Arthur J Gallagher & Co
) continue to gain riding on the strength of its impressive
inorganic growth story. Shares have gained almost 36%
year-to-date. The insurance broker announced yet another
GALLAGHER ARTHU (AJG): Free Stock Analysis
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VALIDUS HOLDING (VR): Free Stock Analysis
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Arthur J. Gallagher & Co. acquired Springfield,
Missouri-based employee benefit brokerage and consulting services
provider, Jenkins and Associates for an undisclosed amount. This
acquisition takes AJG's quarter-to-date takeover tally to 11,
which compares favorably with eight acquisitions (with annualized
revenues totaling $135.5 million) closed in the preceding
quarter. On the other hand, the month's count hits a grand six.
The company's strong financial position continues to support its
series of acquisitions.
The abovementioned acquisition complements AJG's employee
benefits operations as Jenkins and Associates provides group
medical, dental, life, voluntary benefits, disability, wellness
and long-term care insurance products. In addition, the deal will
enhance the acquirer's presence in the Midwest.
Arthur J. Gallagher & Co. continuously undertakes
acquisitions to augment its product and service offerings as well
as leverage its international footprint. These initiatives should
aid the company's earnings performance going forward. The Zacks
Consensus Estimate for 2014 stands at $2.52, up 17.9% year over
We expect Arthur J. Gallagher & Co.'s compelling inorganic
growth story to influence analysts to raise their estimates,
which in turn will exert upward pressure on its Zacks Rank.
Arthur J. Gallagher & Co. presently carries a Zacks Rank #3
With respect to earnings performance, AJG delivered positive
surprises in 3 of the last 4 quarters with an average beat of
almost 9.2%. The Zacks Consensus Estimate for fourth quarter and
full year 2013 is currently pegged at 49 cents and $2.14,
respectively. These estimates also translate into a
year-over-year upside of 23.4% and 17.9%, respectively.
Among other insurance brokers, Brown & Brown of Kentucky
Inc., a subsidiary of
Brown & Brown Inc
), has agreed to acquire selected assets of O'Neil Financial
Services, Agency Services Consolidated Inc. as well as certain
assets of Preserve Extended Protection Plan Inc. Marsh &
McLennan Agency LLC, a subsidiary of insurance broker
Marsh & McLennan Companies Inc
) also announced the acquisition of Cambridge Property &
Casualty, one of the largest property/casualty insurance agencies
A better-ranked insurance broker
Validus Holdings, Ltd
) with Zacks Rank #1 (Strong Buy) is also worth considering.