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Arthur J. Gallagher (AJG) Q4 Earnings: Taking a Look at Key Metrics Versus Estimates
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Arthur J. Gallagher (AJG - Free Report) reported $2.39 billion in revenue for the quarter ended December 2023, representing a year-over-year increase of 19.9%. EPS of $1.85 for the same period compares to $1.54 a year ago.
The reported revenue compares to the Zacks Consensus Estimate of $2.37 billion, representing a surprise of +1.10%. The company delivered an EPS surprise of +1.09%, with the consensus EPS estimate being $1.83.
While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.
Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.
Here is how Arthur J. Gallagher performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:
Brokerage - Compensation expense ratio: 57.4% compared to the 56.1% average estimate based on three analysts.
Risk Management Segment - Operating expense ratio: 18.4% versus the three-analyst average estimate of 19.1%.
Risk Management Segment - Compensation expense ratio: 61% versus 55.3% estimated by three analysts on average.
Brokerage - Operating expense ratio: 16.3% versus 15.7% estimated by three analysts on average.
Revenue- Commissions: $1.33 billion versus $1.37 billion estimated by five analysts on average. Compared to the year-ago quarter, this number represents a +15% change.
Revenue- Fees: $802.40 million versus $771.27 million estimated by five analysts on average. Compared to the year-ago quarter, this number represents a +22.6% change.
Revenue Risk Management Segment- Revenues before reimbursements: $340.40 million versus the four-analyst average estimate of $336.69 million. The reported number represents a year-over-year change of +17.1%.
Revenue Risk Management Segment- Fees: $331.60 million compared to the $332.41 million average estimate based on three analysts. The reported number represents a change of +14.7% year over year.
Revenue Brokerage Segment- Contingent revenues: $55.40 million versus $49.38 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +37.8% change.
Revenue Brokerage Segment- Supplemental revenues: $90.60 million versus the three-analyst average estimate of $83.39 million. The reported number represents a year-over-year change of +13.3%.
Total revenue- Brokerage: $2.05 billion versus $2.01 billion estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +20.4% change.
Revenue Risk Management Segment- Reimbursements: $38.80 million versus $35.67 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +17.2% change.
Shares of Arthur J. Gallagher have returned +7.2% over the past month versus the Zacks S&P 500 composite's +2.5% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.
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Arthur J. Gallagher (AJG) Q4 Earnings: Taking a Look at Key Metrics Versus Estimates
Arthur J. Gallagher (AJG - Free Report) reported $2.39 billion in revenue for the quarter ended December 2023, representing a year-over-year increase of 19.9%. EPS of $1.85 for the same period compares to $1.54 a year ago.
The reported revenue compares to the Zacks Consensus Estimate of $2.37 billion, representing a surprise of +1.10%. The company delivered an EPS surprise of +1.09%, with the consensus EPS estimate being $1.83.
While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.
Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.
Here is how Arthur J. Gallagher performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:
- Brokerage - Compensation expense ratio: 57.4% compared to the 56.1% average estimate based on three analysts.
- Risk Management Segment - Operating expense ratio: 18.4% versus the three-analyst average estimate of 19.1%.
- Risk Management Segment - Compensation expense ratio: 61% versus 55.3% estimated by three analysts on average.
- Brokerage - Operating expense ratio: 16.3% versus 15.7% estimated by three analysts on average.
- Revenue- Commissions: $1.33 billion versus $1.37 billion estimated by five analysts on average. Compared to the year-ago quarter, this number represents a +15% change.
- Revenue- Fees: $802.40 million versus $771.27 million estimated by five analysts on average. Compared to the year-ago quarter, this number represents a +22.6% change.
- Revenue Risk Management Segment- Revenues before reimbursements: $340.40 million versus the four-analyst average estimate of $336.69 million. The reported number represents a year-over-year change of +17.1%.
- Revenue Risk Management Segment- Fees: $331.60 million compared to the $332.41 million average estimate based on three analysts. The reported number represents a change of +14.7% year over year.
- Revenue Brokerage Segment- Contingent revenues: $55.40 million versus $49.38 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +37.8% change.
- Revenue Brokerage Segment- Supplemental revenues: $90.60 million versus the three-analyst average estimate of $83.39 million. The reported number represents a year-over-year change of +13.3%.
- Total revenue- Brokerage: $2.05 billion versus $2.01 billion estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +20.4% change.
- Revenue Risk Management Segment- Reimbursements: $38.80 million versus $35.67 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +17.2% change.
View all Key Company Metrics for Arthur J. Gallagher here>>>Shares of Arthur J. Gallagher have returned +7.2% over the past month versus the Zacks S&P 500 composite's +2.5% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.