Markets
MMC

Arthur J. Gallagher Expands Globally With Boston Marks Buyout

An image of a stock chart
Credit: Shutterstock photo

Arthur J. Gallagher & Co.AJG recently acquired insurance brokers of Boston Marks Group in its effort to expand outside the United States. The terms of the transaction remain undisclosed.

The acquisitions include Marks Insurance NZ in New Zealand, BMG Aviation in Australia and the book of business of Boston Marks Insurance Brokers in the United Kingdom. Established in 1985, Boston Marks Group provides brokerage insurance for the aviation sector. The company offers retail property/casualty brokerage services to a broad range of government, commercial and private aviation and aerospace clients. It has operations in Auckland and Papakura in New Zealand, Gold Coast, Queensland and Perth, Western Australia in Australia and London, England.

Addition of these insurance brokers to Arthur J. Gallagher's portfolio will help ramp up its capabilities in the aviation sector, particularly in Australia and New Zealand.

Arthur J. Gallagher derives about one-third of its revenues from international operations. Given the number and size of the non-U.S. acquisitions, the Zacks Rank #3 (Hold) insurance broker expects international contribution to total revenues to increase.

Given the insurance industry's all-time high capital level, insurers are aggressively pursuing mergers and acquisitions to ramp up growth, expand footprint, enhance capabilities and diversify operations. Arthur J. Gallagher's inorganic pipeline remains strong with about $500 million of revenues.

Shares of Arthur J. Gallagher have rallied 18.6% year to date, outperforming the industry 's increase of 11.8%. Its expansion policy to ramp up growth and a strong capital position should help retain the momentum.

Insurers on an Integration Spree

There have been a significant number of acquisitions in the space of late, given the insurance industry's all-time high capital. Last month, Brown & Brown, Inc. BRO acquired Hays Companies to ramp up its employee benefits business while Marsh & McLennan Companies, Inc.'s MMC unit Mercer acquired investment consulting, alternatives consulting and wealth management operations of Pavilion Financial Corporation to provide wider and deeper global research and specialist resources to its consultants and clients

A Stock That Warrants a Look

A better-ranked stock from the same space is eHealth, Inc. EHTH , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

eHealth provides private online health insurance exchange services to individuals, families, and small businesses in the United States and China. The company delivered positive earnings surprise of 50.00% in the last reported quarter.

Today's Stocks from Zacks' Hottest Strategies

It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.

And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.

See Them Free>>

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

Brown & Brown, Inc. (BRO): Free Stock Analysis Report

eHealth, Inc. (EHTH): Free Stock Analysis Report

Arthur J. Gallagher & Co. (AJG): Free Stock Analysis Report

Marsh & McLennan Companies, Inc. (MMC): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

MMC BRO EHTH AJG

Other Topics

Stocks

Latest Markets Videos

Zacks

Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

Learn More