4 billion in the reported quarter due to higher compensation, operating, reimbursements, interest, depreciation, and amortization.
Earnings before interest, tax, depreciation, and amortization and change in estimated acquisition earnout payables (EBITDAC) grew 3.3% from the prior-year quarter to $710 million.
Segmental Results
Brokerage: Revenues of $3.2 billion increased 38% year over year on higher commissions, fees, supplemental revenues, and contingent revenues.
Expenses increased 46.7% from the year-ago quarter to $2.7 billion due to higher compensation, operating, depreciation and amortization. Adjusted EBITDAC climbed 32% from the year-ago level to $1 billion. Margin contracted 80 basis points (bps) to 32.2%.
Risk Management: Revenues were up 13% year over year to $417 million, owing to higher fees.
Expenses rose 12.9% from the prior-year period to $392 million on higher compensation, operating, reimbursements, and amortization. Adjusted EBITDAC improved 16.8% year over year to $90 million. Margin expanded 90 bps to 21.6%.
Corporate: EBITDAC was a negative $58 million compared with a negative $31 million in the year-ago quarter.
Financial Update
As of Dec. 31, 2025, total assets were $70.6 billion, up 10% from the 2024-end level. At the end of the quarter, cash and cash equivalents of $1.4 billion surged 90.6% from the 2024-end level. As of Dec. 31, 2025, shareholders’ equity rose 15.6% to $23.3 billion from the level on Dec. 31, 2024.
Dividend Update
The board of directors declared a quarterly cash dividend of 70 cents per share, 7.6% higher than the previous dividend of 65 cents. The dividend will be paid out on March 20, 2026, to shareholders of record as of March 6.
Acquisition Update
In the quarter, Arthur J. Gallagher closed six acquisitions with estimated annualized revenues of about $118 million.
Full-Year Update
For the year, the company’s total revenues increased 20.6% year over year to $13.7 billion. The top line missed the consensus estimate by 0.1%.
In 2025, the company closed a total of 31 buyouts with estimated annualized revenues of $3.5 billion.
Adjusted earnings for the full year were $10.69 per share, up 5.8% year over year. The figure beat the Zacks Consensus Estimate by 0.2%.
Brown & Brown, Inc.’s (BRO - Free Report) fourth-quarter 2025 adjusted earnings of 93 cents per share beat the Zacks Consensus Estimate by 2.1%. The bottom line increased 8.1% year over year. Total revenues of $1.6 billion missed the Zacks Consensus Estimate by 2.1%. The top line improved 35.7% year over year. The upside can be primarily attributed to commission and fees, which grew 36% year over year to $1.6 billion and improved investment and other income. The Zacks Consensus Estimate for commission and fees was pegged at $1.6 billion. Organic revenues declined 2.8% to $1 billion in the quarter under review.
Investment income and other income increased 17.3% year over year to $27 million. Adjusted EBITDAC was $529 million, up 35.6% year over year. EBITDAC margin remained unchanged year over year to 32.9%.
The Travelers Companies, Inc. (TRV - Free Report) reported fourth-quarter 2025 core income of $11.13 per share, which beat the Zacks Consensus Estimate by 32% and improved 22% year over year. Travelers’ total revenues increased 3.2% from the year-ago quarter to $12.4 billion, primarily driven by higher premiums, net investment income, and other revenues. The top line beat the Zacks Consensus Estimate by 0.08%.
Net written premiums increased 1% year over year to a record $10.8 billion. Net investment income increased 10.3% year over year to $1 billion. The figure matched the Zacks Consensus Estimate. Travelers witnessed an underwriting gain of $1.7 billion, up 21.7% year over year. The consolidated underlying combined ratio of 82.2 improved 180 bps year over year.
RLI Corp. (RLI - Free Report) reported fourth-quarter 2025 operating earnings of 94 cents per share, which beat the Zacks Consensus Estimate by 23.6%. The bottom line increased 80.8% from the prior-year quarter. Operating revenues for the reported quarter were $449 million, up 3% year over year. The top line missed the Zacks Consensus Estimate by 0.4%.
Gross premiums written decreased 2.1% year over year to $463.2 million. This uptick can be attributed to the solid performance of the Casualty segment (up 2.4%). Our estimate was $505.2 million. Net investment income increased 9.2% year over year to $42.3 million. The Zacks Consensus Estimate was $42.9 million, while our estimate for the metric was pegged at $44.5 million. The investment portfolio’s total return was 1.5% in the quarter.
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Arthur J. Gallagher Q4 Earnings & Revenues Beat, Dividend Raised
Key Takeaways
Arthur J. Gallagher & Co. (AJG - Free Report) reported fourth-quarter 2025 adjusted net earnings of $2.38 per share, which beat the Zacks Consensus Estimate by 1.2%. The bottom line increased 11.7% on a year-over-year basis.
Arthur J. Gallagher’s performance was driven by margin expansion in the Risk Management segment, higher commissions, fees, supplemental revenues, and improved EBITDAC.
Arthur J. Gallagher & Co. Price, Consensus and EPS Surprise
Arthur J. Gallagher & Co. price-consensus-eps-surprise-chart | Arthur J. Gallagher & Co. Quote
Operational Update
Total revenues of $3.6 billion beat the Zacks Consensus Estimate by 0.3%. The top line also improved 33.8% year over year, driven by higher commissions, fees, supplemental revenues, and contingent revenues.
Arthur J. Gallagher’s total expenses increased 44.7% year over year to $3.4 billion in the reported quarter due to higher compensation, operating, reimbursements, interest, depreciation, and amortization.
Earnings before interest, tax, depreciation, and amortization and change in estimated acquisition earnout payables (EBITDAC) grew 3.3% from the prior-year quarter to $710 million.
Segmental Results
Brokerage: Revenues of $3.2 billion increased 38% year over year on higher commissions, fees, supplemental revenues, and contingent revenues.
Expenses increased 46.7% from the year-ago quarter to $2.7 billion due to higher compensation, operating, depreciation and amortization.
Adjusted EBITDAC climbed 32% from the year-ago level to $1 billion. Margin contracted 80 basis points (bps) to 32.2%.
Risk Management: Revenues were up 13% year over year to $417 million, owing to higher fees.
Expenses rose 12.9% from the prior-year period to $392 million on higher compensation, operating, reimbursements, and amortization. Adjusted EBITDAC improved 16.8% year over year to $90 million. Margin expanded 90 bps to 21.6%.
Corporate: EBITDAC was a negative $58 million compared with a negative $31 million in the year-ago quarter.
Financial Update
As of Dec. 31, 2025, total assets were $70.6 billion, up 10% from the 2024-end level. At the end of the quarter, cash and cash equivalents of $1.4 billion surged 90.6% from the 2024-end level. As of Dec. 31, 2025, shareholders’ equity rose 15.6% to $23.3 billion from the level on Dec. 31, 2024.
Dividend Update
The board of directors declared a quarterly cash dividend of 70 cents per share, 7.6% higher than the previous dividend of 65 cents. The dividend will be paid out on March 20, 2026, to shareholders of record as of March 6.
Acquisition Update
In the quarter, Arthur J. Gallagher closed six acquisitions with estimated annualized revenues of about $118 million.
Full-Year Update
For the year, the company’s total revenues increased 20.6% year over year to $13.7 billion. The top line missed the consensus estimate by 0.1%.
In 2025, the company closed a total of 31 buyouts with estimated annualized revenues of $3.5 billion.
Adjusted earnings for the full year were $10.69 per share, up 5.8% year over year. The figure beat the Zacks Consensus Estimate by 0.2%.
Zacks Rank
AJG currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Players
Brown & Brown, Inc.’s (BRO - Free Report) fourth-quarter 2025 adjusted earnings of 93 cents per share beat the Zacks Consensus Estimate by 2.1%. The bottom line increased 8.1% year over year. Total revenues of $1.6 billion missed the Zacks Consensus Estimate by 2.1%. The top line improved 35.7% year over year. The upside can be primarily attributed to commission and fees, which grew 36% year over year to $1.6 billion and improved investment and other income. The Zacks Consensus Estimate for commission and fees was pegged at $1.6 billion. Organic revenues declined 2.8% to $1 billion in the quarter under review.
Investment income and other income increased 17.3% year over year to $27 million. Adjusted EBITDAC was $529 million, up 35.6% year over year. EBITDAC margin remained unchanged year over year to 32.9%.
The Travelers Companies, Inc. (TRV - Free Report) reported fourth-quarter 2025 core income of $11.13 per share, which beat the Zacks Consensus Estimate by 32% and improved 22% year over year. Travelers’ total revenues increased 3.2% from the year-ago quarter to $12.4 billion, primarily driven by higher premiums, net investment income, and other revenues. The top line beat the Zacks Consensus Estimate by 0.08%.
Net written premiums increased 1% year over year to a record $10.8 billion. Net investment income increased 10.3% year over year to $1 billion. The figure matched the Zacks Consensus Estimate. Travelers witnessed an underwriting gain of $1.7 billion, up 21.7% year over year. The consolidated underlying combined ratio of 82.2 improved 180 bps year over year.
RLI Corp. (RLI - Free Report) reported fourth-quarter 2025 operating earnings of 94 cents per share, which beat the Zacks Consensus Estimate by 23.6%. The bottom line increased 80.8% from the prior-year quarter. Operating revenues for the reported quarter were $449 million, up 3% year over year. The top line missed the Zacks Consensus Estimate by 0.4%.
Gross premiums written decreased 2.1% year over year to $463.2 million. This uptick can be attributed to the solid performance of the Casualty segment (up 2.4%). Our estimate was $505.2 million. Net investment income increased 9.2% year over year to $42.3 million. The Zacks Consensus Estimate was $42.9 million, while our estimate for the metric was pegged at $44.5 million. The investment portfolio’s total return was 1.5% in the quarter.