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Arthur J. Gallagher (AJG) Q1 Earnings: Taking a Look at Key Metrics Versus Estimates
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For the quarter ended March 2024, Arthur J. Gallagher (AJG - Free Report) reported revenue of $3.22 billion, up 20.4% over the same period last year. EPS came in at $3.49, compared to $3.03 in the year-ago quarter.
The reported revenue compares to the Zacks Consensus Estimate of $3.15 billion, representing a surprise of +2.07%. The company delivered an EPS surprise of +2.65%, with the consensus EPS estimate being $3.40.
While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.
As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.
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: 51.6% versus 49.7% estimated by two analysts on average.
Risk Management Segment - Operating expense ratio: 19.4% versus the two-analyst average estimate of 18.9%.
Risk Management Segment - Compensation expense ratio: 60.6% compared to the 57.2% average estimate based on two analysts.
Brokerage - Operating expense ratio: 11.9% compared to the 12.1% average estimate based on two analysts.
Revenue- Commissions: $1.99 billion versus the five-analyst average estimate of $2.10 billion. The reported number represents a year-over-year change of +14.1%.
Revenue- Fees: $951.20 million compared to the $830.37 million average estimate based on four analysts. The reported number represents a change of +34.8% year over year.
Total revenue- Brokerage: $2.86 billion compared to the $2.82 billion average estimate based on three analysts. The reported number represents a change of +20.6% year over year.
Revenue Risk Management Segment- Revenues before reimbursements: $352.80 million versus $341.06 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +18.6% change.
Revenue Brokerage Segment- Supplemental revenues: $93.90 million versus the two-analyst average estimate of $94.83 million. The reported number represents a year-over-year change of +15.1%.
Revenue Brokerage Segment- Contingent revenues: $86 million versus $82.79 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a +19.8% change.
Revenue Risk Management Segment- Fees: $344.50 million compared to the $338.05 million average estimate based on two analysts. The reported number represents a change of +17.6% year over year.
Revenue- Supplemental: $93.90 million versus the two-analyst average estimate of $91.83 million. The reported number represents a year-over-year change of +15.1%.
Shares of Arthur J. Gallagher have returned -4.4% over the past month versus the Zacks S&P 500 composite's -3% 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) Q1 Earnings: Taking a Look at Key Metrics Versus Estimates
For the quarter ended March 2024, Arthur J. Gallagher (AJG - Free Report) reported revenue of $3.22 billion, up 20.4% over the same period last year. EPS came in at $3.49, compared to $3.03 in the year-ago quarter.
The reported revenue compares to the Zacks Consensus Estimate of $3.15 billion, representing a surprise of +2.07%. The company delivered an EPS surprise of +2.65%, with the consensus EPS estimate being $3.40.
While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.
As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.
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: 51.6% versus 49.7% estimated by two analysts on average.
- Risk Management Segment - Operating expense ratio: 19.4% versus the two-analyst average estimate of 18.9%.
- Risk Management Segment - Compensation expense ratio: 60.6% compared to the 57.2% average estimate based on two analysts.
- Brokerage - Operating expense ratio: 11.9% compared to the 12.1% average estimate based on two analysts.
- Revenue- Commissions: $1.99 billion versus the five-analyst average estimate of $2.10 billion. The reported number represents a year-over-year change of +14.1%.
- Revenue- Fees: $951.20 million compared to the $830.37 million average estimate based on four analysts. The reported number represents a change of +34.8% year over year.
- Total revenue- Brokerage: $2.86 billion compared to the $2.82 billion average estimate based on three analysts. The reported number represents a change of +20.6% year over year.
- Revenue Risk Management Segment- Revenues before reimbursements: $352.80 million versus $341.06 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +18.6% change.
- Revenue Brokerage Segment- Supplemental revenues: $93.90 million versus the two-analyst average estimate of $94.83 million. The reported number represents a year-over-year change of +15.1%.
- Revenue Brokerage Segment- Contingent revenues: $86 million versus $82.79 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a +19.8% change.
- Revenue Risk Management Segment- Fees: $344.50 million compared to the $338.05 million average estimate based on two analysts. The reported number represents a change of +17.6% year over year.
- Revenue- Supplemental: $93.90 million versus the two-analyst average estimate of $91.83 million. The reported number represents a year-over-year change of +15.1%.
View all Key Company Metrics for Arthur J. Gallagher here>>>Shares of Arthur J. Gallagher have returned -4.4% over the past month versus the Zacks S&P 500 composite's -3% 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.